Pooling Capital for Larger Deals
Real estate syndication pools capital from multiple investors to acquire properties too large for any single investor. A general partner (GP) or sponsor identifies the deal, secures financing, manages the property, and makes operational decisions. Limited partners (LPs) provide the majority of equity capital and receive passive income and appreciation but have no management responsibility. Syndications are typically structured as LLCs and offered as private placements under SEC Regulation D — either 506(b) (up to 35 non-accredited investors, no advertising) or 506(c) (unlimited accredited investors, advertising allowed). Minimum investments typically range from $25,000 to $100,000. Understanding the alignment of interests between GP and LP is critical to evaluating any syndication.