How To Make Your First Real Estate Syndication Investment

Real estate investing involves choosing a market, neighborhoods, and desired bedrooms and bathrooms. However, investing in real estate syndication (group investment) can be unfamiliar, especially for those new to this process. This article aims to explore the syndication process from start to finish, allowing investors to confidently invest in their first real estate syndication. This comprehensive guide will help ensure a smooth and successful investment experience.


Here are the basic steps of investing in a real estate syndication:

1. Determine your investing goals

2. Find an investment opportunity that fits

3. Reserve your spot in the deal

4. Review the PPM (private placement memorandum)

5. Send in your funds


Step #1 – Determine Your Investing Goals

When investing in a real estate syndication, consider your short-term and long-term investing goals. Consider the amount of capital, timeframe, tax advantages, and whether you’re investing for cash flow, long-term appreciation, or a combination of both. This will help you find investment opportunities that align with your personal objectives.


Step #2 – Find a Fitting Investment Opportunity

Identify your investing goals and find a deal that aligns with them. Real estate syndication projects, including ground-up construction, value-add assets, and turnkey syndications, offer a comprehensive view of the asset, market, sponsor team, business plan, and projected financials. Thoroughly vet the sponsor team, read investment materials, and consider exit strategies, conservative underwriting, and the proposed business plan’s relevance to the asset class, submarket, and current economic cycle. Research market trends, minimum investment requirements, projected hold time, and returns. Attend the investor webinar and ask tough questions. At this stage, look for any reasons not to invest in the deal.


Step #3 – Reserve Your Spot in the Deal

When deciding to invest in a team or opportunity, it’s crucial to reserve your spot in the deal. Deals are filled on a first-come, first-served basis, so research and ask questions before a live deal opens. Clear goals, solidified investment value, and a soft reserve can help you jump on the opportunity when it opens. Combining Steps #2 and #3, reviewing the executive summary, reserving your spot, and reviewing the rest of the materials, allows you to back out or reduce your investment penalty-free. If you’re late in putting in your soft reserve, the deal may be full by the time you decide to invest, leaving you with the option to join the backup list or wait for the next deal.


Step #4 – Review the PPM

To invest in a deal, the first step is to review and sign the Private Placement Memorandum (PPM). This legal document provides detailed information about the investment opportunity, risks, and investor role. It’s crucial to understand the subscription agreement, operating agreement, and shareholding options. Additionally, you can decide on distribution methods, such as check or direct deposit, after signing the PPM.


Step #5 – Send in Your Funds

After completing the PPM, send in your funds as per the wiring instructions found in the PPM document. Double-check the information and inform the deal sponsor to be aware of it.




The process of investing in a real estate syndication is straightforward and less intimidating. It involves upfront participation in choosing a deal, reviewing investor materials, reserving a spot, reading and signing the PPM, and wiring in funds. However, if the process seems daunting, the company is available to help. As you review and invest in more deals, the process will become easier.

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