Forum Replies Created
Hi,
I’m in a small property syndicate with 4 friends and have helped a number of groups set up their own property syndicates.
Like Scratch says, investing in a syndicate will help you get in quicker, but you need to be careful to make sure that the members of your syndicate share the same goals so you manage your social risk. There are definitely techniques you can employ to do this.
I wrote an article on property syndicates for Your Investment Property magazine a while ago, it covers some topics you might be interested in like, the 7 steps to setting up syndicate, the 3 key things to watch out for, the 5 tips for syndicate success and the 5 benefits of having a syndicate.
You can get a copy at http://propertycollectives.com.au/2010/12/your-step-by-step-guide-to-starting-a-property-syndicate/
Hope it helps!
Hi,
I wouldn’t go past Michelle Coleman. Michelle runs her own practice called Buzz Finance. She is based in Melbourne and you can contact her on [email protected] or 0423 974 543.
I’ve been using Michelle since 2006. She is an active investor, she knows her stuff and goes the extra mile. She’s never not been able to deliver for me.
Hi Jo,
Some great advise for you. CSRA and Kent are spot on with the points they make about what to look out for and what you need to think through.
You particularly need to be careful around how you structure your joint venture from a finance perspective. Like CSRA says, be very careful with your structure because you don’t want to not be able to split the mortgage. You definitely don’t want to be jointly and severally liable for the full amount of debt you take on as it will impact your ability to make future purchases either within or outside of your syndicate.
Investing with friends is not for everyone but it can work. I’ve been involved with 3 syndicates. Two have been for property developments and one is for long term buy/renovate/hold purchases. Although there have been some trying moments, for me they have never proved insurmountable.
Like CSRA says, a comprehensive legal agreement is a critical component as it goes a long way towards managing everyone’s expectations around all the “what if’s”.
I’ve written a step by step guide to setting up a property syndicate which might help you make up your mind as to what your next step should be. You can request it off my website. Best of luck. I think if you have a strong relationship with your partner(s) and take the time to negotiate a solid agreement you will have put yourself in a great position to make your venture a success.
Hi Greg,
Thanks for taking the time to respond. That certainly is a departure from Bill’s past seminars…
Hi Olivia,
I’m happy to fill out your survey. I’ve done a couple of developments.
Hi Mark,
Apart from putting it out to your personal network and beyond (Facebook?) I think websites, forums and maybe ads in property specific media (i.e. YIP mag or API or domain etc) might be your best bet. However I suspect that print advertising would be a very expensive and possibly fruitless exercise.
Personal networks and recommendations are always the best option I feel. You need a fair degree of trust to make a joint venture work and trust is hard to manufacture amongst strangers.
The other option you might want to consider is project marketers. Some of these companies have networks of clients from accountants and financial planners that you might be able to “shop” a potential project to…
Hi All, This is clearly a very old thread. But for what its worth I thought I would add my comments. I've set up my own syndicate and helped a number of people set up similar syndicates over the last few years. The structure I've used is a Syndicate Participation Agreement which as far as I'm concerned is a much better structure for multiple parties to invest in one or more properties than any sort of trust. <moderator: delete advertising>
Hi Geoff, I agree with Paul & Karen when they say "start small, be very reputable and people will notice what you're doing." I've been involved in three different joint ventures. Two of them I'm still involved in, a 4 townhouse development and a long term buy/hold/renovate/sell syndicate with 3 properties in it. All the projects have worked out to date. Although the first project which was an 8 townhouse development took a lot longer and was pretty challenging. The two projects I'm still involved in have been with friends and family members. These projects have run a lot smoother to date. In terms of structuring both these types of syndicates have been formalised using a JV agreement (for the developments) and a Syndicate Participation Agreement (for the syndicate). <moderator: delete advertising>
Hi Harj,
Sounds like you’ve got a good project on the go. Nice work.
I believe obtaining finance for hybrid trusts at the moment is quite difficult. You may not need a hybrid trust though.
I’ve done a few developments and have used a joint venture agreement whereby the purchasing entity is a company that you and your partner would control. Happy to have a chat if you’d like to find out more.
I also have a great accountant that could help you out. We are both based in Melbourne though…
Hi,
I agree with Linar. If it is a factory your should definitely check out whether there are any contamination issues with the site.
With respect to your questions about whether there is any difference between a joint venture or a syndicate. Personally I don’t think there is. The terms are interchangeable.
The only difference I can think of is that syndicates are typically used to invest in commercial property investments i.e. larger managed investment schemes with many investors putting in capital to purchase units in the scheme.
Joint ventures are a form of syndicate but I think the term is usually used to refer to smaller syndicates. Does that make sense?
