Multifamily syndication is a way for multiple investors to pool their money together to purchase large apartment buildings or multifamily properties that would otherwise be too expensive for a single investor. The General Partners (GPs), such as our team at Freeman Lundt, handle every aspect of the acquisition, renovation, and management of the property, while Limited Partners (LPs) contribute capital in exchange for passive income without managing day-to-day operations.
This model provides investors with access to stable cash flow, property appreciation, and potential tax benefits, including cost segregation. Cost segregation accelerates depreciation, allowing investors to offset income and lower their tax burden.
Cash Flow
Investors receive quarterly distributions after all operational expenses are covered.
Stability
Multifamily properties offer consistent performance, with less volatility than traditional stock investments.
Tax Benefits
Depreciation provides significant tax advantages, helping you retain more of your earnings.
Leverage
Real estate allows you to control a $10M property with a $2.5M investment through leverage.
Amortization
Tenant payments reduce debt, build equity, and create lasting financial growth.
Appreciation
Strategic improvements drive property value, resulting in enhanced asset appreciation.
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Our Investment Strategy
At Freeman Lundt, our investment strategy is multi-faceted. We think outside the box to deliver superior returns for our investors. At our firm, this starts with a bottom-line approach. We focus on acquiring underperforming or value-added multifamily properties with significant growth potential, transforming them into high-performing assets that maximize both short-term cash flow and long-term appreciation.
Sustainability Meets Profitability
Leveraging our network of energy efficient companies like LED Trail (one of our sister companies), we incorporate energy-efficient solutions into our value-add projects. From LED lighting retrofits, solar panels, water expense reduction, and more advanced energy-saving technologies, we reduce utility costs for properties while contributing to a greener future. These sustainable enhancements not only lower expenses but also boost property appeal and value, ensuring long-term tenant satisfaction and operational stability.
Key Value-Add Initiatives
- Operational Efficiencies: Streamlining property management processes to reduce costs and optimize performance.
- Renovation Projects: Modernizing interiors, upgrading amenities, and enhancing curb appeal to increase property value and rental demand.
- Energy Optimization: Partnering with energy efficiency manufacturers to implement cutting-edge solutions like solar integration, EV charging stations, and energy-efficient systems that reduce costs and meet modern tenant expectations.
- Community Enhancements: Creating safe, desirable spaces with improved facilities and services that foster a sense of community, helping to reduce tenant turnover.
Key Buy Box Criteria
Our focus is on properties that align with the following parameters to ensure the best opportunities for growth and return on investment:
Investment Offerings
Freeman Lundt offers both 506(b) and 506(c) SEC-compliant syndication opportunities:
Minimum investments range from $25K to $100K, with tiered preferred returns based on contribution levels.
The Bottom Line
Every enhancement we make directly impacts the bottom line. Energy savings, increased occupancy rates, and optimized operations ensure higher cash flow and asset appreciation, putting more money in our investors’ pockets. Our strategic improvements are carefully designed to maximize both short-term performance and long-term value, creating a legacy of wealth for our investors and their families.
Seamless Investment Process
At Freeman Lundt, we take the complexity out of multifamily syndication by managing every step of the process for you. From sourcing high-quality properties and conducting in-depth market analysis to overseeing renovations and property management, we ensure your investment is handled with precision and care.
Our experience in underwriting, risk mitigation, and value-add strategies allows us to create investment opportunities that maximize returns while minimizing risk, all while you enjoy the benefits of passive income.
Transparent and Proactive Management
We believe in building trust through transparency. Throughout the investment lifecycle, we provide regular updates on property performance, financials, and returns, keeping you informed every step of the way. Our proactive approach to property management ensures that we identify and address any challenges early, optimizing each asset’s value while safeguarding your capital. At Freeman Lundt, our goal is to enhance your investment portfolio without adding any burden to your daily life.
Long-Term Wealth and Growth
With a focus on long-term wealth generation, our syndication model allows you to benefit from both steady cash flow and property appreciation. By leveraging decades of industry experience and staying ahead of market trends, we position each property for sustainable growth. Whether you’re looking to diversify your portfolio or take advantage of real estate’s tax benefits, investing with Freeman Lundt means partnering with a team that’s dedicated to creating value and building financial security for the future.
