Investing in a Fund vs. an Individual Investment Opportunity



As a passive investor, one of the more important decisions you’ll need to make is whether to invest in private real estate funds or place your money in individual investment opportunities. Each option has its unique advantages and disadvantages but making the right choice that meets your specific needs will help to maximize the return on your investment.


Property-Specific Syndication - Deal-Specific Advantages

Because the syndication is deal-specific, the limited partner has the opportunity to choose which markets and which assets to invest in. Another key advantage is the ability to research the market and the asset in depth prior to making a choice.

Property Specific Syndication - Lack of Diversification Increases Risk

The main disadvantage is that with an individual property syndication there is a lollack of diversification. The money that you invest is committed to only one asset, rather than several, which could increase your risk if the deal doesn’t perform as anticipated. Your money is also committed to only one market, which can be troublesome if there’s a recession. Not all markets are impacted the same way during a recession, and without diversification you’re unable to minimize any risk.


Private Real Estate Funds - An Experienced Sponsor is Your Kery to Success

Private real estate funds are different from individual property syndication, but there are many similarities as well. Funds are run by experienced sponsors who develop the overall investment strategy, manage all aspects of the investors’ capital, and are responsible for the fund’s performance. Unlike an individual property syndication, the funds are not limited to