#74 - The Inside Track: Mastering Real Estate Syndications for Long-Term Success

[00:00:09] [SPEAKER_02]: Welcome to Passive Income Pilots, where pilots upgrade their money. This is the

[00:00:16] [SPEAKER_02]: definitive source for personal finance and investment tactics for aviators. We

[00:00:21] [SPEAKER_02]: interview world-renowned experts and share these lessons with the flying

[00:00:24] [SPEAKER_02]: community. So if you're ready for practical knowledge and insights, let's

[00:00:29] [SPEAKER_01]: roll. Hey welcome back to Passive Income Pilots everyone, Tait Duryea here

[00:00:33] [SPEAKER_00]: another week. Ryan, how you doing man? I'm doing great, another great weekend. Got

[00:00:38] [SPEAKER_01]: to go flying actually. Heck yeah, yeah it's actually same here I got to fly the

[00:00:43] [SPEAKER_01]: BANZA this weekend we're on the mainland this week so doing some work on the

[00:00:47] [SPEAKER_00]: short-term rental actually. Oh that's fantastic. It's been fun. Yeah it was

[00:00:50] [SPEAKER_00]: kind of fun I landed in Seattle and I timed it my timing landing in Seattle

[00:00:54] [SPEAKER_00]: was faster to fly the airplane up to Anacortes for a real estate meetup

[00:00:59] [SPEAKER_00]: that I was a keynote speaker at which was really fun to fly and land at

[00:01:02] [SPEAKER_00]: an airport ten minutes away and... Oh heck yeah, something fun. Super fun. Oh can I admit

[00:01:07] [SPEAKER_00]: to that I actually when I flew the plane back to Renton, we actually flew

[00:01:12] [SPEAKER_00]: the airplane down to Minimums which and a single-ended

[00:01:16] [SPEAKER_00]: piston that's pretty rare for me to do but man that plane handles it. Yeah no

[00:01:20] [SPEAKER_00]: kidding. Like a champ I mean holy cow. Yeah I'm sure with that G1000. Yeah G1000

[00:01:25] [SPEAKER_01]: autopilot takes all the fun out of it. Well we'd like to talk about

[00:01:31] [SPEAKER_01]: passive investing today in real estate syndication what the heck is

[00:01:35] [SPEAKER_01]: passive syndication? We get a lot of questions about this. It's something that

[00:01:38] [SPEAKER_01]: Ryan and I are deep into. We've been in it for a long time and it's an

[00:01:43] [SPEAKER_01]: investment space that I wholeheartedly believe in there are some pros and

[00:01:48] [SPEAKER_01]: cons we're gonna get into that and there's some interesting things around

[00:01:51] [SPEAKER_01]: the structure of how these investment products work but at the end of the

[00:01:56] [SPEAKER_01]: day I think it's something that really serves pilots well to be

[00:01:59] [SPEAKER_01]: aware of and to know that they're out there as something they can

[00:02:04] [SPEAKER_01]: participate in. So what are your thoughts on that? You know I think people think

[00:02:08] [SPEAKER_00]: about passive investing and they think oh if I buy a rental property you know

[00:02:12] [SPEAKER_00]: I can hire a property manager and that's a passive investment but in

[00:02:17] [SPEAKER_00]: the eyes of the IRS they're absolutely right but in the

[00:02:20] [SPEAKER_00]: reality of our day-to-day I feel like if you own the property and

[00:02:24] [SPEAKER_00]: you're on title and you're the sole person that's managing it you know

[00:02:28] [SPEAKER_00]: to me that's not very passive because you know you still get the

[00:02:30] [SPEAKER_00]: calls you still have to make the decisions you still have to sign on the

[00:02:33] [SPEAKER_00]: mortgage if you take any debt and it's really not passive in my mind you know

[00:02:37] [SPEAKER_00]: I've owned and likewise you've owned rental properties and we're still called

[00:02:42] [SPEAKER_00]: to the carpet to make decisions and you know in the day-to-day lives if you

[00:02:46] [SPEAKER_00]: have kids or you know just flying the line busy trying to have a good time

[00:02:49] [SPEAKER_00]: you know those decisions get in your way of your of your daily life and

[00:02:53] [SPEAKER_00]: sometimes it requires you to go to the property sometimes it requires you

[00:02:55] [SPEAKER_00]: to find a new lender or a new property manager and man let me tell

[00:02:59] [SPEAKER_00]: you how much fun it is to go from Seattle to Philadelphia to mess around

[00:03:03] [SPEAKER_00]: with the rental property on a day off.

[00:03:05] [SPEAKER_01]: Yeah I'm dealing with it right now I have a multi-family property in

[00:03:09] [SPEAKER_01]: South Carolina and I have to shop a new insurance policy because it's gone

[00:03:13] [SPEAKER_01]: from $1,500 or something like that a month up to $4,000 and now they're

[00:03:18] [SPEAKER_01]: requiring all the tenants to have liability insurance and I have a

[00:03:21] [SPEAKER_01]: property manager and I'm dealing with this for hours a week with

[00:03:25] [SPEAKER_01]: this insurance thing trying to figure out how the property manager is

[00:03:28] [SPEAKER_01]: going to get the tenants on you know liability insurance and it is it's

[00:03:31] [SPEAKER_01]: anything but passive so this is why so about seven years ago I took a hard

[00:03:37] [SPEAKER_01]: left turn and found syndications and I've never looked back.

[00:03:41] [SPEAKER_00]: I think that's what really begs like you know what what is truly passive

[00:03:44] [SPEAKER_00]: and you know we can talk about all the different things but you know I

[00:03:47] [SPEAKER_00]: think that's where if you don't want to be managing the day-to-day and

[00:03:50] [SPEAKER_00]: you don't want to be doing the work that might be required you know

[00:03:53] [SPEAKER_00]: syndication might be a perfect thing for you to take a look at there's

[00:03:57] [SPEAKER_00]: types of real estate that you can get it to that is passive but you know

[00:04:01] [SPEAKER_00]: syndication is a great tool for for someone who's looking to really be like

[00:04:06] [SPEAKER_00]: set it and forget it and but there's also some downsides and you know I

[00:04:10] [SPEAKER_00]: want to cover the downside as well you know on the show today.

[00:04:14] [SPEAKER_01]: Absolutely so before we get into the downside let's talk about structure so

[00:04:18] [SPEAKER_01]: what is a syndication Ryan? Well syndication you know for all intents

[00:04:22] [SPEAKER_00]: and purposes it's just a bunch of people coming together that are passive

[00:04:25] [SPEAKER_00]: and investing pooling capital together to go buy property real property and so

[00:04:31] [SPEAKER_00]: usually that means that they invest as limited partners or LPs and they're

[00:04:35] [SPEAKER_00]: investing in a limited partnership interest in an LLC that will actually

[00:04:39] [SPEAKER_00]: take title on the property so effectively you're not really even

[00:04:42] [SPEAKER_00]: investing directly in the real estate you're investing indirectly onto a an

[00:04:46] [SPEAKER_00]: entity that owns the asset and there's typically a partner involved

[00:04:50] [SPEAKER_00]: they're called a GP or a general partner who's going to be doing all

[00:04:53] [SPEAKER_00]: the things that we just talked about you know just making decisions on insurance

[00:04:56] [SPEAKER_00]: and property taxes operations flying to see the property and doing the things

[00:05:01] [SPEAKER_00]: that maybe you're not very interested in doing or maybe you're not skilled

[00:05:04] [SPEAKER_00]: in doing and so that essentially is what makes up a syndication just a

[00:05:08] [SPEAKER_00]: bunch of people getting together and pooling capital and usually that GP

[00:05:11] [SPEAKER_00]: that is running the business will find all the investors and arrange all

[00:05:16] [SPEAKER_00]: the investors come together to do the investment. Right they're putting

[00:05:19] [SPEAKER_01]: together the equity which is the money that's coming from investors

[00:05:23] [SPEAKER_01]: they're also putting together the debt negotiating property and putting it on

[00:05:26] [SPEAKER_01]: contract and actually acquiring it and they do all the work which is why I

[00:05:31] [SPEAKER_01]: was so attracted to this style of investing. I really think that a great

[00:05:35] [SPEAKER_01]: analogy is a commercial flight you know you can go out you could buy

[00:05:40] [SPEAKER_01]: 152 and you can fly it from LA to New York but there's a more efficient

[00:05:44] [SPEAKER_01]: way to get there which is buy a ticket on a commercial airliner and you

[00:05:47] [SPEAKER_01]: could sit in the back and sleep and so you kind of think of all the

[00:05:50] [SPEAKER_01]: passengers that are in the back as LPs as limited partners and the flight

[00:05:55] [SPEAKER_01]: crew and the dispatcher and the whole organization of the airline as the GP

[00:06:01] [SPEAKER_01]: team. Are they the ones that are deciding what route to fly and you

[00:06:04] [SPEAKER_01]: decide whether you want to get on that airplane or not or whether it's a

[00:06:07] [SPEAKER_01]: safe airplane to get on. Of course there are risks no matter what but some

[00:06:11] [SPEAKER_01]: airplanes are safer to get on than others and we'll get into that. Yeah

[00:06:14] [SPEAKER_00]: great analogy the other thing he brought up which I think is really

[00:06:17] [SPEAKER_00]: important is the debt because if you're doing your own deal you're probably

[00:06:20] [SPEAKER_00]: signing on your own debt which means you're going to carry all that

[00:06:23] [SPEAKER_00]: liability right in addition to the equity that you put into the deal so

[00:06:26] [SPEAKER_00]: you know let's say you buy a rental property for a million dollars and

[00:06:29] [SPEAKER_00]: you're putting down five hundred thousand dollars of your own money

