--- title: What is a Real Estate Syndication? description: When several investors partner together to buy a real estate investment, it is called real estate syndication. image: https://www.realized1031.com/hubfs/Images/photo/abstract/people-meeting-office-IS-1174262820.jpg --- [![Realized 1031 Exchange Marketplace](https://www.realized1031.com/hs-fs/hubfs/Images/Brand/Logo/Realized/Realized-Logo-Black.png?width=240&height=80&name=Realized-Logo-Black.png "Realized 1031 Logo") ](https://www.realized1031.com/) - [Wealth Management Gap](https://www.realized1031.com/the-wealth-management-gap) - [Our Process](https://www.realized1031.com/how-realized-works) - [Financial Advisors](https://www.realized1031.com/advisor) - [Resources](https://www.realized1031.com/resources) - [The Company](https://www.realized1031.com/about-us) - [Articles](https://www.realized1031.com/blog) [Register](https://www.realized1031.com/marketplace) [Log In](https://www.realized1031.com/login) - Better Business Bureau Rating: **A+** - [FINRA BrokerCheck](https://brokercheck.finra.org/firm/summary/22333) - [Call](tel:1-877-797-1031) **(877) 797-1031** # What is a Real Estate Syndication? Posted Mar 8, 2021 ![people-meeting-office-IS-1174262820](https://www.realized1031.com/hs-fs/hubfs/Images/photo/abstract/people-meeting-office-IS-1174262820.jpg?width=750&height=392&name=people-meeting-office-IS-1174262820.jpg) When several investors partner together to buy a real estate investment, it is called [real estate syndication](https://www.realized1031.com/glossary/real-estate-syndication). With the prevalence of the internet, some people also think of it as crowdfunding for real estate.  In a real estate syndicate, the investors pool their funds and can buy higher valued properties than they would be able to on their own. It isn’t always for existing real estate; investors can also use syndication for building new properties.  ### How Does The Partnership Work?  In real estate syndication, there is a managing partner who finds the investment. Other partners then join the investment pool as limited partners. The partners join with a set investment amount, and the funds are combined to buy an income-producing property. There is usually a minimum investment amount set before looking for investors.  The managing partner also develops and executes the business plan and investment strategy.  Generally, in real estate syndication, the partners are in a Limited Partnership (LC) or the syndicate is set up as a [Limited Liability Company (LLC)](https://www.realized1031.com/glossary/limited-liability-company-llc). In an LC the partners are only personally liable for an amount total to their investment, the main or managing partner has unlimited liability. Limited Liability Companies are entities that are set up where partner’s personal assets are protected.  There are other types of real estate syndication, but these are two of the main ways to set up the partnership.  ### Benefits of Real Estate Syndication Like any investment, there are pros and cons of real estate syndication. Let’s discuss a few of the benefits.  - As a limited investor, there is the opportunity for passive income without running the day-to-day operations of the business. This is perfect for hands-off investors who want to see a profit without doing the hands-on work. Most times, a property management company or site manager will run the property.  - Syndicates can be a way to invest with less risk when they are structured with LCs or as an LLC. Also, the risk that is there is spread out over many investors.  - A real estate syndication can allow someone to invest in much more expensive projects than they could on their own. This has the potential for bigger gains, although nothing is guaranteed.  - There are also possible tax benefits with real estate syndication. For example, the depreciation of the property can be written off each year. In addition, you might lower your tax bill because capital gains taxes are generally lower than an individual’s income tax bracket if they have an investment property for more than a year. Sometimes there might also be opportunities to defer capital gains taxes with a 1031 exchange.  ### Disadvantages of Real Estate Syndication While there are benefits to real estate syndication, there are also potential drawbacks. For example, some investors want to be involved in the day-to-day operations, and in a syndicate the managing investor or property manager usually runs the investment property operations.  