A Win-Win for Investors and Residents
Our value-add approach balances profitability with purpose. By improving operational efficiencies and modernizing properties, we create thriving communities that tenants are proud to call home—all while driving higher returns for our investors.
Multifamily Syndication with Freeman Lundt
We manage all aspects of the investment, allowing you to enjoy consistent returns without the hassle of property management.
Tangible Asset Backing
Your investment is tied to real estate, a physical asset that provides stability compared to more volatile markets. Multifamily properties are in high demand due to the constant need for housing, which helps protect your investment, even in uncertain economic conditions.
Expert Management
As your General Partners, we handle all the heavy lifting. From acquiring the property to managing renovations and tenants, we ensure the project runs smoothly, so you can focus on reaping the benefits of passive income without day-to-day involvement.
Proactive Risk Mitigation
We conduct thorough due diligence and run stress tests on each deal to prepare for market fluctuations. Additionally, with multiple exit strategies and contingency plans in place, your investment is safeguarded even if the market shifts or the property underperforms.
Know Your Investment Goals
Define your short- and long-term financial goals before investing. Whether you’re looking for cash flow, appreciation, or tax benefits, understanding your goals helps you choose the right investment opportunity.
“Investing in real estate isn’t just for the wealthy—it’s for those who want to create wealth.”
The 4 Steps of Investing with Multifamily Syndication
- Be the First to Know: As part of our investor network, you’ll receive exclusive, early access to multifamily property investment opportunities with strong potential for growth.
- Informed, Confident Decisions: Our team shares in-depth property insights, market analyses, and projections. You’ll also have access to educational sessions to help you understand the strategy and the projected returns.
- Easy Commitment: Once you’re interested, a simple soft commitment lets us know you’re on board—no binding obligations yet, just a nod to move forward.
- Clear and Transparent Investment Process: You’ll receive a Private Placement Memorandum (PPM) and an expansive slide deck that clearly outlines the investment structure, returns, and all important details. We handle the complexity so you can focus on what matters.
- Tailored Structure for Maximum Returns: With a solid capital structure—including preferred returns and equity splits—you can invest with confidence that your commitment aligns with your financial goals.
- Proactive Property Management & Value Creation: Our experienced team takes charge, enhancing property value through improvements and management that maximizes income potential.
- Stay Informed, Reap Rewards: You’ll receive regular, detailed updates on your investment’s performance and enjoy quarterly distributions that align with our business plan, keeping you informed every step of the way.
- Optimized for Maximum Returns: Our team continuously monitors market conditions and property performance to identify the optimal time for sale or refinance, giving you the best possible return.
- Enjoy Final Distributions: Upon exit, you’ll receive a comprehensive payout, including your share of the property’s appreciation and remaining preferred returns, closing the loop on a rewarding investment journey.
Maximize Tax Benefits with Cost Segregation
Multifamily syndication offers powerful tax benefits through cost segregation studies and accelerated depreciation, enabling investors to write off significant portions of a property’s value in the early years of ownership. By identifying and depreciating components like appliances, fixtures, and landscaping over shorter time frames, these strategies help reduce taxable income and create substantial tax savings. This makes it an effective tool for offsetting income and retaining more earnings from real estate investments. As tax situations vary, always consult with your tax advisor to understand how these benefits apply to your specific circumstances.
Understand the Risk-Return Tradeoff
Every investment comes with risks, and multifamily syndications are no exception. Make sure you’re comfortable with the level of risk in a deal and understand how it aligns with the potential returns.
And remember, you don’t want to put all your capital into one deal or asset class. Diversifying across different markets, property types, or syndicators can help reduce risk and improve your overall portfolio performance.
We’re Here to Help You Build Wealth
Have questions about if Multifamily Syndication is a good fit for your investment strategy? Call, email us, or fill out our contact form, and we’ll get in touch.
Frequently Asked Questions about Multifamily Syndication
Multifamily syndication is a powerful tool for building wealth and leveraging tax advantages, but it involves many moving parts that can be complex and challenging to navigate. To help demystify the process, here are answers to some of the most frequently asked questions, along with key terminology you should know.
- 506(b) Offerings:
- Allows up to 35 non-accredited investors who are “sophisticated” and an unlimited number of accredited investors.
- No public advertising is permitted for these deals. Sponsors must have a pre-existing relationship with all non-accredited investors before the offering.
- Ideal for those new to syndication or who want to include sophisticated investors.