[00:06:32] [SPEAKER_00]: well chances are you're gonna take a loan and you're gonna be

[00:06:34] [SPEAKER_00]: responsible for that five hundred thousand dollars of debt that you put

[00:06:38] [SPEAKER_00]: on the asset so you're not just risking your equity you're risking

[00:06:41] [SPEAKER_00]: your equity plus the debt and so we invest in a syndication usually the

[00:06:46] [SPEAKER_00]: operator or the GP is going to be taking on the accountability of the

[00:06:49] [SPEAKER_00]: debt sometimes they might get a non recourse loan but for the most part

[00:06:52] [SPEAKER_00]: many times they'll get a recourse loan. Let's break that down what's it what

[00:06:55] [SPEAKER_01]: what's the difference between a recourse and non recourse loan? Yeah I

[00:06:58] [SPEAKER_00]: really love this so typically recourse there's lots of scalability to

[00:07:02] [SPEAKER_00]: recourse so recourse can be limited and it can be unlimited

[00:07:06] [SPEAKER_00]: meaning that the recourse might be limited to just the property and so

[00:07:11] [SPEAKER_00]: if the property goes into foreclosure or somebody doesn't make a payment

[00:07:13] [SPEAKER_00]: on it the bank can come in and they can take the property back and go to a

[00:07:18] [SPEAKER_00]: hundred percent recourse which means that they're gonna take the property

[00:07:20] [SPEAKER_00]: back and that usually means that they're gonna take out all the equity

[00:07:24] [SPEAKER_00]: that was put up for the property until they're made whole and or they

[00:07:28] [SPEAKER_00]: might go a little bit further than that and actually go for the personal

[00:07:33] [SPEAKER_00]: guarantee that's on the loan maybe you the investor that signed on the

[00:07:36] [SPEAKER_00]: debt if it's recourse and sometimes there's unlimited guarantees on loans

[00:07:40] [SPEAKER_00]: which you got to be really careful of which means it could go beyond the

[00:07:44] [SPEAKER_00]: property itself in order to recruit the money that's been potentially put a

[00:07:50] [SPEAKER_00]: jeopardy by the bank so that means they could come after your house they

[00:07:52] [SPEAKER_00]: could come after your personal assets it could get pretty gnarly. A non

[00:07:56] [SPEAKER_00]: recourse loan basically means that you're you don't have any personal

[00:08:00] [SPEAKER_00]: liability necessarily financially so if the property fails you might be able

[00:08:05] [SPEAKER_00]: to walk away free and clear from any personal obligation so you see there's

[00:08:10] [SPEAKER_00]: a lot of Fannie Freddie Mac loans with multifamily bigger projects projects

[00:08:15] [SPEAKER_00]: that are more stabilized you might get a non recourse loan the thing to think

[00:08:19] [SPEAKER_00]: about though it would not recourse is they have this thing called bad boy

[00:08:21] [SPEAKER_00]: carve outs which is just a fancy way of saying that there's a list of

[00:08:25] [SPEAKER_00]: things where if the operator acts in bad faith or does something negligent

[00:08:30] [SPEAKER_00]: they could trip the bad boy carve outs and that would mean that they

[00:08:33] [SPEAKER_00]: would then become liable for those loans so I know we're way off into

[00:08:37] [SPEAKER_00]: weeds but no this is good yeah it does kind of highlight the fact that you know

[00:08:41] [SPEAKER_00]: when you're getting into a syndication you know just understand the players

[00:08:45] [SPEAKER_00]: on the field right these guys may or may not be taking or gals may be

[00:08:49] [SPEAKER_00]: taking debt that is recourse or non recourse they're assuming that

[00:08:52] [SPEAKER_00]: liability they're going out finding that debt for you they're raising

[00:08:55] [SPEAKER_00]: up there you know you might only be investing 50 or $100,000 in

[00:08:59] [SPEAKER_00]: syndication and they're going out and finding the other you know four

[00:09:02] [SPEAKER_00]: five ten twenty million dollars that's required to do the deal and then you

[00:09:07] [SPEAKER_00]: get the benefit from their professional management on the asset before we leave

[00:09:11] [SPEAKER_01]: recourse and non recourse I just want to to step on that again because the

[00:09:16] [SPEAKER_01]: the way that I think about this and just to clarify for listeners if they're

[00:09:19] [SPEAKER_01]: still not quite quite good then is that when you get a recourse loan it's

[00:09:23] [SPEAKER_01]: like when you're buying a house right the bank doesn't care about the

[00:09:26] [SPEAKER_01]: house they care about you they're looking at your tax returns your

[00:09:30] [SPEAKER_01]: ability to pay that loan back and if you stop paying it they're gonna take back

[00:09:35] [SPEAKER_01]: the house but if the house isn't worth enough to pay them back what they're

[00:09:39] [SPEAKER_01]: owed they're gonna come after you personally and then on the non recourse

[00:09:43] [SPEAKER_01]: side you know as what you know alluding to what you're saying or if

[00:09:46] [SPEAKER_01]: you're buying a 20 plus million dollar property the bank doesn't really

[00:09:50] [SPEAKER_01]: care about you know you and your financial picture on the GP side

[00:09:54] [SPEAKER_01]: they're looking more at the deal they want to see that the deal can

[00:09:58] [SPEAKER_01]: afford itself and that's where they're they're willing to offer what's called

[00:10:02] [SPEAKER_01]: that non recourse loan where they're saying hey if this goes south we're gonna

[00:10:06] [SPEAKER_01]: take back the property but as long as there was no fraudulent or negligence

[00:10:09] [SPEAKER_01]: activity here that's gonna be the end of it we're not gonna come after you

[00:10:14] [SPEAKER_01]: if there's there's additional money that we lost out on as the bank that

[00:10:17] [SPEAKER_01]: the asset isn't sufficient to cover you're gonna give the keys back to

[00:10:21] [SPEAKER_01]: the bank and that's gonna be it would you agree with that just just

[00:10:24] [SPEAKER_00]: Yeah and I think it necessarily you know because there's some deals that you know

[00:10:29] [SPEAKER_00]: all deals the banks look at are gonna have to be signed off and the deal has

[00:10:33] [SPEAKER_00]: kind of stand on itself I think when you think about you know and the

[00:10:38] [SPEAKER_00]: borrower in all cases has to be qualified for that loan that usually

[00:10:42] [SPEAKER_00]: means this is another good point too which I'm glad we're talking about

[00:10:46] [SPEAKER_00]: debt because you know you not that definitely you the investor not going

[00:10:49] [SPEAKER_00]: out having to get the debt is a big freaking deal yeah because if it's

[00:10:53] [SPEAKER_00]: $20 million loan that usually means that the borrower has to have a hundred

[00:10:59] [SPEAKER_00]: percent of the loan value and net worth so that would mean you'd have to be

[00:11:02] [SPEAKER_00]: worth twenty million dollars get that loan and typically you have to have ten

[00:11:06] [SPEAKER_00]: percent of the liquidity of the loan amount so that means that you'd have

[00:11:10] [SPEAKER_00]: to have about two million dollars in the bank and so you know when you

[00:11:14] [SPEAKER_00]: when you think about you know hey you know I want to go buy a twenty

[00:11:17] [SPEAKER_00]: million dollar property if you don't have twenty million dollars of net

[00:11:19] [SPEAKER_00]: worth and two million dollars of liquidity the banks gonna look at you as

[00:11:23] [SPEAKER_00]: you know probably not somebody who only by themselves get the loan that you

[00:11:27] [SPEAKER_00]: probably have to go out and find another person to co-sign on that loan

[00:11:31] [SPEAKER_00]: and you become a co-signer so there's actually quite a bit of opportunities

[00:11:35] [SPEAKER_00]: out there where if you do have good net worth and liquidity that means

[00:11:38] [SPEAKER_00]: that you could become a co-signer and get actual credit in the deal or

[00:11:43] [SPEAKER_00]: ownership of the deal for just being a guarantor in a syndication and a

[00:11:49] [SPEAKER_00]: yeah exactly a lot of people and I know I know many many people that do that

[00:11:53] [SPEAKER_00]: because you know these loans are sometimes 60 70 80 million dollars

[00:11:56] [SPEAKER_00]: syndication and they may not have that net worth and liquidity the other thing

[00:12:00] [SPEAKER_00]: the bank's gonna look at too is your experience you know they're not gonna

[00:12:03] [SPEAKER_00]: just hand the keys to a 60 million dollar property if you don't have the

[00:12:07] [SPEAKER_00]: experience to sign on the sign on the loan so sometimes you hear the word

[00:12:12] [SPEAKER_00]: KP or or key principal you know GP the general partner whatever it might

[00:12:17] [SPEAKER_00]: be a list of people in the syndication and sometimes there's a you know

[00:12:21] [SPEAKER_00]: copilot for lack of a better term where you know hey the captain maybe have a

[00:12:26] [SPEAKER_00]: lot of experience and be seasoned on the aircraft is flying with somebody

[00:12:30] [SPEAKER_00]: less experienced maybe think of it as a line check airman student pilot you

[00:12:34] [SPEAKER_00]: know kind of piloted training scenario where you know you've got the more

[00:12:38] [SPEAKER_00]: seasoned GP and the KP is kind of coming along to the ride and getting

[00:12:41] [SPEAKER_00]: the experience and that way the KP on the next deal they might be able to

[00:12:44] [SPEAKER_00]: get that loan all by themselves the GP because they have the experience of

[00:12:48] [SPEAKER_00]: doing a deal previously so you know all in all you know just make sure that

[00:12:54] [SPEAKER_00]: you know like Tate alluded to with that analogy don't make sure you're