Another potential drawback is the liquidity of assets in a real estate syndication. Because the investment involves multiple parties, it is not likely that you can access your money quickly.  In addition, real estate syndication can price out many investors because the minimum investment requirement can sometimes be very high. While this means there might be more experienced investors involved in a syndicate, it can prevent new investors from entering the space.  Like any real estate investment, nothing is guaranteed, but real estate syndication can be beneficial to some investors. The best advice is to find an experienced investor or a financial advisor to see if a real estate syndication is right for you.  This material is for general information and educational purposes only. Information is based on data gathered from what we believe are reliable sources. It is not guaranteed as to accuracy, does not purport to be complete and is not intended to be used as a primary basis for investment decisions. Learn Ways To Help Build Long-Term Real Estate Wealth [![Get Tips For Managing Real Estate Wealth](https://www.realized1031.com/hs-fs/hubfs/Images/UI/graphics/composites/IPWM-eBook-250c.jpg?width=250&height=250&name=IPWM-eBook-250c.jpg "Learn new ways to use real ...") ](https://www.realized1031.com/blog/what-is-a-real-estate-syndication#blogform) Download eBook ---   --- ### Get Tips For Managing Real Estate Wealth ![Learn Ways To Help Build Long-Term Real Estate Wealth](https://www.realized1031.com/hs-fs/hubfs/Images/UI/graphics/composites/IPWM-eBook-550.jpg?width=550&height=650&name=IPWM-eBook-550.jpg) Learn new ways to use real estate to pursue your wealth goals. By providing your email and phone number, you are opting to receive communications from Realized. If you receive a text message and choose to stop receiving further messages, reply STOP to immediately unsubscribe. Msg & Data rates may apply. To manage receiving emails from Realized visit the Manage Preferences link in any email received. Search ### [Why Realized](https://www.realized1031.com/why-realized) - [Wealth Management](https://www.realized1031.com/the-wealth-management-gap) - [Why Realized](https://www.realized1031.com/why-realized) - [Our Process](https://www.realized1031.com/how-realized-works) - [Scenarios](https://www.realized1031.com/scenarios) - [Private Client Program](https://www.realized1031.com/private-client) - [Realized Exchange Services](https://www.realized1031.com/realized-exchange-services) ### [The Company](https://www.realized1031.com/about-us) - [The Team](https://www.realized1031.com/about-us) - [FAQ](https://www.realized1031.com/frequently-asked-questions) - [Testimonials](https://www.realized1031.com/testimonials) - [Press](https://www.realized1031.com/press) - [Careers](https://www.realized1031.com/careers) ### [Partners](https://www.realized1031.com/partners) - [Financial Advisors](https://www.realized1031.com/advisor) - [Broker Dealers](https://www.realized1031.com/partners/broker-dealers) - [Real Estate Agents](https://www.realized1031.com/partners/real-estate-agents) - [Certified Public Accountants](https://www.realized1031.com/partners/certified-public-accountants) ### [Resources](https://www.realized1031.com/resources) - #### Learn - [Articles](https://www.realized1031.com/blog) - [Glossary of Terms](https://www.realized1031.com/glossary) - [Capital Gains Tax Rates](https://www.realized1031.com/capital-gains-tax-rate) - #### Watch - [Video Library](https://www.realized1031.com/videos) - [Webinar Archive](https://www.realized1031.com/webinars) - #### Read - [Delaware Statutory Trust](https://www.realized1031.com/delaware-statutory-trust) - [Tenants-In-Common](https://www.realized1031.com/tenants-in-common-tic) - [1031 Exchange](https://www.realized1031.com/1031-exchange) - [Qualified Intermediary](https://www.realized1031.com/qualified-intermediary) - [Qualified Opportunity Zones](https://www.realized1031.com/opportunity-zones) #### Realized - 500 W 13th Street Austin, TX 78701 - (877) 797-1031 ##### [Contact Us](https://www.realized1031.com/contact-us) - [![Realized on Facebook](https://www.realized1031.com/hs-fs/hubfs/Images/UI/Social/Icons/Mix/social-facebook-whiterev.png?width=60&height=60&name=social-facebook-whiterev.png)](https://www.facebook.com/Realized/) - [![Realized on LinkedIn](https://www.realized1031.com/hs-fs/hubfs/Images/UI/Social/Icons/Mix/social-linkedin-whiterev.png?width=60&height=60&name=social-linkedin-whiterev.png)](https://www.linkedin.com/company/realized/) - [![Realized