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Investors
seeking to participate in motel
commercial real estate investment syndicates and motel developers
seeking to sponsor motel real estate investment syndicates to provide
equity financing for project development financing now have multiple
venues to choose from. Investors seeking to participate in the
cash flow opportunities available through commercial real estate now
have additional types of syndicates to participate in that cover a wide
variety of industries:
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All
hospitality property types.
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All
senior housing property types.
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All
retail property types.
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All
commercial office property types.
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All
healthcare property types.
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All
multifamily housing property types.
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All
warehouse/flexspace/manufacturing property types.
All projects
are divided into one (1) of three (3) property classes:
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Pre-Construction
Phase Syndicates. Comparatively speaking, these syndicates are
the most risky. Project Sponsors that do not as yet have a
bankable firm commitment for the required construction mortgage
financing loan of the Project will be classified under this heading
and the use of proceeds will be subject to certain expenses
only. Each Pre-Construction Phase Syndication sales plan is
based upon a minimum sales target; an amount equal to the imputed
equity gap (the total project budget less total other financing
proceeds), or $2,500,000; whichever is greater. All
Pre-Construction Phase Syndicates must have a proposed holding
period not to exceed three (3) years. The expected gross
return paid to the investors is a range of 150% to 300%.
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Construction
Phase Syndicates. Comparatively speaking, these syndicates are
less risky than Pre-Construction Phase Syndicates, but generally
more risky than Post-Construction Phase Syndicates (below).
Project Sponsors that do have a bankable firm commitment for the
required construction mortgage financing loan are classified under
this paragraph. Each Construction Phase Syndication sales plan
is based upon a minimum sales target; an amount equal to the imputed
equity gap (the total project budget less total other financing
proceeds), or $2,500,000; whichever is greater. All
Construction Phase Syndicates must have a proposed holding period
not to exceed three (3) years. The expected gross return paid
to the investors is a range of 150% to 250%.
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Post-Construction
Phase Syndicates. Comparatively speaking, these syndicates are
the least risky and therefore require extended holding periods in
order to create gross returns that are competitive with those in the
other categories (above). Post-Construction Phase Syndicates
are for properties requiring no materially significant construction
operations as pending the closing of the Syndicate escrow.
These syndicates require a holding period of 7 to 10 years in order
to generate a gross return to the investor in excess of 250%.
The minimum
investment is always the same - $25,000.00. This allows for widest
possible ownership, while enforcing a set of transaction ground rules
that increase the transparency of all transactions and creates a
secondary level of much-needed capital market liquidity for commercial
real estate development finance transactions across the entire spectrum
of industries. If you are a developer of hospitality properties,
then you need to consider the financial investment leverage this
specific type of syndication approach provides.
All
syndications are undertaken by an affiliate of Rainmaker Marketing
Corporation - www.realestateplays.com/.
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