[00:12:57] [SPEAKER_00]: getting on an airplane that has the range to go across the country and as

[00:13:02] [SPEAKER_00]: the pilots and then experience do it you know my my caution is always be

[00:13:06] [SPEAKER_00]: leery of the student pilot deals because there's student pilot deals all

[00:13:09] [SPEAKER_00]: the time you know somebody goes and takes a crash course you know in

[00:13:13] [SPEAKER_00]: you know they learn how to raise money a little bit and then all of a sudden

[00:13:16] [SPEAKER_00]: they're you know they're raising their money for their first deal and they

[00:13:20] [SPEAKER_00]: have no experience they have no team you know they maybe just grab random

[00:13:24] [SPEAKER_00]: people in the in the mentorship program to be their their co-signer

[00:13:27] [SPEAKER_00]: those deals can be they could be lucrative but you know I kind of

[00:13:31] [SPEAKER_00]: call those magician deals where if it works out it's probably because they

[00:13:34] [SPEAKER_00]: got lucky not because they have a team that you know is super well

[00:13:38] [SPEAKER_00]: first in operations and experience so and not to knock anyone but we know

[00:13:42] [SPEAKER_01]: we've seen that quite a bit in the last decade because you know a rising tide

[00:13:46] [SPEAKER_01]: lifts all ships and it has masked the naivety of a lot of you know student

[00:13:52] [SPEAKER_01]: pilots out there and that came to a head a couple years ago with it with

[00:13:55] [SPEAKER_01]: the interest rate rise and there's a lot of deals that are on the rocks right now

[00:13:58] [SPEAKER_00]: yeah that's exactly what I was going to bring up which is you know you

[00:14:02] [SPEAKER_00]: probably if you're doing your due diligence on what the heck a

[00:14:04] [SPEAKER_00]: syndication is and I saw a couple of posts about this you know you're gonna

[00:14:08] [SPEAKER_00]: be poking around and you're gonna hear the good bad and the ugly you're

[00:14:10] [SPEAKER_00]: a lot of ugly right now because there's a lot of people that you know not a lot

[00:14:14] [SPEAKER_00]: of people but there's some deals that were probably good deals and well

[00:14:18] [SPEAKER_00]: underwritten but as soon as the Fed started raising rates you know the

[00:14:21] [SPEAKER_00]: deal didn't support the rising interest rate environment and very quickly some

[00:14:26] [SPEAKER_00]: of these deals went bad and so you have to know in a syndication that you

[00:14:30] [SPEAKER_00]: know the you can lose your money you can lose all your money just like

[00:14:32] [SPEAKER_00]: just like any investing that you do and I think it's important for

[00:14:35] [SPEAKER_00]: people to understand that going in is you know things could look very rosy

[00:14:39] [SPEAKER_00]: at the beginning when you look at the offering memorandum that's the little

[00:14:42] [SPEAKER_00]: prospectus that you look at you know and there's there's lots of projections

[00:14:46] [SPEAKER_00]: and things that you know if it all goes well you do great but there also

[00:14:51] [SPEAKER_00]: have been deals that are subject to external factors that have caused

[00:14:56] [SPEAKER_00]: people to turn in the keys to deals and a complete equity loss nobody is

[00:15:00] [SPEAKER_00]: completely protected from that nobody is and they know and no investment

[00:15:04] [SPEAKER_00]: is completely safe just something to be aware of yeah well I think it's

[00:15:07] [SPEAKER_01]: important to take a step back as well when you're looking at you know real

[00:15:12] [SPEAKER_01]: estate as a cyclical industry and instead of trying to time the market

[00:15:17] [SPEAKER_01]: to spend time in the market and the I think I've said this on the show

[00:15:21] [SPEAKER_01]: before you know the wrong way to invest in real estate is try it once

[00:15:25] [SPEAKER_01]: and if it doesn't go well just yeah I'll say well that didn't work it's

[00:15:29] [SPEAKER_01]: it's a it's a long game and it's a you know real estate has very high

[00:15:33] [SPEAKER_01]: probability of success if you stay in it for the long run but I think it's

[00:15:37] [SPEAKER_01]: important to be investing in all parts of the market cycle because you really you

[00:15:40] [SPEAKER_01]: know no one has a crystal ball but we you could certainly see where there are

[00:15:45] [SPEAKER_01]: times where their headwinds and tailwinds so in any case let's get into

[00:15:49] [SPEAKER_01]: I think I think we kind of covered the nuts and bolts should we get into

[00:15:52] [SPEAKER_00]: pros cons yeah I'd love to start with the cons right we're all pilots

[00:15:56] [SPEAKER_00]: we want it we want to hear the risks right yeah yeah what are the

[00:15:59] [SPEAKER_00]: downsides so let's just dive into that so I would say here are your

[00:16:03] [SPEAKER_00]: top five downsides you know first of all if you get into a syndication you have

[00:16:08] [SPEAKER_00]: to know that it's completely illiquid nine times out of ten it's gonna be a

[00:16:12] [SPEAKER_00]: liquid so you know if you've got a hundred thousand bucks and you want to

[00:16:16] [SPEAKER_00]: invest in that a syndication well guess what you're not gonna get that

[00:16:19] [SPEAKER_00]: money back most secations do not offer any quiddity so just know that

[00:16:25] [SPEAKER_00]: the money that you're investing a you'll want to be able to know that

[00:16:28] [SPEAKER_00]: you could completely lose that money and it won't make a difference in

[00:16:31] [SPEAKER_00]: your life and two you've got to be able to part with that money because you

[00:16:35] [SPEAKER_00]: know there's no there's no guarantees of liquidity and there's some funds out

[00:16:40] [SPEAKER_00]: there again that are open-ended funds but they're very rare typical

[00:16:44] [SPEAKER_00]: syndications have a three to seven year time frame and they're gonna

[00:16:48] [SPEAKER_00]: involve buying property repositioning the property to raise rents and

[00:16:54] [SPEAKER_00]: increase operations and then within three to seven years the operator will

[00:16:58] [SPEAKER_00]: likely either refinance that property it send your money back or they'll

[00:17:00] [SPEAKER_00]: sell the property and and that's how you'll be given your money back but in

[00:17:05] [SPEAKER_00]: the interim it's really out of your control and the timing is out of your

[00:17:10] [SPEAKER_00]: control to get that money back so just know that it's illiquid now if you

[00:17:13] [SPEAKER_00]: invest in an open-ended fund like you know there's some debt funds out

[00:17:16] [SPEAKER_00]: there that maybe offer redemption period but like check the disclaimers

[00:17:20] [SPEAKER_00]: on that because you know typically yeah yeah if there's a run they might not

[00:17:24] [SPEAKER_00]: be able to give it back exactly and there's gonna be all kinds of

[00:17:28] [SPEAKER_00]: and their agreements buried in the PPM that say hey you know we we offer this

[00:17:33] [SPEAKER_00]: redemption except when we don't then we don't have the money available right

[00:17:36] [SPEAKER_00]: so you know just just know I you know just kind of go in assuming that the

[00:17:41] [SPEAKER_00]: money's illiquid and that you could have it tied up absolutely just just

[00:17:45] [SPEAKER_01]: real quick you know I think of it like the down payment on investment

[00:17:49] [SPEAKER_01]: property you know you that money's tied up in the property so until you

[00:17:53] [SPEAKER_01]: sell it it's stuck there it's in the house right and it's the exact

[00:17:57] [SPEAKER_01]: same thing as if you were investing actively now because you're a passenger

[00:18:02] [SPEAKER_01]: on the airplane you got to think of it from the pilot's perspective the

[00:18:05] [SPEAKER_01]: pilots are gonna be doing the best that they can to guide that aircraft

[00:18:08] [SPEAKER_01]: safely to its intended destination and if they run into a wall of

[00:18:12] [SPEAKER_01]: thunderstorms and take a deviation the the passengers have to understand

[00:18:17] [SPEAKER_01]: that it's in the best interest for them and for the the general partners

[00:18:22] [SPEAKER_01]: because when the general partners make money the investors make money and

[00:18:26] [SPEAKER_01]: so everyone's kind of on that same ship so just something to understand in

[00:18:31] [SPEAKER_01]: terms of the illiquidity that if the market conditions change a deal could

[00:18:34] [SPEAKER_01]: hold longer because it's in the best interest of everyone and that's a

[00:18:38] [SPEAKER_01]: decision that's being made by the general partnership team so I just wanted

[00:18:40] [SPEAKER_00]: to put a pin in that yeah and the next thing the number two thing is

[00:18:44] [SPEAKER_00]: it might delay your tax return you know you might be you might take

[00:18:47] [SPEAKER_00]: great pride in getting your 1040 you know getting your airline w-2 in

[00:18:52] [SPEAKER_00]: January and getting you all of your things together and then having your

[00:18:56] [SPEAKER_00]: tax return done maybe in the February March time frame you know when you get

[00:18:59] [SPEAKER_00]: into a syndication you kind of take that out of your control it's very

[00:19:04] [SPEAKER_00]: possible that the operator doesn't give you your tax return until

[00:19:07] [SPEAKER_00]: August or September so you might be filing an extension when you get

[00:19:11] [SPEAKER_00]: into this type of investing you're investing in partnerships and

[00:19:14] [SPEAKER_00]: partnership creates 1065 and then you get a K-1 typically and that K-1 could

[00:19:18] [SPEAKER_00]: take a few months after the deadline to get into your hands so if you're going

[00:19:24] [SPEAKER_00]: to invest in a syndication I would just go ahead and assume that you're gonna

[00:19:28] [SPEAKER_00]: have to extend your taxes now extending your taxes doesn't cost you

