REAL ESTATE SYNDICATION
Real estate syndication is the process of combining capital from a group of investors to purchase real estate. In many cases, the purchase is one for which other financing is either not available or is on prohibitive terms. Real estate syndication has become a popular method of financing the purchase and sale of commercial properties such as shopping centers, office buildings and warehouses — usually, real estate that is fully leased by tenants at the time of purchase.
Each member of a real estate syndication is either the owner of a debt (loan interest) or equity (ownership interest) security regulated by Federal and State securities laws. These vehicles for raising capital are referred to as private placements of securities and are typically non-public offerings of securities to a small, select group of investors.
Bringing Experience to Syndication
The Real Estate and Development Team at McGuire, Wood & Bissette has experience helping issuers of private placement securities. We assure compliance with securities laws and when appropriate exemption from the difficulties of registration.
Typically, these forms of securities issuances fall under Regulation D of the Securities Act. Many are limited so that interests only can be purchased by Accredited Investors (those who can prove a minimum level of worth or income). Our Real Estate and Development Team can help organizers of real estate syndications with the structuring and formation of the appropriate investment vehicle (usually a limited liability company), including developing appropriate terms of management, control and distribution.
Our experience also includes both state and federal regulatory compliance, including handling special state disclosures and “blue sky” considerations and advising on the changing regulatory environment for such transactions.