While the options for investing in real estate seem endless, we’ll walk you through the most popular ways to invest in multifamily so you can make the best choice for your investment strategy and goals.
Read on as we show you how investing in multifamily real estate works with Colony Hills Capital.
Why Invest in Multifamily Real Estate?
Multifamily real estate is a fantastic investment strategy for ambitious investors looking to build generational wealth, generate passive income, and reduce their tax burden.
However you choose to invest, several benefits compound over the long term such as:
- Cash flow
- Passive income
- Valuation potential
- Hedge against risk
- Tax benefits
Let’s explore the ways you can invest in multifamily real estate next.
How to Invest in Multifamily Real Estate
When investing in multifamily real estate you’ll be faced with a few common options:
- Buy and manage the property: A common way to invest in real estate is to purchase a property and rent it out yourself or with the help of a property management company. This requires significant effort though and exposes you to tenant demands.
- REIT: A real estate investment trust allows you to purchase shares in real estate portfolios like a mutual fund. This makes REITs a great way to invest in real estate while benefiting from a diversified portfolio.
- Private fund/syndication: By investing privately through a syndication you get the best of both worlds between owning a property and a REIT: you are a part-owner of the property but you are removed from the day-to-day management.
At Colony Hills Capital, we specialize in private funds and syndicated deals, so let’s explore that in more detail.
What is a Real Estate Syndication?
A real estate syndication is where a group of individuals/companies pool their money together to purchase a property and benefit from the rental income and potential appreciation that the property provides.
Real estate syndications are comprised of two groups:
- The syndicator(s)/General Partners
- Passive investors/Limited Partners
At Colony Hills Capital we structure our deals differently: unlike other deals and funds that accept passive investors as limited partners, we invite passive investors to invest as Co-GPs. In other words, you get to invest passively like an LP but reap all the benefits of a GP.
As an investor in the syndication, you’ll get many benefits:
- Passive income from the property
- Appreciation of the property once it is sold
- Tax benefits that come with investing in real estate
All while sharing the same benefits we do while assuming none of the responsibilities of a GP.
How Investing with Colony Hills Capital Works
As the sponsor of the deal, Colony Hills Capital finds investment opportunities and arranges the purchase and management of the property.
There are two ways that you can invest with us:
- Invest in a diversified fund: You can invest in a diversified portfolio of multifamily properties through our funds. Our third multifamily fund, Catalyst Real Estate Fund III, is currently accepting investors.
- Invest in an individual property: We periodically offer direct investments into a deal alongside our team. Browse our current offerings to stay tuned for our next offering.
We specialize in value-add multifamily real estate, representing the highest-demand rental property sector. While there are no guarantees, these properties are considered “recession-proof” due to their price points and ability to weather financial storms while performing well in financial boom times.
By seeking out underperforming properties, we stand a better chance of appreciating the property and generating a return on the sale through targeted improvements and active management.
How Long Do You Invest For?
Our real estate funds and syndicated deals are structured around a set timeframe for holding the property. These agreements can range from 3 to 5 years, after which the property is sold, benefiting the investors, who share in the profit in addition to receiving income during ownership, when available.
What are the Steps to Invest?
Investing with Colony Hills Capital is simple!
First, browse our current offerings to find the right opportunity that interests you and suits your needs. Once you find an opportunity you like, fill out the form on the landing page for it to get in touch with our investment team.
We will then schedule a call to discuss the opportunity in detail and ensure it is a match for your investment strategy. If it’s a match, we will invite you to our investor portal where you can review the investment documents, verify your accredited investor status, and then invest.
Who Can Invest?
Due to the nature of a real estate syndication as an investment that is not as strictly regulated by the SEC such as stocks or bonds, only accredited investors are able to invest.
An accredited investor is a person (or entity) who can invest in private securities that are not regulated by the Security and Exchange Commission (SEC). As an accredited investor, you can participate in private investment opportunities, such as private placements and venture capital deals, that are typically unavailable to the general public.
There are a set of requirements that you need to meet. These requirements are broken out into a series of categories:
- Income: You need an annual income of at least $200,000, or $300,000 if combined with a spouse’s income. This needs to be sustained from year to year.
- Skills: If you work in investments professionally (as an advisor or broker-dealer for example) or hold a valid Series 7, 65, or 82 license you can qualify as an accredited investor.
- Net Worth: If you have a net worth of $1 million or more (individually or with a spouse) not including the value of a primary residence.
If you meet any one of these criteria, then you qualify!
Ready to Invest? Here’s Your Next Step
If you’re ready to reap the many benefits of investing in a Co-GP Fund then take the next step to invest in the Catalyst Fund III by Colony Hills Capital. Colony Hills Capital has previously sponsored two multifamily Co-GP Funds: Catalyst Real Estate Fund and Catalyst Real Estate Fund II.
Investors are welcome from September 2023 to February 2025, this is a unique opportunity that you will not want to miss. Learn more about Catalyst Real Estate Fund III and take the next step to join today.