[00:19:31] [SPEAKER_00]: anything sometimes you know it and so there's some things that I want to

[00:19:35] [SPEAKER_00]: talk about there too you have a big profitable year in your investing

[00:19:39] [SPEAKER_00]: world and you extend your taxes just remember you've got to make

[00:19:43] [SPEAKER_00]: estimated quarterly payments and if you don't make estimated quarterly

[00:19:47] [SPEAKER_00]: payments you're gonna get penalized on the money that you didn't make

[00:19:51] [SPEAKER_00]: your estimated quarterly payments on so just be aware have your CPA in your

[00:19:55] [SPEAKER_00]: back pocket make sure that they know that you are in a syndication and that

[00:20:00] [SPEAKER_00]: likely your K-1 is going to be delayed beyond the the April filing

[00:20:05] [SPEAKER_00]: date that you have I would just go ahead and if you set your expectation

[00:20:09] [SPEAKER_00]: right then when you get your K-1 in March you'll be like oh cool they got

[00:20:13] [SPEAKER_00]: it to me you know relatively early let's let's go ahead I you know I didn't use

[00:20:18] [SPEAKER_00]: the word on time on purpose because on time doesn't necessarily mean March it

[00:20:22] [SPEAKER_00]: could on time the operator could be you know July or August and it's just

[00:20:27] [SPEAKER_00]: just something that goes along with it you know we strive to get all of

[00:20:31] [SPEAKER_00]: our K-1s out at the March time frame but again there's so many

[00:20:34] [SPEAKER_00]: different tax codes that change there's things that pop up you know

[00:20:38] [SPEAKER_00]: there's circumstances with the CPA that could result in your K-1

[00:20:42] [SPEAKER_00]: getting delayed beyond March so just something to think about the next thing I

[00:20:46] [SPEAKER_00]: wanted to talk about and I and I kind of alluded to this in the illiquidity of

[00:20:50] [SPEAKER_00]: that but you have no control you know you can't just go barge into the

[00:20:53] [SPEAKER_00]: flight deck and and tell tell tell the pilots what else to do to fly at

[00:20:57] [SPEAKER_00]: right they I mean they might entertain something but ultimately here

[00:21:01] [SPEAKER_00]: not you're not in the flight deck you're not flying the plane you're a

[00:21:03] [SPEAKER_00]: passenger you're not in control there really is no I mean there might be

[00:21:07] [SPEAKER_00]: voting rights described in the operating agreement but you're such a

[00:21:10] [SPEAKER_00]: fraction of the investment control and in a situation like that you're not

[00:21:15] [SPEAKER_00]: going to have really many if any voting rights and you really can't

[00:21:19] [SPEAKER_00]: control when they buy itself or refinance property you really can't

[00:21:23] [SPEAKER_00]: control anything that happens so if you're this comes with it you know

[00:21:27] [SPEAKER_00]: what we talked about earlier it's a double-edged sword you know you don't

[00:21:30] [SPEAKER_00]: have to make the decisions all the time and and you don't have to be at

[00:21:34] [SPEAKER_00]: the wheel all the time but you know you're really it's really out of your

[00:21:37] [SPEAKER_00]: control so it's just something to think about the next thing is potential lower

[00:21:43] [SPEAKER_00]: upside so I put a big asterisk next to this so you know usually when you do

[00:21:47] [SPEAKER_00]: your own deal you're you know you put up all the money you put you you take

[00:21:51] [SPEAKER_00]: on all the debt and so naturally if you're gonna do that I would make sure

[00:21:56] [SPEAKER_00]: that your return is going to be better right because there's a there's

[00:22:00] [SPEAKER_00]: a phantom or a stealth cost to doing your own deal which is your own time

[00:22:05] [SPEAKER_00]: right in your in your time has value so if you do your own deal and I would

[00:22:10] [SPEAKER_00]: expect you to make a lot more than a syndication and if you're not then

[00:22:14] [SPEAKER_00]: you're not probably not valuing your time correctly so you know think of

[00:22:19] [SPEAKER_00]: it this way if you go out and buy rental property some people think oh

[00:22:22] [SPEAKER_00]: well I just spend a couple hours a month on that but think of the time

[00:22:24] [SPEAKER_00]: you had to spend on finding that rental property financing it putting a

[00:22:28] [SPEAKER_00]: property manager in place inspecting the asset any repairs that needed to go

[00:22:33] [SPEAKER_00]: like you've got to think about all the time that you're spending on it

[00:22:36] [SPEAKER_00]: something and how it impacts your your overall upside potential you know a

[00:22:42] [SPEAKER_00]: syndication might be a lower overall projected return but think about the

[00:22:46] [SPEAKER_00]: time savings you get from it but just know that you know it would be

[00:22:49] [SPEAKER_00]: natural to expect a syndication where you're sharing in the profits to be

[00:22:54] [SPEAKER_00]: lower than something that you do want grow absolutely yeah and in the last

[00:22:59] [SPEAKER_00]: we know one that I kind of wanted to point out and this is probably

[00:23:02] [SPEAKER_00]: the point of our entire podcast date is you know to kind of help people do this

[00:23:07] [SPEAKER_00]: but you don't know how to vet like you don't have you don't know how to find

[00:23:11] [SPEAKER_00]: a syndication you don't know how to that's a syndication you don't know you

[00:23:15] [SPEAKER_00]: know we if you're if you're getting on an airplane with a pilot with no

[00:23:18] [SPEAKER_00]: experience or a pilot with a lot of experience you don't know it is you

[00:23:21] [SPEAKER_00]: don't know how to see behind the curtain to see if they have a dispatch

[00:23:24] [SPEAKER_00]: team and a world-class maintenance department that's gonna make sure the

[00:23:27] [SPEAKER_00]: and up to spec so you know that is a big thing and you know I always tell

[00:23:34] [SPEAKER_00]: people don't swing at the first pitch who get to know some syndicates get on

[00:23:40] [SPEAKER_00]: their they get on their list watch the deals go by talk to their team

[00:23:45] [SPEAKER_00]: multiple times ask some questions find your own referrals you know find

[00:23:49] [SPEAKER_00]: people that have invested with them but really you know that's that could

[00:23:52] [SPEAKER_00]: be a downside as you don't you know that's okay this is great I don't

[00:23:55] [SPEAKER_00]: want to do my own deal I want to find my own syndication but you

[00:23:57] [SPEAKER_00]: really don't know how to bet the person and I and I would say we'd like

[00:24:00] [SPEAKER_00]: to offer some guidance on that on this call but you know there isn't really a

[00:24:05] [SPEAKER_00]: one-size-fits-all approach to that and that's you know something that could

[00:24:10] [SPEAKER_00]: that could be a downside that you want to add anything to that yeah it's

[00:24:13] [SPEAKER_01]: such a good list of cons I think it's it's you know you want to go into

[00:24:17] [SPEAKER_01]: this stuff eyes wide open you know Ryan and I have both had terrible

[00:24:21] [SPEAKER_01]: experiences investing in syndications it didn't stop us from continuing to

[00:24:25] [SPEAKER_01]: do so but that's really bad once I mean I've lost all my money in a roundup

[00:24:31] [SPEAKER_01]: development deal it was back when I I didn't know how to vet I didn't know

[00:24:35] [SPEAKER_01]: how to vet the team and it just I swung it at a pitch and I didn't really

[00:24:39] [SPEAKER_01]: really understand the context within it I would definitely want one piece of

[00:24:45] [SPEAKER_01]: advice I would give new investors is when you're talking to the general

[00:24:49] [SPEAKER_01]: partnership team and you're trying to get a sense for should I place my

[00:24:52] [SPEAKER_01]: money with them it should make sense and one of the mistakes that I made in that

[00:24:57] [SPEAKER_01]: deal that I lost all my money was you know I asked questions and I got an

[00:25:02] [SPEAKER_01]: answer and it didn't make full sense to me and had I just continued to ask

[00:25:07] [SPEAKER_01]: questions and and pick at that scab for long enough I think it would have

[00:25:13] [SPEAKER_01]: become clear that that you know this team didn't know what they were

[00:25:15] [SPEAKER_01]: talking about so good if you just continue asking questions and you

[00:25:21] [SPEAKER_01]: don't stop until it makes sense it's like hey explain this to me like a five

[00:25:25] [SPEAKER_01]: year old because if you if you keep doing that you're gonna finally get to

[00:25:30] [SPEAKER_01]: a place where you either understand it or you don't understand it and at

[00:25:34] [SPEAKER_01]: that point personally I would walk away yeah and it's not to say I mean

[00:25:38] [SPEAKER_00]: you know we we both had syndications go poorly but we've also

[00:25:41] [SPEAKER_00]: had some syndications go really really well absolutely and again I

[00:25:45] [SPEAKER_00]: mean this is like any investing right like how many people have lost money

[00:25:49] [SPEAKER_00]: in the stock market like I know I have and I've also made money in the stock

[00:25:52] [SPEAKER_00]: market yeah crypto I mean you know I think that's the point that I you know

[00:25:58] [SPEAKER_00]: definitely in the last decade or so of doing this it's like this is just

[00:26:01] [SPEAKER_00]: investing that's all it is it's just another tool it's another tool it's

[00:26:05] [SPEAKER_00]: another way that people get out there and get invested in real estate

[00:26:09] [SPEAKER_00]: and it comes with a lot of advantages and benefits but yeah again I think

[00:26:14] [SPEAKER_00]: like Tate said being in the airplanes like you know I really just

[00:26:18] [SPEAKER_00]: don't feel comfortable with this approach and you don't really know why

[00:26:21] [SPEAKER_00]: maybe you feel rushed maybe you feel like you don't you just don't

