If this is the case, this could result in a guaranty fee.Ī guaranty fee is often paid once at closing to the loan guarantor for his or her role in signing on the loan. 5 percent of the new loan amount obtained.Ī syndicator may use a person with a high net-worth/balance sheet to sign on the loan to receive the most lucrative financing terms for the property. The most common per unit asset management cost would be $200-$300 per unit annually.Īlthough a refinance does not always occur, a refinancing fee could be paid to the real estate syndication company as compensation for the work required to refinance the property. In some cases, the asset management fee could be charged per apartment unit. In most cases, syndicators will charge a 1 to 3% percent asset management fee based on the gross revenue collected from the property and would be paid out either monthly or annually. The asset management fee serves to reimburse the real estate syndication company for operating and managing the property during the investment.

The asset management fee is a continuous charge paid to the real estate syndication company. The acquisition fee is a one-time payment paid to the real estate syndication company at the time of closing. For example, if the acquisition fee was 3% on a 10 million dollar apartment building- the real estate syndication company will receive $300,000 at closing. The larger the deal size, the higher the acquisition fee. The acquisition fee will vary from 1% to 5% of the property’s purchase price, and the percentage will depend upon the size of the deal. Most real estate syndication companies will charge an acquisition fee. Today’s article will be walking through the fees associated with real estate syndications and how real estate syndication companies get paid! Whether you are interested in passive real estate investing or looking to syndicate your real estate deals, read along to examine the fees associated with syndications.Īn acquisition fee in real estate serves as compensation for finding the deal and structuring the real estate syndication! If you are interested in learning more about multifamily real estate syndications, please check out our complete guide here: Multifamily Syndications. At the same time, it also provides an opportunity for investors to get involved entirely passively and hassle-free!

Real estate syndications are an incredibly powerful way for syndicators to leverage the knowledge and resources of others. The federal Securities and Exchange Commission (SEC) supervises the syndication of real estate because it will involve the sale of “securities” in the form of an “investment contract.

Real estate syndication is defined as combining the resources of several different real estate investors to complete a large commercial transaction.

Real estate management fees