Investor Resources

First and foremost, look for an operator, sponsor, or manager (this is who is controlling the deal) that knows what they are doing and not one that has taken advantage of a rising real estate market.

Finding the right Operator, Manager, Sponsor or Managing General Partner (GP)

The managing GP (person or team), should have a good reputation, a proven track record, and is open to you speaking with current and previous investors.

This GP group should have multiple operational plans and not just one. “Everyone has a plan until they're punched in the face”. They will need to be able to adjust and maneuver the market and unexpected conditions. So the first thing to look for would be a good operator. The second thing you have to do is look through the documents of the deal.

Do Your Due Diligence

Understanding how to examine an investment real estate deal is difficult and whole courses are put together to teach how to analyze assets and expected returns. Performing due diligence (DD) on the investment asset(s) is important but secondary to doing your DD on the structure of the deal and GP.

The Subscription Agreements (SA), the Operating Agreements (OA), and Private Placement Memorandums (PPM) are the main documents that highlight the structure and relationship between the LP’s and GP’s. There are many, many pages of legal docs to review. If you don't have a lawyer looking over everything with you, you need to take your time and go through all of it. 

I have read through hundreds and hundreds of different subscription agreements. You'd be surprised what hidden fees and structures are written in some. I reviewed the documents from a competitor, and I found around 16% of fees that were diluting that investment before any money was paid out. Make sure the fees are upfront and clearly written in those legal docs.

(44) What should investors look for when choosing a Real Estate Syndication? | Dual City Investments - YouTube