[00:26:23] [SPEAKER_00]: understand the big picture that same feeling you're gonna have an

[00:26:27] [SPEAKER_00]: investing and that's okay and I think asking those questions and to the point

[00:26:31] [SPEAKER_00]: where you like you said you feel comfortable almost letting the

[00:26:33] [SPEAKER_00]: operator kind of educate you a little bit and just even though you're

[00:26:37] [SPEAKER_00]: just no no that you're gonna go around or gonna break it off or you're

[00:26:40] [SPEAKER_00]: not gonna actually do it but you're just gonna kind of tease it out and

[00:26:43] [SPEAKER_00]: then maybe come back for the next one and and think about doing the deal

[00:26:47] [SPEAKER_00]: itself my my lippness test for syndications is always I know this is I

[00:26:52] [SPEAKER_00]: don't know this is like a good idea or bad idea but if you can find the

[00:26:55] [SPEAKER_00]: operator on Google and they have a few reviews and they have a team beyond

[00:27:01] [SPEAKER_00]: just them that's usually a good sign right like if you have a reputation

[00:27:05] [SPEAKER_00]: to lose on the internet at a minimum you know and look read the tea leaves

[00:27:11] [SPEAKER_00]: right if they've got ten complaints about non-payment of contractors and you

[00:27:18] [SPEAKER_00]: know they've got a couple of stars and a couple of investors you know

[00:27:21] [SPEAKER_00]: handful investors on there saying things like this guy disappeared with

[00:27:24] [SPEAKER_00]: my money and whatever whatever might be or they're changing the name of

[00:27:28] [SPEAKER_00]: their company every couple of years yeah that's probably ask me how I know

[00:27:33] [SPEAKER_00]: and there's nothing wrong I mean you know we have the ability to kind of

[00:27:37] [SPEAKER_00]: get around the country fairly easily without much stress compared to most

[00:27:41] [SPEAKER_00]: people go meet the person go walk the go walk the the project and you know we

[00:27:47] [SPEAKER_00]: might not have time but it's a good idea to check it out I mean I've actually

[00:27:52] [SPEAKER_00]: had some larger investors where you know we've flown them down to the

[00:27:55] [SPEAKER_00]: property and said it go meet our regional manager and go walk the

[00:27:58] [SPEAKER_00]: property itself and taste it touch it feel it like ask questions get

[00:28:03] [SPEAKER_00]: really comfortable with what you're doing and that's that's good but for

[00:28:07] [SPEAKER_00]: crying out loud make sure you just put the person in Google right like

[00:28:10] [SPEAKER_00]: that's you know step one just make sure that you know you've googled the person

[00:28:14] [SPEAKER_00]: and you haven't found a million things and also don't be afraid if

[00:28:18] [SPEAKER_00]: somebody's gotten a couple of dings and dents I mean that's kind of a

[00:28:22] [SPEAKER_00]: that's kind of a sign that they've been through stuff I mean somebody

[00:28:26] [SPEAKER_00]: who's got no like it's like a private pilot it's like I haven't

[00:28:29] [SPEAKER_00]: she I failed a single check ride it's like well you've only taken one

[00:28:32] [SPEAKER_01]: check right yeah exactly everybody's got a PSAP report right if they if

[00:28:37] [SPEAKER_01]: they've been in the airlines long enough so yeah that's not a big deal

[00:28:40] [SPEAKER_00]: yeah you want to see a track record yeah and yeah track record is you

[00:28:44] [SPEAKER_00]: know it doesn't mean you know home run on every deal they've ever done you

[00:28:49] [SPEAKER_00]: know track record you know it means they've got a track record I think

[00:28:52] [SPEAKER_01]: it's better if every deal hasn't been a home run and that there has

[00:28:56] [SPEAKER_01]: been some deals that have not gone swimmingly because what do we say

[00:29:00] [SPEAKER_01]: it's like you either look you either succeed it or you learn and you

[00:29:04] [SPEAKER_01]: want to be with a GP team that has learned a few things after stumbling

[00:29:10] [SPEAKER_00]: yeah and how they had how they handled it and how they responded is

[00:29:14] [SPEAKER_00]: huge absolutely yeah and there's a lot of stuff I really like what you said

[00:29:18] [SPEAKER_00]: Tate about you know making sure it makes sense to you because I think

[00:29:22] [SPEAKER_00]: there's a lot of things out there like oh here's 85 questions you

[00:29:26] [SPEAKER_00]: should ask your sponsor before investing and it's like that those

[00:29:31] [SPEAKER_00]: are probably really great questions but the problem is is you don't

[00:29:34] [SPEAKER_00]: really know what makes a great answer and the questions could be just

[00:29:38] [SPEAKER_00]: confusing you more when you're really just trying to get your arms around

[00:29:41] [SPEAKER_00]: what's going on and how it works here's the other thing building

[00:29:45] [SPEAKER_00]: mutual trust and respect you should never feel pressured ever absolutely any

[00:29:52] [SPEAKER_00]: reason whatsoever like there is not a once-in-a-lifetime deal ever there

[00:29:58] [SPEAKER_00]: always another deal and it's like it's like airline accidents while we got a

[00:30:04] [SPEAKER_00]: lot of analogies today like airline accidents right the Sun is always

[00:30:07] [SPEAKER_00]: shining the day after the accident right look don't you don't have to go

[00:30:10] [SPEAKER_00]: like you don't have to make this flight if it's not safe you don't go

[00:30:14] [SPEAKER_00]: and you know if you feel that pressure of oh you got a sign here and

[00:30:19] [SPEAKER_00]: you got to do the deal and you know this is gonna be here today and gone

[00:30:22] [SPEAKER_00]: tomorrow like that's a really telltale sign of run like just there's

[00:30:28] [SPEAKER_00]: never any pressure to do anything and try not to put that pressure on yourself

[00:30:33] [SPEAKER_00]: even if you feel bad like man I feel like I asked the guy a lot of questions

[00:30:36] [SPEAKER_00]: and we had a few phone calls and you know I don't want to I feel like I've

[00:30:41] [SPEAKER_00]: spent you know time that that's the syndicators job is to answer your

[00:30:44] [SPEAKER_00]: questions and go through all that so don't feel bad about that stuff part

[00:30:48] [SPEAKER_00]: of raising capital exactly hey what other things do you like about him so

[00:30:53] [SPEAKER_01]: I want to go through we kind of talked about this before the show Ryan

[00:30:56] [SPEAKER_01]: was gonna go through the cons I was gonna talk about about the pros so

[00:31:00] [SPEAKER_01]: let's go through the list busy professionals don't have time to manage

[00:31:03] [SPEAKER_01]: their own properties we see this all the time where hey I'll be talking to

[00:31:08] [SPEAKER_01]: someone and they're like dude I've got three kids I'm running around

[00:31:11] [SPEAKER_01]: soccer practice there's no way that I can manage you know fly to it to

[00:31:17] [SPEAKER_01]: some other city to look at duplexes on my days off there's just no way

[00:31:20] [SPEAKER_01]: right so how do you get real estate exposure because real estate is a

[00:31:25] [SPEAKER_01]: fantastic asset class it's tax efficient it gives passive cash flow it you know

[00:31:31] [SPEAKER_01]: it makes money in four different ways which is cash flow amortization

[00:31:34] [SPEAKER_01]: depreciation and appreciation right it's it's amazing but it can be very

[00:31:40] [SPEAKER_01]: difficult to get into it if you don't have the time and the education so

[00:31:45] [SPEAKER_01]: access without your putting in an important amount of your own time and

[00:31:50] [SPEAKER_01]: a very large chunk of your own money because you can get into a

[00:31:54] [SPEAKER_01]: syndication with a $50,000 minimum versus you know there's not a whole lot of

[00:31:59] [SPEAKER_01]: places in the US now where you can buy a rental house with only $50,000 down

[00:32:02] [SPEAKER_01]: right so that's one you want to totally touch on anything before I

[00:32:05] [SPEAKER_00]: move on no I think you nailed it I think you know when you think about

[00:32:09] [SPEAKER_00]: getting into real estate it's got tax benefits big-time tax benefits you

[00:32:13] [SPEAKER_00]: know I think when people say well why would I even bother with this I

[00:32:17] [SPEAKER_00]: can make you know if I'm looking at this real estate syndication it says

[00:32:20] [SPEAKER_00]: pays 16% and the stock you know S&P over the last you know decades been 16% why

[00:32:25] [SPEAKER_00]: would I choose this one over that one if they're if they're looking at

[00:32:28] [SPEAKER_00]: something apples to apples like to compare a return you know the

[00:32:31] [SPEAKER_00]: difference is a you're getting diversification but B that stock

[00:32:34] [SPEAKER_00]: doesn't come with the tax benefits that you're gonna get from real estate

[00:32:37] [SPEAKER_00]: investing and so by being a syndication it kind of couples the

[00:32:41] [SPEAKER_00]: tax benefits with the ability to be completely passive so just something to

[00:32:45] [SPEAKER_00]: think about I mean you know people are like well why would I even do this

[00:32:47] [SPEAKER_00]: in the first place well some of the most marquee you know endowments in the world

[00:32:52] [SPEAKER_00]: you know 20 30 percent of their holdings are in these real estate

[00:32:55] [SPEAKER_00]: syndications and you know some of the wealthiest people I know are investing

[00:32:59] [SPEAKER_00]: in these things so as a diversification strategy and you know

[00:33:02] [SPEAKER_00]: it's a nice way to get into markets and get into things that you can kind

[00:33:05] [SPEAKER_00]: of touch and feel that aren't subject to speculation like we talked

[00:33:09] [SPEAKER_01]: about in our last episode about REITs absolutely yep you know I talk

