Co-Investing: Partner with Us on Our Next Rental Property
True Partnership: Your name goes on the deed just like ours.
Learn by Doing with a “My First Property” Partnership
Looking to dip a toe into real estate investing? Learn the ropes?
We’ve got you covered. To help bring our real estate investing courses to life, we wanted to take new investors behind the scenes with actual rental property deals. Then it struck us – many of our students don’t just want to learn, they also want to participate hands-on!
Our co-investing program lets you partner with us on a live real estate deal. It’s not a syndication: you become a full partner on the owning LLC with full voting rights and privileges.
Or Simply Partner with Us to Diversify!
When we talked to Leif Kristjansen about him potentially finding these coinvesting deals, he thought for a moment then replied “Yeah… that sounds like a lot of work. But I’ll definitely participate as a financial partner to diversify my portfolio!”
Rental properties come with several drawbacks. First, it takes labor and skill to find good deals. Beyond that, rental properties cost a lot – a 20% down payment on a $250,000 property is $50,000, which not all of us have just lying around.
Which makes it hard to diversify, when each individual asset takes up $50,000 of your capital.
To solve these problems, we’re allowing a few people to partner with us on each deal, in increments of 1%. For a $120,000 property, that comes to $1,200 increments. A co-investing partner could join us with a 1% ownership stake for $1,200, or 5% ownership for $6,000 if they prefer, or some other percentage entirely.
The Market, Properties, and Returns
Deni and I partnered with Drew Sygit of Logical Property Management, who operates in the Detroit-Warren-Dearborn metropolitan area. (More on Drew shortly.)
We work with “B” class neighborhoods catering to solid middle-class residents. Think working professionals like educators and skilled tradespeople like electricians.
As for returns, we aim for properties with 8-10% cap rates. We buy with cash rather than investment property loans, so our cash-on-cash returns also come in that 8-10% range.
Rent distributions to all partners go out quarterly.
Buyout: What If I Want to Sell My Shares?
On the one hand, rental properties are inherently long-term investments. You buy and hold real estate over the course of years, allowing it to appreciate as it generates ongoing income.
But we also get that “stuff” happens. Sometimes you get hit with a financial emergency and need to liquidate everything right now.
So if you need to sell your ownership percentage, you can do so in one of three ways:
- You can try and sell it on your own, to people you know (and hopefully like),
- We can post your ownership interest for sale in our Facebook group for landlords and real estate investors, or
- Or we’ll buy out your portion ourselves if you don’t find takers, at a 10% discount in the first year, 5% discount in the second year.
Simple and straightforward.
Getting to Know Us: Your Partners
You probably already know Deni and me, as a SparkRental reader 😊
Deni started her real estate career as a property manager. She later became a landlord, real estate investor, and licensed real estate agent.
I started as an account executive handling investment property loans. I then started buying rental properties myself, and later writing for publishers such as BiggerPockets, Money Crashers, and REtipster as an expert real estate correspondent.
Our partner on the ground in Michigan, Drew Sygit, also serves as a top real estate contributor for BiggerPockets (which is how we met, in fact). He’s been a landlord and property manager for nearly 20 years, but his firm also provides rental property acquisition services. In other words, he helps investors find great deals on turnkey properties or BRRRR properties, and then sticks around to manage them if the owner wants.
Between us, we have over 60 years of real estate investing experience. So yeah, we’d like to think we know what we’re doing.
Who Can Partner with Us?
The short version: if you’re a member of our audience, we’ll probably work with you.
But this is not a public offering, not a syndication, not crowdfunding, not securities. We accept a handful of joint venture partners on these deals, not the masses.
You do not have to be an accredited investor. You do have to be someone we feel we can trust as a partner – because you will be our partner in a real and literal sense. We speak personally with all prospective co-investing partners before greenlighting them.
We only accept a dozen or so co-investing partners on each deal, and our FIRE from Real Estate course students get first dibs.