Syndicated Property Developments

Does anyone have experience pooling funds to create a syndicate focused on property developments? I'm asking about the regulatory aspect as much as the nuts and bolts of how to do it.

I've spoken to all of the usual suspects but am yet to satisfy my curiosity.

This could probably go in the legal or tax sub-forum but this is a good place to start given it's about raising funds.

Thanks!

 

Assuming you're asking in the context of an individual wanting in, the easiest way would be for each person to borrow against equity in existing property. I don't think you'd have much luck any other way.

I'm also interested to hear anyone else's experience with this.

 

Thanks @Jess Peletier

I'm talking more from the admin and structural setup of it. Obviously I'll get the necessary professionals involved but I'd like to hear some first hand experience and pointers as well.

 

Are you cooking something up?

 

Haha just throwing some ideas around with a buddy @Jess Peletier not sure what will happen or when at present

Thanks @The Y-man, I've just been given a run down from an accountant I know about this side of it.

Has anyone been involved in a syndicate?

 

Other than offering a very attractive rate of return they're set up to maximise return to the manager.

 

I have done it a bit and invested in syndicates as well.

They have all gone caput as they were pre gfc Perth.

What is your question?

 

Thanks everyone.

Just a general enquiry as to who has done it and their experiences.

For example I know Momentum Wealth in Perth do a lot of their developments with syndicated money so the structure is still being used, although it's not the core business of Mementum.

 

I have some business clients who run their development businesses this way. Overall not a huge amount of compliance/setup issues - the structure is generally setup with the parties lending to another entity with a set rate of return, either on a p.a or end of development cost. The biggest issue is actually getting sufficient funders together to get the project together, alongside balancing time frames for any option contracts/approvals.

 

Must admit we went the other way and applied for our own Retail AFSL (look 12 months) but been up and running now for 10 months running 2 separate funds.

With a track record rolling our additional Funds is a lot easier and ASIC haven't been too bad to work with.