[00:33:14] [SPEAKER_01]: all the time about how pilots on accident end up very stock market heavy

[00:33:19] [SPEAKER_01]: because we have such generous 401ks so if you aren't out there buying up

[00:33:23] [SPEAKER_01]: rental property you're gonna end up just by the fact that your 401k is gonna

[00:33:27] [SPEAKER_01]: grow massively over your career you're gonna just be really stock market

[00:33:32] [SPEAKER_01]: heavy and it's a good idea to add some real estate to your portfolio

[00:33:35] [SPEAKER_01]: purely for diversification of asset classes right speaking of

[00:33:39] [SPEAKER_01]: diversification one of the wonderful things about syndication is that you

[00:33:43] [SPEAKER_01]: diversify across many different asset classes within commercial real estate

[00:33:47] [SPEAKER_01]: and geographies what I mean by that is you know if I know how to go out and

[00:33:53] [SPEAKER_01]: buy duplexes triclexes maybe I'd move up into some multifamily I'm getting

[00:33:56] [SPEAKER_01]: the hang of this thing I know multifamily but then I say hey I want

[00:34:01] [SPEAKER_01]: to diversify into some self-storage I don't know the first thing about

[00:34:04] [SPEAKER_01]: self-storage I at least to a level that I can feel confident going out

[00:34:08] [SPEAKER_01]: buying a cell storage facility on my own industrial retail the list goes on

[00:34:15] [SPEAKER_01]: and on of different asset classes that you can participate in which have

[00:34:19] [SPEAKER_01]: different characteristics in terms of cash flow appreciation tax benefits

[00:34:23] [SPEAKER_01]: mobile home parks hugely beneficial for or cash flow and for tax benefits

[00:34:28] [SPEAKER_01]: but you haven't developed that that experience level in mobile home parks

[00:34:33] [SPEAKER_01]: you know multifamily it's a way that you can diversify across all these

[00:34:36] [SPEAKER_01]: different things under the sun within real estate and then different

[00:34:39] [SPEAKER_01]: geographies you can have if you live in Seattle Ryan you wanted to invest in

[00:34:43] [SPEAKER_01]: a property in Florida it's gonna be difficult to manage that right and

[00:34:47] [SPEAKER_01]: let's say you have one in Florida one in Texas one in Nebraska one in

[00:34:51] [SPEAKER_01]: Wyoming it starts to get really difficult to handle all of these

[00:34:57] [SPEAKER_01]: properties all over the place and syndication allows for a very easy way

[00:35:02] [SPEAKER_01]: to just diversify over time across all this stuff so yeah I think what makes

[00:35:07] [SPEAKER_00]: diversification across different asset class types so appealing is that you

[00:35:12] [SPEAKER_00]: know you can read in the paper and you can do your own research on kind

[00:35:16] [SPEAKER_00]: of emerging asset classes that you might like like you might think that

[00:35:21] [SPEAKER_00]: retail is good or our office or mobile home parks or self-storage and

[00:35:26] [SPEAKER_00]: it's a way for you to get direct access to that type of real estate

[00:35:31] [SPEAKER_00]: without again without having to become an industry knowledge expert on

[00:35:35] [SPEAKER_00]: something or live in a certain market or find a certain deal so I think it

[00:35:38] [SPEAKER_00]: really helps you know with with that strategy and I think investors can

[00:35:43] [SPEAKER_00]: really benefit from that so I think that's well stated. So the next pro on

[00:35:46] [SPEAKER_01]: my list is the ability to the ability to go beyond your maximum bandwidth

[00:35:51] [SPEAKER_01]: in terms of management so I'll transition from the pilot that says

[00:35:54] [SPEAKER_01]: I have three kids there's no frickin way I can invest in real estate

[00:35:57] [SPEAKER_01]: because I'm too busy. There are other investors who invest in syndications

[00:36:01] [SPEAKER_01]: pilots who invest in syndications who might have two three we have an investor

[00:36:07] [SPEAKER_01]: who has twelve investment property has built an incredible portfolio of rental

[00:36:12] [SPEAKER_01]: properties but you know I'm on the phone and she chose I don't want a

[00:36:16] [SPEAKER_01]: thirteen I'm at my absolute wit's end I'm it's already too much to manage

[00:36:22] [SPEAKER_01]: and I don't want to grow my portfolio even more so eventually if you're

[00:36:28] [SPEAKER_01]: doing your own deals you're gonna reach that point and maybe you can hire a VA

[00:36:32] [SPEAKER_01]: or maybe you can you can really build it but at that point you have a

[00:36:35] [SPEAKER_01]: business yeah you have you have a business and you've employed yourself

[00:36:38] [SPEAKER_01]: within your own business which is totally fine but you're gonna max out

[00:36:43] [SPEAKER_01]: at some point and so it's a great way to scale your real estate

[00:36:46] [SPEAKER_01]: portfolio without scaling real estate headaches so that's that's one that I

[00:36:52] [SPEAKER_01]: really can't state enough and why I love it so much and I call those I call

[00:36:56] [SPEAKER_00]: those accidental landlords or tired landlords right so like accidental

[00:37:01] [SPEAKER_00]: landlords are people who inherit property or you know maybe they did a

[00:37:06] [SPEAKER_00]: different military bases they picked up a rental property you know one at

[00:37:10] [SPEAKER_00]: a time one at a time and they just never sold the houses or you know

[00:37:13] [SPEAKER_00]: they're tired like you're saying you know they have 12 rental

[00:37:16] [SPEAKER_00]: properties and what's really cool about having a bunch of rental

[00:37:20] [SPEAKER_00]: properties that you don't want is I literally just helped a pilot dispose of

[00:37:26] [SPEAKER_00]: some rental property and 1031 exchanged it into a syndication now that's a

[00:37:31] [SPEAKER_00]: whole note so and a lot of opinions very strong opinions on how to do that

[00:37:37] [SPEAKER_00]: correctly but there's there's a there is a way out no give us a call and

[00:37:41] [SPEAKER_00]: and we can talk to you about that you know Tate and I are very

[00:37:44] [SPEAKER_00]: experienced in absolutely helping investors get out of rental property

[00:37:48] [SPEAKER_00]: and get into something more passive so there are also tired landlords at the

[00:37:52] [SPEAKER_01]: 20 million dollar level and we we find those right that brings me to our next

[00:37:56] [SPEAKER_01]: one is the syndicators are finding better deals than you are and what I

[00:38:01] [SPEAKER_01]: mean by that is you know I went to a real estate conference many many

[00:38:05] [SPEAKER_01]: years ago now and my goal was to grow my real estate network and to

[00:38:11] [SPEAKER_01]: continue buying my own properties and instead I found I found the airline

[00:38:16] [SPEAKER_01]: pilots of real estate and I realized that you know if you can't beat them

[00:38:20] [SPEAKER_01]: join them sometimes that statement can be very helpful when you just realize

[00:38:25] [SPEAKER_01]: you know what instead of going out and flying by my 152 on the weekend I'm

[00:38:30] [SPEAKER_01]: just gonna buy a ticket it's let the professionals do it this is what they

[00:38:33] [SPEAKER_01]: do day in day out versus being that weekend warrior that kind of dabbles

[00:38:39] [SPEAKER_01]: in real estate or does it semi-effectively when I say that

[00:38:43] [SPEAKER_01]: they're finding better deals than you this is what I mean I met a syndication

[00:38:47] [SPEAKER_01]: team that had a six person just on the acquisitions team it's a large company

[00:38:54] [SPEAKER_01]: six people were just working in acquisition cold-calling potential

[00:38:58] [SPEAKER_01]: sellers they are taking brokers to lunch they know every lender every

[00:39:03] [SPEAKER_01]: broker in the market and they're schmoozing and and cold-call they're

[00:39:08] [SPEAKER_01]: doing all of these things five days a week and it's like I can't

[00:39:12] [SPEAKER_01]: be with that I'm what if I'm looking at a at a you know Triflex deal or a 16 unit

[00:39:18] [SPEAKER_01]: apartment complex it's already been picked over by professionals and a lot

[00:39:22] [SPEAKER_01]: of times the smaller stuff you know doesn't have the economies of scale

[00:39:25] [SPEAKER_01]: but that's that's kind of a different a different topic but you know I

[00:39:29] [SPEAKER_01]: realized that I'm looking at scraps you know there's a joke that loop

[00:39:34] [SPEAKER_01]: that is where deals go to die loop that if you're not familiar is kind

[00:39:38] [SPEAKER_01]: of like Zillow or Redfin for commercial real estate and it's so

[00:39:41] [SPEAKER_01]: true because the good deals get done off market by relationships you would have

[00:39:45] [SPEAKER_01]: relationship with brokers with potential sellers and those deals get

[00:39:49] [SPEAKER_01]: done before that that property hits the market so if you can't be them join

[00:39:53] [SPEAKER_01]: them it's like you know what these these guys are getting amazing deals

[00:39:57] [SPEAKER_01]: under contract and then they're able to get debt at better terms than I

[00:40:01] [SPEAKER_01]: would be able to personally as well if I if I go to the bank they're

[00:40:04] [SPEAKER_01]: like well okay your experience is X and you're going after this where you

[00:40:08] [SPEAKER_01]: know we can the best we can do is a 7% interest rate they might be

[00:40:11] [SPEAKER_01]: able to get financing at five point five which means they can pay more for the

[00:40:14] [SPEAKER_01]: same property and make more profit out of it once they own it so that's it

[00:40:19] [SPEAKER_00]: that's a huge benefit to me yeah totally and I think getting a

[00:40:24] [SPEAKER_00]: better deal and then also you're probably gonna make more money because