- 506(c) Offerings:
- Open only to accredited investors (defined below).
- Allows for public advertising to attract potential investors.
According to the SEC, you qualify as an accredited investor if you meet one or more of the following criteria:
- Net Worth: Your net worth (excluding your primary residence) exceeds $1 million, either individually or jointly with a spouse or spousal equivalent.
- Income: You have earned an annual income of $200,000 (or $300,000 jointly with a spouse) in the past two years and expect to maintain that level.
- Professional Status: You hold certain financial certifications or designations (e.g., Series 7, 65, or 82 licenses).
- Entity Ownership: You are a general partner, executive officer, or director of the company issuing the securities.
A sophisticated investor is someone with enough knowledge and experience in financial and business matters to evaluate the risks and merits of an investment. Unlike accredited investors, there are no specific financial thresholds, but you should have:
- A solid understanding of syndication risks and returns.
- Prior investment experience or strong financial literacy.
- The ability to absorb the potential loss of the investment.
- Sponsors must assess whether a non-accredited investor qualifies as sophisticated before allowing them to participate in a 506(b) offering.
Multifamily syndication allows you to scale quickly and leverage economies of scale. Rather than managing one rental property at a time, you’re investing in larger apartment communities with professional property management in place. It also diversifies your risk—if one tenant leaves, the vacancy impact is spread across multiple units, unlike a single-family rental, where losing one tenant means 100% vacancy.
Yes! Freeman Lundt will provide:
- Quarterly Reports: Financial and operational updates.
- Annual Tax Documentation: K-1 forms for your tax filings.
- Regular Communications: Progress on renovations, occupancy rates, and distributions.
The PPM is a legal document outlining the details of the investment, including:
- Projected returns and risks.
- Fee structures and investor responsibilities.
- Compliance with SEC regulations. This ensures you have all the information needed to make an informed decision.
Absolutely! Investors are allowed to visit the property before investing and during the life of the project. If you give us advanced notice, we can make sure someone is there to show you around and answer any questions.
Investor funds are used for the total acquisition cost of the property. This includes but is not limited to the down payment for the actual purchase of the property, acquisition fees, legal and transaction costs, capital improvements, and reserves.
Yes! Many of our investors use self-directed IRAs or solo 401(k)s to invest in syndications. If you currently have a self-directed IRA, please check with your current custodian to ensure that they will allow you to place your investment with Freeman Lundt Multifamily Syndication. If you haven’t converted from a traditional IRA to a self-directed IRA, you’ll need to contact a custodian to help you with that. If you need a referral, we can connect you with the group we use personally.
Freeman Lundt typically charges:
- Acquisition Fee: A percentage of the property’s purchase price to cover sourcing and due diligence.
- Asset Management Fee: Ongoing fee for overseeing property performance.
- Disposition Fee: A fee upon the sale of the property, tied to the final sale price. All fees are outlined transparently in the PPM.
Insider Tip: Ask Questions Before Investing
Don’t be afraid to ask the syndicator about their business plan, fee structure, and risk mitigation strategies. A transparent syndicator will welcome your questions and provide detailed answers.
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Understanding Investment Risks in Multifamily Syndication
Investing in multifamily syndication involves risks, and prospective investors should carefully consider these risks before participating. As with any investment, there is no guarantee of returns, and investors may lose part or all of their investment. Factors that could impact the performance of a multifamily syndication include:
- Market Fluctuations: Changes in local or national real estate markets, including economic downturns, shifts in tenant demand, or changes in interest rates.
- Property-Specific Risks: Unexpected expenses related to property management, repairs, or vacancies that could reduce cash flow and profitability.
- Illiquidity: Multifamily syndications are typically long-term investments and may not offer liquidity before the property is sold or refinanced.
- Regulatory Changes: Changes in laws, tax regulations, or zoning policies could affect the property’s financial performance or valuation.
- Operator Risks: The success of the investment depends on the performance of the sponsor or syndicator, including their ability to manage the property, execute the business plan, and navigate unforeseen challenges
This is not an offer to sell or a solicitation to buy securities. Any offering of securities will be made only by means of a private placement memorandum (PPM) and is subject to the terms and conditions contained therein. Prospective investors should conduct their own due diligence and consult with financial, tax, and legal advisors to fully understand the risks and suitability of such investments in the context of their personal financial circumstances.”
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