Real Estate Syndication: A Viable Option for Passive Investors?

by | Mar 9, 2023 | Investing Advice | 0 comments

Real estate syndication combines resources to acquire and manage real estate property assets. Two limited liability companies are typically formed – one for holding the management team and the other for the property asset. Active investors manage the property, while passive investors provide equity.

 

How Real Estate Syndication Works

Investors receive quarterly dividends from rental income. Passive investors receive income without active involvement, while active investors make management decisions. A well-written PPM provides details on the structure, operation, and profit distribution.

 

Passive vs Active Investing

Passive investors generate income, while active investors make decisions. Many start as passive investors and gradually become more involved. A PPM provides details on the investment structure and profit distribution.

 

Why Choose Passive Income Investments?

Passive income investments preserve and grow wealth. Passive investing is often chosen by institutional endowments, and tax advantages make it an attractive option.

 

Conclusion

Real estate syndication is a viable option for passive investors seeking income and wealth growth. It offers flexibility and a well-written PPM provides details on all aspects of the investment. With tax advantages, real estate syndication is an excellent choice for building long-term wealth.

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