[00:40:30] [SPEAKER_00]: your splits in a syndication are probably going to be favorable to you

[00:40:34] [SPEAKER_01]: the investor and that was my that was the next one on my list which is

[00:40:38] [SPEAKER_01]: investors keep most of the profits yeah investors are at least on a 50-50 from

[00:40:43] [SPEAKER_01]: what you know all the hundreds and hundreds of deals that I've looked at

[00:40:47] [SPEAKER_00]: I think you nailed it and I am you know having a preferred return is a

[00:40:50] [SPEAKER_00]: big deal so you're gonna have some kind of preference which

[00:40:54] [SPEAKER_00]: basically is just a fancy way of saying you're going to get paid first

[00:40:58] [SPEAKER_00]: as the LP or the limited partner but as the investor baby let's say you put

[00:41:03] [SPEAKER_00]: in a hundred thousand dollars you know the typical preferred return could be

[00:41:06] [SPEAKER_00]: anywhere from six to fourteen percent but let's just say it's eight percent

[00:41:10] [SPEAKER_00]: for this example that means that based on your investment amount you're gonna

[00:41:14] [SPEAKER_00]: get you're gonna accrue eight thousand dollars annually in a preferred

[00:41:18] [SPEAKER_00]: return account balance so that gets paid to you first before any splits

[00:41:23] [SPEAKER_00]: with the general partner who's actually running the deal so once that's

[00:41:28] [SPEAKER_00]: satisfied then it might go to like Tate said to a 50-50 or a 70-30 or an

[00:41:33] [SPEAKER_00]: 90-10 whatever it might be but that means that you're gonna get that a

[00:41:37] [SPEAKER_00]: hundred percent preference first before there's any splits with the sponsor as

[00:41:42] [SPEAKER_01]: well so and then it's favorable to you after the fact so hey I'll take

[00:41:47] [SPEAKER_01]: 70% of the deal any day for doing none of the work and you know because

[00:41:52] [SPEAKER_01]: of the incredible experience of a lot of these teams they're really good at

[00:41:57] [SPEAKER_01]: what they do and they rinse and repeat the value creation is is

[00:42:01] [SPEAKER_01]: what they're able to accomplish in a three to five three to seven year period

[00:42:04] [SPEAKER_01]: I will bring up one thing here and that is that I get questions from

[00:42:10] [SPEAKER_01]: investors sometimes it says they'll say why don't you just keep it like

[00:42:14] [SPEAKER_01]: okay we would buy a property that's that's now maybe not distressed but

[00:42:20] [SPEAKER_01]: that is sub-opt and we optimize it through physical improvements through

[00:42:26] [SPEAKER_01]: operational operationally improving it increase the net operating income

[00:42:30] [SPEAKER_01]: cash flow increases why do you sell it well the answer there is usually because

[00:42:35] [SPEAKER_01]: the value has now been created we did the job we got to our destination and

[00:42:39] [SPEAKER_01]: it makes sense to get off the ride now and then get back you know use

[00:42:43] [SPEAKER_01]: that capital to buy something else and participate in that value creation

[00:42:48] [SPEAKER_01]: once again so usually that's why these deals end up we buy we renovate

[00:42:54] [SPEAKER_01]: reach rents we improve the property and then we sell give your money back

[00:42:59] [SPEAKER_01]: plus returns it's up to you if you want to participate in the next three to five years of value creation somewhere else

[00:43:05] [SPEAKER_00]: yeah totally and I think that ties into you know a great question you

[00:43:09] [SPEAKER_00]: should ask your operator and by the way I use the word operator

[00:43:14] [SPEAKER_00]: interchangeably with general partner interchangeably with sponsor so these

[00:43:19] [SPEAKER_00]: are the people that are you're talking to that are that are running

[00:43:22] [SPEAKER_00]: the deal and I always ask like what is the exit strategy for the

[00:43:25] [SPEAKER_00]: investment and you know if I just hear one singular exit strategy I get a

[00:43:30] [SPEAKER_00]: little bit turned off because usually have multiple exit strategies always you

[00:43:34] [SPEAKER_00]: should always have you know hey we can we can sell it we can refinance it

[00:43:38] [SPEAKER_00]: we can reposition it into a different use whatever it might be to exit you

[00:43:43] [SPEAKER_00]: want to have that and you know I always ask the operator you know hey

[00:43:46] [SPEAKER_00]: how many how many years on average does it take you to sell property

[00:43:49] [SPEAKER_00]: have you ever gone longer have you ever gone shorter I asked those

[00:43:53] [SPEAKER_00]: questions just kind of get a sense of the operators ability to kind of make

[00:43:57] [SPEAKER_00]: buy-sell decisions on you know buying and selling the property because what

[00:44:01] [SPEAKER_00]: the worst thing you want them to do is be a seller when the market's down or

[00:44:05] [SPEAKER_00]: be a buyer when the market is up right I mean that's you know that's

[00:44:07] [SPEAKER_00]: kind of on you to analyze that but once the property is purchased you

[00:44:11] [SPEAKER_00]: want to make sure they have good decision-making ability on when you

[00:44:14] [SPEAKER_00]: know a good time to dispose of the asset then again you know trapped equity

[00:44:18] [SPEAKER_00]: is a real thing that you know Tate's talking about where you know hey

[00:44:21] [SPEAKER_00]: we've built up all this equity in the property it's time to let it go it's

[00:44:24] [SPEAKER_00]: time to harvest that equity and do something else with it that we can make

[00:44:27] [SPEAKER_00]: more money on so good points absolutely we're seeing a lot of that today

[00:44:32] [SPEAKER_01]: because interest rates are high and even though we have all this trapped

[00:44:35] [SPEAKER_01]: equity and a lot of deals today you know there's some are distressed

[00:44:39] [SPEAKER_01]: but the deals that are going well it doesn't really make sense to sell them

[00:44:42] [SPEAKER_01]: right now and so we see a lot of deals they're just sort of sitting

[00:44:44] [SPEAKER_01]: there and we're sort of collecting cash flow waiting for you know if the

[00:44:49] [SPEAKER_01]: guys to clear for rates to come down slightly and then it will make more

[00:44:52] [SPEAKER_01]: sense to sell those and harvest the last one I'm going to touch on is the

[00:44:56] [SPEAKER_01]: snowball effect over time so something that you know I built a

[00:45:01] [SPEAKER_01]: syndication returns calculator because I was genuinely curious you know years

[00:45:04] [SPEAKER_01]: ago when I started investing these deals well what does it look like

[00:45:08] [SPEAKER_01]: over time if I just keep doing a $50,000 investment or $100,000

[00:45:13] [SPEAKER_01]: investment every year for the next 10 15 20 25 years and the results

[00:45:18] [SPEAKER_01]: were astonishing because you know the first few years I built this because

[00:45:23] [SPEAKER_01]: the first few years are very boring typically syndication deals only throw

[00:45:27] [SPEAKER_01]: off either nothing or maybe five percent cash flow and that few hundred

[00:45:32] [SPEAKER_01]: dollars that's landing in your account every month or quarter is gonna change

[00:45:36] [SPEAKER_01]: your life so you invest 100k the next year you invest another 100k the

[00:45:40] [SPEAKER_01]: next year you invest another 100k most of these deals are gonna take

[00:45:43] [SPEAKER_01]: five years to mature and you're gonna be four years in like yeah put

[00:45:47] [SPEAKER_01]: almost half the dollars in this and it's really not doing much but then you get your

[00:45:53] [SPEAKER_01]: first exit you get your first deal that goes full cycle you get all your

[00:45:57] [SPEAKER_01]: cash back plus that return on sale and it's like whoa that's nice and then

[00:46:01] [SPEAKER_01]: guess what the next year another one comes next year another one comes and

[00:46:05] [SPEAKER_01]: now you have this flywheel of cash that's coming back to you then

[00:46:10] [SPEAKER_01]: you're redeploying into into new deals providing fresh depreciation

[00:46:14] [SPEAKER_01]: losses the offset the games with it's just it's incredible once you plant the

[00:46:19] [SPEAKER_01]: seeds and it just takes a number of years getting that initial capital

[00:46:24] [SPEAKER_01]: invest in these kinds of deals before you really start seeing some exciting

[00:46:28] [SPEAKER_00]: progress yeah and you know that's a that's a really good point and the

[00:46:32] [SPEAKER_00]: other thing that the thing that I want to conclude on I think is

[00:46:36] [SPEAKER_00]: expectations right so you make the you make the investment in a syndication

[00:46:40] [SPEAKER_00]: so let's say you find the operator you have a good conversation and you

[00:46:43] [SPEAKER_00]: screw it I'm gonna try it 50k go into a deal what can you expect going forward

[00:46:49] [SPEAKER_00]: what is the bond that is created the social bond that's created between you

[00:46:52] [SPEAKER_00]: and the operators like I like to refer it you know yeah you've given up all

[00:46:56] [SPEAKER_00]: your control you've given them their money you know you're kind of along

[00:47:00] [SPEAKER_00]: for the ride it's like there's still expectations that you should minimally

[00:47:04] [SPEAKER_00]: expect and that's number one is communication you should expect to hear

[00:47:08] [SPEAKER_00]: from your operator on some kind of frequency usually quarterly or monthly

[00:47:13] [SPEAKER_00]: you should be able that you should be getting some kind of report and that

[00:47:17] [SPEAKER_00]: report should you know generally have some some things in it such as like

[00:47:20] [SPEAKER_00]: property performance data maybe a brief brief summary doesn't have to be

[00:47:24] [SPEAKER_00]: a long dissertation every single month on the property but you know a brief

[00:47:28] [SPEAKER_00]: summary on what's going on you should be communicated to about the operator

