- I recently received a very great question from a subscriber who would like to learn more about apartment syndication and the role of a syndicator. She asked what does the day look like for an active syndicator. I figured that this would make a great blog topic since others may have the same question. Every apartment syndicator is different. Since multifamily investing is a team sport, the day depends on the role each active partner plays in a syndication.
Multiple Roles and Activities
- Syndicators can wear various hats, including, but not limited to the following general categories of role and activities within most firms.
- Underwriting: This role involves constantly reviewing new investment offerings and looking at the numbers to see at what price the deal could make sense. Underwriters often interface with the broker, asking questions and seeking more information to solidify their understanding of the asset and at what price makes sense for an offer. Underwriters also share information and brainstorm with their partners, soliciting feedback and thoughts on multiple investment opportunities. Good underwriters spend most of their time reviewing deals, and must review as many as a hundred to find just a few that may make sense.
- Investor Relations: Partners in this role spend much of their time identifying potential investors and prospective clients as well as informing existing investors the status of the investment and how things are going. Investor relations ensures availability to answer questions about current investments and may spend much of their time on the phone speaking with clients. When investment opportunities are identified, they help disseminate the marketing materials, coordinate the webinar to discuss the offering, and once again, maintain availability to answer questions. Investor relations is a critical role in syndications because without capital and satisfied investors, acquisitions will not happen.
- Asset Management: Is a key role that involves managing the property managers that directly manage the apartments under ownership. Asset managers spend much of their time checking in on the status of the renovations, occupancy, any other improvements. The criticality of this role involves regular site visits, both announced and unannounced, to verify the execution being communicated by property managers. Good asset managers review key metrics such as occupancy, loss-to lease and bad debt and constantly hold property managers accountable to continuous improvement. Asset management is such a critical role because the business plan itself is based upon effective management of the property.
- To conclude, for the majority of roles, the above outlines how day/time is spent performing each role. As you can see, these are very specialized efforts. Remember, depending on the maturity of the firm or team, these roles may be totally divided or there could be overlap.
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