In this episode, Syndication Attorneys' Founder Kim Lisa Taylor and Business Development Director Krisha Young discuss capital raising for real estate syndicators, fund managers, and developers. Whether you're starting or scaling your portfolio, understanding how to secure capital is essential. We'll explore effective capital-raising strategies, key financial metrics investors focus on, and the types of funding available. We’ll cover legal and regulatory considerations, offer advice on avoiding common mistakes, and provide strategies for building strong relationships with passive investors. Whether navigating your first deal or refining your strategy, this episode will offer valuable insights.

Effective Ways to Raise Capital (00:03:28)
Kim Lisa Taylor suggests raising capital locally while investing globally. Building relationships with investors through local events, meetups, and networking is key. Hosting live events, one-on-one meetings, or informal gatherings like cocktail parties helps expand your network and meet potential investors.

Key Financial Metrics for Investors (00:09:24)
Investors want to know how long their money will be tied up, expected returns, and exit strategies like refinancing or selling. They compare metrics to other opportunities and also assess the team and their relationship with the syndicator.

Types of Funding for Real Estate Projects (00:12:07)
Syndicators often need both investor and lender financing. Lender financing is typically cheaper, so combining both can help maximize returns for investors. Calculating cash-on-cash returns and distributable cash is vital for assessing a project’s viability.

Determining Capital Needed for a Project (00:20:06)
Syndicators should calculate the total costs, including purchase price, closing costs (3%), acquisition fees (1-5%), capital improvement budget, operating capital, reserves, and pre-closing expenses. The amount needed from investors is the total minus lender financing.

Legal and Regulatory Requirements (00:25:44)
Syndicators must comply with securities laws, often using federal exemptions like Regulation D Rules 506(b) or 506(c). This involves preparing legal documents, filing forms with the SEC, and ensuring investors are qualified. Corporate structuring is crucial for liability protection and control.

Maintaining Control Over Projects (00:41:39)
Syndicators can maintain control by raising capital from individual investors rather than venture capitalists or private equity firms, who often want a say in decision-making. Individual investors are more likely to allow the syndicator to manage the project as long as they act in the investors' best interests.

Common Mistakes When Pitching Deals (00:43:09)
A common mistake is failing to present a clear, coherent story about the project’s vision, plan, and projected returns. Syndicators should organize information logically, explain assumptions clearly, and keep investors informed of any changes.

Fostering Long-term Investor Relationships (00:48:41)
Building lasting relationships with investors involves keeping them informed about current and future investments, market conditions, and potential impacts on deals. Listening to investors’ input and maintaining transparency helps build trust and ensures ongoing support.

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🗓️ Book a free 30-minute consultation with our business development team: https://syndicationattorneys.com/consultation

Join host Krisha Young as she interviews Isabelle Guarino of the Residential Assisted Living National Convention (RAL NAT CON). In this insightful episode, Isabelle shares her expertise on the growing field of assisted living real estate, offering a deep dive into what makes it different from traditional nursing homes and “big box” facilities.

Whether you're interested in the financial potential of owning RAL homes or wondering if now is the right time to get involved given economic uncertainties, this episode offers practical advice and strategic insights and is a must-listen for anyone considering expanding into the assisted living real estate sector.


Introduction to Residential Assisted Living (00:02:03)
Isabel Guarino explains that residential assisted living homes are single-family homes housing 6 to 16 seniors, providing the same level of care as larger facilities but with better staff-to-resident ratios of 4 or 5 to 1, compared to 30 to 1 in big box facilities. This ensures seniors receive quality care and attention.

Isabel's Personal Connection to the Industry (00:03:43)
Isabel shares her family's journey into the assisted living industry, which began when her grandmother needed 24/7 care. Her father, a real estate investor, realized he could own and operate an assisted living business and provide free care for her grandmother while generating cash flow. Although her grandmother passed before moving in, her father fell in love with the industry, and the family continued expanding their assisted living business.

Financial Potential of Assisted Living Homes (00:15:16)
Isabel provides insights into the financial potential of owning an assisted living home. With an average monthly cost of $5,500 per resident and an average of 10 residents, a home can generate $55,000 in gross monthly revenue. After expenses like mortgages ($10,000 per month) and operational costs ($35,000 per month), the owner can potentially cash flow $10,000 to $40,000 per month from a single home.