[00:47:33] [SPEAKER_00]: thinking about selling or buying you know or making improvements to the

[00:47:37] [SPEAKER_00]: property you should you know expect to see a picture or two here and

[00:47:41] [SPEAKER_00]: you're not gonna hear about every little bump in the property right you're

[00:47:45] [SPEAKER_00]: not going to hear about oh you know this you know this happened today or

[00:47:49] [SPEAKER_00]: that happened today or or you know things like that you're not going to

[00:47:51] [SPEAKER_00]: hear that those small little details but you should expect to hear big

[00:47:56] [SPEAKER_00]: changes to the property so for example we've had a property wiped out

[00:48:00] [SPEAKER_00]: on tornado you'd probably want to hear about that within 24 to 48 hours

[00:48:04] [SPEAKER_00]: right but you know something like a car bumped into the building yeah

[00:48:09] [SPEAKER_00]: that happens you know probably I you know it really is meaningless financially

[00:48:15] [SPEAKER_00]: maybe there's an insurance claim but you know something like that might not

[00:48:18] [SPEAKER_00]: really be all that important to tell the investor and so the operator might

[00:48:22] [SPEAKER_00]: choose not to talk to you about it and that's okay you know for minor

[00:48:25] [SPEAKER_00]: things but you know as we say you know bad news doesn't get better with

[00:48:29] [SPEAKER_00]: age people we want to hear from our operators when things are going

[00:48:32] [SPEAKER_00]: poorly or when things are going well likewise so you know I would expect

[00:48:37] [SPEAKER_00]: minimally that and then the other thing I would I would expect is some kind of

[00:48:41] [SPEAKER_00]: financial reporting you know a P&L or a balance sheet at some frequency that

[00:48:46] [SPEAKER_00]: goes out that lets you know kind of the financials of the project Tatey do

[00:48:49] [SPEAKER_01]: you think what you want to add to that no I think that's spot-on I think

[00:48:52] [SPEAKER_01]: I think that you know whenever someone has a bad experience in a

[00:48:56] [SPEAKER_01]: passive deal it usually revolves around poor communication there are very

[00:49:01] [SPEAKER_01]: few times where a deal can go sideways and if the operator is being

[00:49:06] [SPEAKER_01]: upfront honest working their absolute butt off to make the deal work and

[00:49:11] [SPEAKER_01]: communicating very clearly about what is happening and the efforts that

[00:49:16] [SPEAKER_01]: are going into it that investors are gonna leave with a sour taste in their

[00:49:19] [SPEAKER_01]: mouth it's the deals that start to go sideways and the operator just

[00:49:23] [SPEAKER_01]: disappears they just go silent and whether they're working behind the

[00:49:26] [SPEAKER_01]: scenes or not the investors have no clue what's happening with their capital

[00:49:29] [SPEAKER_01]: that's where you know people just just come away from that experience

[00:49:33] [SPEAKER_01]: really disheartened and it makes them not want to invest again so I think I think

[00:49:38] [SPEAKER_01]: choosing an operator based on you know their frequency and quality of their

[00:49:42] [SPEAKER_00]: communications is very very important. I agree and if you don't like the

[00:49:46] [SPEAKER_00]: quality of the communications I would expect to minimally to have a phone

[00:49:49] [SPEAKER_00]: number for someone you could to call or someone to email and you know and

[00:49:52] [SPEAKER_00]: just remember before you get too combative with your with your

[00:49:55] [SPEAKER_00]: syndicator just remember you know try to have the try that try to have

[00:49:59] [SPEAKER_00]: mindset that hey we're on the same team here right like we're all trying

[00:50:04] [SPEAKER_00]: to get to our destination you know this is the go-home like like nobody's

[00:50:07] [SPEAKER_00]: on the same aircraft you're on the same plane right there's no reason to get

[00:50:10] [SPEAKER_00]: combative that's not gonna help anybody you know something's going

[00:50:13] [SPEAKER_00]: wrong or you don't quite understand you know seek to understand before

[00:50:17] [SPEAKER_00]: you just you know lay into somebody because they it might be that they're

[00:50:21] [SPEAKER_00]: working through something and giving you too much information sometimes is

[00:50:24] [SPEAKER_00]: gonna make it more complicated is right it's like giving that PA to a

[00:50:28] [SPEAKER_00]: passenger is it's like you want it you want to be honest and transparent but

[00:50:32] [SPEAKER_00]: sometimes you don't need to be so darn detailed that now you freaked

[00:50:36] [SPEAKER_00]: everybody out you know in the back when you didn't really need to you know

[00:50:40] [SPEAKER_00]: you know everything is gonna be okay so just kind of you know I would have

[00:50:45] [SPEAKER_00]: that expectation to do that so they know that you're entitled to inspect

[00:50:49] [SPEAKER_00]: the operators books right you're you're entitled to you know see the

[00:50:54] [SPEAKER_00]: the financial performance of the investment at any time you know I mean I

[00:50:59] [SPEAKER_00]: wouldn't ask them every day but you know it's some frequency if you wanted

[00:51:02] [SPEAKER_00]: to see the balance sheet and the P&L like you should feel entitled then the

[00:51:06] [SPEAKER_00]: operator should be organized enough to provide you with that

[00:51:08] [SPEAKER_00]: information and then they will that's you know that should be your right

[00:51:12] [SPEAKER_01]: in my opinion absolutely just added that I think that you know we get a

[00:51:16] [SPEAKER_01]: lot of questions as well about you know hey you ever heard of crowd

[00:51:20] [SPEAKER_01]: street or cadre or realty mogul there's a lot of these crowdfunding websites and

[00:51:26] [SPEAKER_01]: that this was a function of the 2012 Obama jobs act that legalized

[00:51:32] [SPEAKER_01]: crowdfunding and it made a big splash back in 2012 everybody thought you

[00:51:37] [SPEAKER_01]: know these new crowdfunding platforms were really gonna take over and

[00:51:40] [SPEAKER_01]: everybody was gonna be investing in real estate via via these big

[00:51:44] [SPEAKER_01]: platforms and and it never really took off and this is exactly why is

[00:51:48] [SPEAKER_01]: because when you're cutting a 50 or 100 thousand dollar check it really becomes

[00:51:52] [SPEAKER_01]: a relationship business just as that snowball financially grows over time the

[00:51:57] [SPEAKER_01]: relationship business grows over time you have a good experience with it

[00:52:00] [SPEAKER_01]: with a great team people tend to to reinvest and while there you know

[00:52:04] [SPEAKER_01]: there are hundreds thousand of operators throughout the country and

[00:52:08] [SPEAKER_01]: various different asset classes with varying degrees of success track record

[00:52:12] [SPEAKER_01]: skills I think that there's a lot of good ones but people tend to reinvest

[00:52:19] [SPEAKER_01]: with the ones who they build that relationship with and there's the trust

[00:52:22] [SPEAKER_01]: no like and trust factor or it's like hey you know I've flown this airline a

[00:52:26] [SPEAKER_01]: bunch I like the service I like I feel comfortable with them I know the drill

[00:52:30] [SPEAKER_01]: and there's nothing wrong with that you know you don't have to go

[00:52:32] [SPEAKER_01]: chasing you know greener pastures at that point so anyway that's your sense

[00:52:36] [SPEAKER_00]: finding these things and looking at lots of them will help to fine-tune so

[00:52:40] [SPEAKER_00]: those websites can be great for just kind of poking around and kind of seeing

[00:52:44] [SPEAKER_00]: what's out there but start to open up your lens and go to some conferences read

[00:52:48] [SPEAKER_00]: some books you know listen to podcasts and see what indications are out there

[00:52:51] [SPEAKER_00]: to kind of really build your deal funnel well Tate this has been a

[00:52:55] [SPEAKER_00]: great show I think I feel like we really provided some some overview of

[00:52:59] [SPEAKER_00]: you know how to find that pros cons ups towns what is it I hope everybody

[00:53:04] [SPEAKER_00]: kind of took away from this if you did enjoy what you listen to you know

[00:53:07] [SPEAKER_00]: throw us a comment in the Facebook forum I think that's a great place to

[00:53:11] [SPEAKER_00]: collaborate on this kind of stuff and we've been having a blast with everybody

[00:53:15] [SPEAKER_01]: on the Facebook forum recently thank you for everybody that's been posting

[00:53:19] [SPEAKER_01]: on there thank you thank you if you're not a member yet join up

[00:53:21] [SPEAKER_01]: there's been some really nice activity yeah and if you have a

[00:53:24] [SPEAKER_00]: syndication I mean we obviously can't act as your like investment advisor or

[00:53:27] [SPEAKER_00]: something but we're always happy to give two cents on you know hey I'm

[00:53:30] [SPEAKER_00]: looking at this like don't just say hey I'm looking at this what do you

[00:53:33] [SPEAKER_00]: think say hey I'm looking at this take it a step further I'm looking at

[00:53:37] [SPEAKER_00]: this is what I see and this is what I think it is is that right or what do you

[00:53:41] [SPEAKER_00]: guys agree or this is my expectation of what I might get in this you know is

[00:53:45] [SPEAKER_00]: that right is that what you guys are seeing the help kind of lead us to

[00:53:48] [SPEAKER_00]: what you're thinking and and that'll help us give you some better feedback

[00:53:52] [SPEAKER_00]: on where you're trying to go with something so anyway Tate it's always a

[00:53:56] [SPEAKER_01]: pleasure always a pleasure the end of the day syndication is my

[00:53:59] [SPEAKER_01]: favorite way to invest but we'll leave it here thanks so much my

[00:54:02] [SPEAKER_00]: friend talk to you next time