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Estate Syndications - Continued...
To enable the
syndications to take place, the developer must provide certain due diligence
documents and Rainmaker is the consulting firm to turn to for due diligence
documentation of multifamily housing development financing proposals:
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First, we are
the firm to turn to for market feasibility studies. We have prepared
literally hundreds of multifamily housing market studies and we would
welcome the opportunity to prepare your study.
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Next,
Rainmaker is the firm to turn to for your financial feasibility study.
Rainmaker's expertise and proprietary software can make a big difference in
the overall turnaround time.
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Finally,
Rainmaker can manage the rest of the due diligence process, provide business
plans, capital funding proposals and then back them up with negotiations
assistance and development management consulting.
Rainmaker
Marketing Corporation supports
two (2) basic types of syndication plans:
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Condominium
Investment Plan Syndications. No, this is not a way of selling housing
inventory for dwellers. In today's multifamily market, the use of a
condominium plan is solely for creating a mid-term investor syndication that
will pump more equity into any given project. The key is understanding
the limitations placed on the use of these proceeds. In most states,
the proceeds cannot be accessed until construction is complete - or
something close to the construction completion. Rainmaker creates
these plans based upon the projected capital expense for the last 45 to 60
days of the construction phase. If we use the last month as the
pertinent example. we see construction cost reimbursements are required, but
also the funding of reserves and working capital happen in that same time
period. This means the condominium plan can have a big impact, but
this must be balanced against the resulting business deal limitations.
Turn to Rainmaker to find out how your plan can be put together and how it
can be financed.
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Fractional
Tenants-In-Common (TIC) Ownership Plan Syndications. Unlike the
condominium plan approach that has a limitation on the use of proceeds until
the very end of the construction period, the TIC plan approach may provide
financing as early in the development schedule as the pre-construction
phase. This makes the TIC plan syndication very valuable because:
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the raise
can be done prior to the construction loan submittal, thus
"masking" the developer in deals where the developer only has
seed capital in the deal; and
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the raise
can continue until there are enough proceeds to induce a lender to close
on financing that is non-recourse to the developer and eliminates the
cross-pledge on the developer's other assets.
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Time to get to
work. No matter what happens in the capital markets, if you have the seed
capital to get started - usually in the range of $350,000 to $500,000, then you
have a ticket to develop and leverage an incredible amount of multifamily
housing construction financing.
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What's New!
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