Staffing Challenges and Solutions (00:26:51)
Isabel acknowledges that staffing is one of the biggest challenges in the industry, with a national shortage of caregivers. She suggests that residential assisted living homes offer better working conditions with lower staff-to-resident ratios, making them more attractive to caregivers. She also discusses the potential of hiring immigrants with medical backgrounds from their home countries.

The Role of Technology in Assisted Living (00:31:18)
Isabel highlights the increasing role of technology in the assisted living industry, including electronic medical record systems, menu planning apps, and wearable technology that can track residents' movements, vital signs, and alert caregivers in case of emergencies.

Location Considerations for Assisted Living Homes (00:25:02)
When choosing a location for an assisted living home, Isabel recommends targeting areas with a high concentration of upper-middle-class residents aged 50 to 70, as they are often the decision-makers for placing loved ones in care.
The Residential Assisted Living National Convention (RAL NatCon) (00:39:04)
Isabel promotes the upcoming RAL NatCon conference in October 2023 in Phoenix, Arizona. The conference offers networking opportunities, educational sessions on various aspects of the assisted living industry, and insights from speakers like Kim Kiyosaki and Ed Mylett. A discount code "cashflow" is provided for listeners.

📚 Get one of our #1 Amazon best-selling books on capital Raising shipped to your house – totally free! Click this link to claim: https://syndicationattorneys.com/free-book/

🗓️ Book a free 30 minute consultation with one of our business development team: https://syndicationattorneys.com/consultation

Please join our host, Attorney Mola Bosland, as she interviews Syndication Attorneys’ long-time clients Jake Stenziano and Gino Barbaro about their new educational course, "Passive Investing Pro”. They have created this course to help passive investors learn how to protect themselves and their hard-earned investment dollars when evaluating group real estate investment opportunities. Jake and Gino will share with the audience what their passive investing course entails and how it can help ensure an alignment of interests between passive and active investors in syndicated real estate projects.

Common mistakes made by passive investors (00:02:13)

One of the biggest mistakes discussed is investing solely based on the sponsor's perceived credibility or popularity, such as having a podcast or writing a book, without verifying their actual track record and performance history with previous investors. The importance of truly knowing, liking, and trusting the sponsor is emphasized, but it is also stressed that passive investors need to go beyond that and conduct thorough due diligence.

The three-step framework: Sponsor, Alignment of Interests, and the Deal (00:06:22)

Jake and Gino introduce their three-step framework for evaluating passive investment opportunities: 1) The Sponsor (the jockey), 2) Alignment of Interests (the saddle), and 3) The Deal (the horse). They emphasize the importance of thoroughly vetting the sponsor team's experience, track record, and business plan, as well as ensuring that the interests of passive and active investors are aligned.

Evaluating the Sponsor (00:13:31)

When evaluating the sponsor, Jake and Gino recommend looking beyond just their years of experience and instead focusing on their actual track record and performance history with previous investors. They suggest asking about deals where the sponsor may have lost money and how they handled those situations.

Alignment of Interests (00:19:01)

Jake and Gino stress the importance of ensuring that the interests of passive and active investors are aligned. This includes understanding the fee structure, verifying that the sponsor has their own capital invested in the deal (skin in the game), and ensuring that the distribution of returns and cashflows is structured in a way that incentivizes the sponsor to perform well on behalf of passive investors.

Evaluating the Deal (00:21:10)

When evaluating the deal itself, Jake and Gino recommend focusing on factors like the property's vintage and condition, median income of the area, current rents versus market rents and the sponsor's assumptions for rent growth, the quality of the property management company, and the financing terms (e.g., agency debt versus bridge loans). They also suggest requesting the sponsor's underwriting assumptions, rent rolls, and other documentation to verify the deal's viability.

Current market conditions and opportunities (00:51:05)

Towards the end of the discussion, Gino expresses his belief that the current market conditions present an opportune time for investing in real estate, likening it to the 2010-2011 period following the previous recession. He encourages viewers to tune out the noise and negative sentiment, as he sees opportunities arising over the next 12-24 months for those willing to take a long-term perspective.

📚 Get one of our #1 Amazon best-selling books on capital Raising shipped to your house – totally free! Click this link to claim: https://syndicationattorneys.com/free-book/

🗓️ Book a free 30 minute consultation with one of our business development team: https://syndicationattorneys.com/consultation