Self-Administered
Commercial Real Estate Syndication Consulting Assistance...
In the commercial real
estate development finance arena, commercial real estate syndications
offer the commercial real estate developer the opportunity to fund a large
portion of the project's capital budget with non-recourse financing as
early as the pre-construction phase that does not require the developer to
accept a dilution hit of the developer's interest as the price for getting
in the game (click
here for the Powerpoint presentation on commercial real estate
syndication financing).
Sounds good so far, right?
The devil is in the details. You have to find a
syndicator who can be convinced of the merits of your project (they don't
want to hand yet another turkey to their stable of real estate
investors) who also has enough of a Rolodex of contacts to get the job
done. In the end, all the costs of marketing, advertising and
administering your commercial real estate syndication will have to be paid
by you and these costs are paid in advance. If you think there is
someone out there that will raise money for your project out of their
pocket and then turn the money over to you in exchange for a fractional
commission, then you are being intentionally naive about the matter and
you have no business being in business.
Whether you are doing a private placement offering, a
commercial real estate syndication or a government-insured construction
mortgage loan application, the responsibility for paying all the costs
(whether the raise is ultimately successful or not) is the sole liability
and expense of the developer and the developer's sponsorship group.
This includes the resulting legal opinions and contracts, the due
diligence documentation, the administration plan, the marketing and
advertising costs and all associated costs are the entrepreneur's to bear.
This economic fact of life means there really is no
advantage to having a syndicator undertake your commercial real estate
syndication unless they have a stable of investors screaming for
product. How many of them really have that situation and will want
to take a chance on your project? How many of them will give you
commercial terms you can live with and a deal structure that leaves you in
control of your future?
For clients who don't like the answers they are getting to
these fundamental questions, Rainmaker Marketing Corporation offers a
complete retinue of consulting services to allow developers and
owner/operators of commercial income-producing property developments to
access syndicated real property financing. Contact our offices and
find out what can be done for your development finance ambitions. In
this economy, the stone you leave unturned is the one that will come back
later to clean your clock.
