Real estate capital raising and syndication
Real Estate Investors Share How They Raised $20M+ in Equity
Real Estate Investor Success Stories: Hear from 5 real estate investment firms who have raised $20M+
Real estate sponsors who want to see how self storage, office and hotel firms source deals and find equity investors.
Said on the call
"Seventy-five percent of our family offices invest in real estate. On average it makes up about 25 percent of their portfolio."
"We always buy thinking there's a recession around the corner, so we're very conservative. We keep tons of cash available. We buy at a really low basis."
"The conversation starter is immediate, but the relationship is the long term."
Summary
Self storage, office and hotel sponsors on one Family Office Super Summit panel describe how they find deals and fund them. Most buy off market. One storage firm says about 50% of that market is owned by mom and pops, and some owners do not know what their property is worth. The panel also covers recent closings, from storage in Texas and Oregon to a six hotel portfolio in New Hampshire.
On the capital side, the speakers compare friends and family, conference speaking, private equity partners and pension funds. One firm placed $35 million of private equity in three and a half years. Another says 99% of its investors came by word of mouth. The session closes with audience questions on ground-up development and refinancing.
Key facts
- One self storage sponsor placed $35 million of private equity in three and a half years and has about $10 million deployed across seven deals.
- Bridge loans at about 6.6% interest were recapitalized at 4.25% on a group of four storage assets.
- The hotel team completed 11 transactions this year, deployed about $75 million of equity, and is typically 65% leveraged.
Sources
From Richard C. Wilson's Centimillionaire Strategies YouTube channel: Real Estate Investor Success Stories: Hear from 5 real estate investment firms who have raised $20M+. Quotes come from the video captions, lightly edited for readability. Figures are the speakers' own estimates and experience.
General education only. Not legal, tax or investment advice.
Talk to a securities attorney to explore options around syndication structures, investor eligibility rules and offering documents. Do not use AI to write your own legal agreements.
What to take from this talk
- Source deals off market. Several panelists buy off market or through brokers who give them first looks. One storage firm has a contract on a property for almost a million less than it should be worth, because the owner did not know the right price.
- Family offices may hold longer. A hotel investor says private equity partners may need to exit in a certain year because of a mandate. A group of three or four family offices might hold a deal that generates 18% cash on cash. That firm has trended back toward individuals and family offices.
- Marketing starts the conversation. One storage sponsor speaks at investor and self-directed IRA conferences and wears a bold blazer to start talks. He says the conversation starts fast, but the relationship is long-term. He also keeps everyone in a CRM database.
- Repeat investors drive growth. One office firm says 99% of its raising is word of mouth. The speaker says the firm has closed 100% of its deals and many investors return on deal after deal. The speaker also says its deals are fully subscribed, but a larger deal pipeline means it needs more equity next year.
- Refinance when the cycle allows. One storage sponsor is recapitalizing four assets, moving bridge loans at 6.6% into debt at 4.25%. Some investors exit and others stay in. A hotel firm says it is typically 65% used and prefers bank debt to CMBS right now.
Related questions
- How do I raise money for my first apartment deal?Start with the deal, because a good one is far easier to fund than most first-time sponsors expect.
- How do I raise equity for a ground-up development?Size the equity check first, then decide how much you raise yourself and how much a partner covers.
- How do I create a real estate investor presentation?Build it around the investor, keep it short, and make it look clean.
Questions about this video
How much of a family office portfolio goes to real estate?
The host says 75% of family offices invest in real estate. On average it makes up about 25% of their portfolio, so the other 75% is spread across other asset classes.
Why did one hotel firm move back toward family offices and individuals?
The speaker says private equity partners can need to exit in a certain year because of a mandate. A group of three or four family offices might hold a deal that is generating 18% cash on cash, and pensions may not want to hold through a down cycle.
How do the self storage sponsors raise equity?
One sponsor raises $50,000 a unit in syndicated deals and also works with small family offices that write one or two million dollar checks. He builds relationships through speaking and tracks contacts in a CRM.
Put this into practice with the ready to raise checklist. See all real estate capital raising and syndication resources.
