How It Works

Step-by-Step Guide to Real Estate Syndications for First-Time LP Investors

At One Seed Capital, we specialize in real estate syndications, helping investors build long-term wealth through passive real estate investments. Whether you’re new to syndications or looking to refine your understanding, this guide will walk you through the key aspects of becoming a Limited Partner (LP) in a real estate syndication.

Real Estate Syndications Made Simple

Real estate syndication lets multiple investors pool funds to acquire large-scale properties—typically through a Limited Partnership (LP) or LLC structure.

Key Roles:

General Partners (GPs): Source, manage, and operate the deal.
Limited Partners (LPs): Invest capital, earn passive income, and enjoy limited liability.

Evaluating Investment Opportunities

Sponsor Track Record:
Look for experience, transparency, and skin in the game.
Property & Market Analysis:
Consider location, strategy (value-add, stabilized), and market fundamentals.
Financials & Risk:
Review projected returns, debt terms, cash flow, and exit options.
Legal Review:
Understand fees, rights, and terms in the PPM, LPA, and Subscription Agreement.

Earning Returns

Distributions: Quarterly/monthly income from rents.
Performance Reports: Regular updates and financials.
Tax Benefits: Depreciation, cost segregation, and long-term capital gains.

Profit Distribution Structure

Preferred Return: LPs earn returns (e.g., 7–8%) before GPs share profits.
Waterfall Structure: Profits split in tiers—e.g., 80/20, then 70/30, based on IRR