My First Apartment Syndication: A Milestone Achievement

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Diving into the world of larger multifamily properties was a significant leap for me. After years of focusing on smaller multifamily investments, I knew it was time to scale up. My aim wasn't just personal growth but also to help others grow financially. I wanted to give friends and family a chance to benefit from real estate, leveraging the experience I had built over the years. Little did I know that my first syndication would not only achieve those goals but exceed them in ways I hadn’t imagined.

From Small Beginnings to Big Dreams

My real estate journey started small—scraping together funds to purchase a "Frankenstein" 4plex and learning everything I could along the way. I did everything myself, from managing tenants to fixing leaky faucets. Each deal was a learning experience, and as I grew more comfortable, I started dreaming bigger.

Moving into larger multifamily properties had always been part of my long-term plan. While my smaller deals were successful, I knew that scaling up would unlock new opportunities for both me and those I brought along for the ride. The next step was syndication—pooling resources from multiple investors to take down bigger deals. It wasn’t just about growing my portfolio; it was about sharing the wealth and knowledge I had gained. Syndication would allow others to benefit from the real estate game without needing to get their hands dirty, while I could focus on finding and managing deals.

Making the Leap

One of the biggest challenges in transitioning to syndication was finding the right property. I knew the Denver metro area well, so I decided to focus on that market. I began reaching out to commercial brokers in Denver and its surrounding areas, offering them an incentive to bring me off-market deals. I was willing to hustle, even if it meant being aggressive with follow-ups and staying on their radar. Persistence paid off, and soon I was presented with a gem—an off-market 6-plex in Westminster, a suburb of Denver.

The seller was an old-school DIY landlord who hadn’t modernized anything, including his property management methods—he didn’t even own a smartphone! His units were vastly under-rented, especially for the area. These were 2-bedroom, 2-bathroom townhomes, yet the rents were far below market. The property needed some work, but that was where I saw the potential. I recognized an opportunity to significantly increase the value by bringing rents up to market rates and addressing some deferred maintenance.

Structuring the Deal

Negotiating the purchase of the 6-plex was a challenge, but a rewarding one. I worked out a fair purchase price, securing a $25,000 seller credit at closing. The next step was raising the funds. This was a daunting task for me because, as an introvert, asking people to trust me with their money was intimidating. However, I was committed to the opportunity and to helping others benefit from it as well.

I reached out to a few close friends and family members, explaining the potential of the deal and how they could see great returns by investing with me. Their support was tremendous, and together we raised the necessary funds. To contribute further, I sold my 4-plex, which had been my first major investment years ago. It was a bittersweet moment letting go of the property that had helped me get started, but I knew this 6-plex was the next big step.

Adding Value and Taking Action

Once we closed on the 6-plex, the work began. Our goal was to increase rents to market rates while improving the property itself. I knew from my experience with smaller properties that this would involve some sweat equity, and I wasn’t afraid to roll up my sleeves. Over the course of a year, we increased rents across the board. Three tenants accepted slightly lower than market rents as increases without requiring any renovations, which was a win for both them and us. For the remaining units, we did the work ourselves and hired contractors, with the help of friends, family, and property management connections, to give the property a much-needed facelift.

We renovated three of the units, addressing deferred maintenance along the way. These renovations weren't just about aesthetics; they added real value to the property. From upgrading kitchens and bathrooms to fixing long-neglected issues, we knew every improvement would have a long-term impact on the property’s appeal and profitability.

The result? The property was transformed, and so was its income potential. Within a year, rents were at market rates, and the property was running smoothly. It was rewarding to see the hard work pay off, but the real surprise came when I decided to test the market.

Exiting Early with Big Returns

Less than two years after purchasing the 6-plex, I received an unsolicited offer to buy the property. At first, I wasn’t planning on selling so soon—my original plan was to hold onto the property for longer to generate cash flow and continue to build equity. However, the offer was too good to pass up. It was a true testament to the value we had created through our renovations and rent increases.

I consulted with my investors, and together we decided to sell. The outcome was nothing short of incredible. Our investors earned an equity multiple of 1.75 and IRR of 33% in under two years—a huge success by any measure. The project exceeded even my most optimistic expectations. It proved that the time and effort I had invested in learning the ins and outs of real estate, coupled with the sweat equity and financial discipline, had paid off. More importantly, it showed that syndications could be a powerful tool for both me and my investors.

Lessons Learned

While not every property will yield such extraordinary results, this experience taught me several key lessons that will shape my future syndications. First, relationships matter—building strong connections with brokers, contractors, property managers, and investors is key to finding and closing good deals. Second, being willing to do the work yourself (or with the help of friends and family) can save you money and help you gain valuable experience. I now have a much better idea of what things cost for a typical cosmetic renovation and the work involved. Finally, timing is everything. We could’ve held onto the property for longer, but by staying flexible and open to opportunities and listening to the market, we were able to capitalize on a great offer during the height of the market in 2022.

What’s Next

This first syndication wasn’t just a financial success—it was a milestone that validated my strategy and reinforced my belief in the power of real estate investing. It gave my investors confidence in me, and it strengthened my resolve to keep going. Syndication has allowed me to scale up my real estate portfolio while helping others achieve their financial goals. This project was just the beginning, and I’m more excited than ever to continue seeking out opportunities that provide strong returns for everyone involved.

If there's one takeaway from this journey, it’s this: Get in the game, take action, and don’t be afraid to go bigger than you initially thought possible. Every property comes with its own challenges, but the key is to learn, adapt, and keep moving forward. I’m excited to continue this journey and explore what lies ahead—both for myself and for those who invest with me.

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