NOTICE: This is not a general solicitation or an offer to sell specific securities.
As an apartment syndicator, Source Capital locates, structures, and executes investment opportunities in the multi-family residential space. We target mid to high-teen IRR returns to partners. If you meet the qualifications for investing you may have an opportunity to participate.
Typical Entity Structure
Managing Member LLC:
Source Capital serves in the capacity of Managing Member through a Management Member LLC. Managing Member will engage in the business of acquiring, improving, operating and disposing of multifamily real estate assets. We run the project through the entire life cycle.
Private Equity LLCs for Targeted Real Estate Assets:
Qualified investors are offered an opportunity to diversify a portion of their assets into managed real estate investments via a Limited Partnership or another like-vehicle in accordance to the guidelines put forth by the Securities and Exchange Commission (SEC) in Rule 506 of the Regulation D.
In order to accommodate acquisition of larger assets which offer more upside and in order to increase the IRR, investments will typically be leveraged via 70% – 80% LTV institutional loans. The remainder of the capital, including the down-payment, escrows, deposits, impounds, and other is provided by Member’s capital. Members are Limited Partners. The institutional loans are non-recourse to the Limited Partners.
Entity structure is transaction-specific, but the following guidelines are generally observed.
A Delaware Limited Liability Company will be formed. All of the Partners (limited and general) are members in this entity. This entity owns the asset.
A Managing Member LLC is formed in Delaware – this is the General Partner.
All of the entity formation, organizational documentation, subscription packet, and the appropriate SEC filings are done by a qualified attorney.
Are You Qualified?
Accredited investors may be invited to participate. Under certain circumstances un-accredited but sophisticated investors may be able to participate as well.
The SEC defines an accredited investor in the following way:
In the United States, to be considered an accredited investor, one must have a net worth of at least $1,000,000, excluding the value of one’s primary residence, or have income at least $200,000 each year for the last two years (or $300,000 combined income if married) and have the reasonable expectation to make the same amount or more into the future.
If you qualify and would like to discuss available opportunities, please complete the form below and I will be in touch.