on YouTube](https://www.realized1031.com/hs-fs/hubfs/Images/UI/Social/Icons/Mix/social-youtube-whiterev.png?width=60&height=60&name=social-youtube-whiterev.png)](https://www.youtube.com/c/Realized1031?sub_confirmation=1) - [![Realized Holdings, Inc. BBB Business Review](https://www.realized1031.com/hs-fs/hubfs/Images/professional-assoc/bbb/RZH2-bbb-seal.png?width=40&height=65&name=RZH2-bbb-seal.png)](http://www.bbb.org/central-texas/business-reviews/real-estate-investors/realized-holdings-llc-in-austin-tx-1000112948/#bbbonlineclick) - [![FEA Logo](https://www.realized1031.com/hs-fs/hubfs/Images/professional-assoc/fea/RZH2-fea-logo.png?width=82&height=65&name=RZH2-fea-logo.png "FEA Logo")](https://www.1031.org) SECURITIES DISCLOSURE Realized1031.com is a website operated by Realized Technologies, LLC, a wholly owned subsidiary of Realized Holdings, Inc. (“Realized Holdings”). Securities and/or Investment Advisory Services may be offered through Registered Representatives or Investment Advisor Representatives of Realized Financial, Inc. ("Realized"), a broker/dealer, member [FINRA](https://www.finra.org)/[SIPC](https://www.sipc.org/), and registered investment adviser. Realized is a subsidiary of Realized Holdings, Inc. ("Realized Holdings"). Check the background of this firm on [FINRA's BrokerCheck](https://brokercheck.finra.org/firm/summary/22333). Hypothetical example(s) are for illustrative purposes only and are not intended to represent the past or future performance of any specific investment. Investing in alternative assets involves higher risks than traditional investments and is suitable only for sophisticated investors. Alternative investments are often sold by prospectus that discloses all risks, fees, and expenses. They are not tax efficient and an investor should consult with his/her tax advisor prior to investing. Alternative investments have higher fees than traditional investments and they may also be highly leveraged and engage in speculative investment techniques, which can magnify the potential for investment loss or gain and should not be deemed a complete investment program. The value of the investment may fall as well as rise and investors may get back less than they invested. This site is published for residents of the United States who are accredited investors only. Registered Representatives and Investment Advisor Representatives may only conduct business with residents of the states and jurisdictions in which they are properly registered. Therefore, a response to a request for information may be delayed until appropriate registration is obtained or exemption from registration is determined. Not all of services referenced on this site are available in every state and through every representative listed. For additional information, please contact the Realized Compliance department at 512-472-7171 or info@realized1031.com. - [Terms & Conditions](https://www.realized1031.com/terms-and-conditions) - [Privacy Policy](https://www.realized1031.com/privacy-policy) - [Form CRS](https://www.realized1031.com/hubfs/common-files/disclosures/FormCRS.pdf) - [ADV 2A](https://www.realized1031.com/hubfs/common-files/disclosures/ADV2A.pdf) - [Reg BI Disclosures](https://www.realized1031.com/hubfs/common-files/disclosures/RegBI.pdf) -   © 2026 Realized Holdings, Inc. ```json { "@context" : "http://schema.org/", "@type" : "BlogPosting", "articleBody" : "When several investors partner together to buy a real estate investment, it is called real estate syndication. With the prevalence of the internet, some people also think of it as crowdfunding for real estate. In a real estate syndicate, the investors pool their funds and can buy higher valued properties than they would be able to on their own. It isn’t always for existing real estate; investors can also use syndication for building new properties. How Does The Partnership Work? In real estate syndication, there is a managing partner who finds the investment. Other partners then join the investment pool as limited partners. The partners join with a set investment amount, and the funds are combined to buy an income-producing property. There is usually a minimum investment amount set before looking for investors. The managing partner also develops and executes the business plan and investment strategy. Generally, in real estate syndication, the partners are in a Limited Partnership (LC) or the syndicate is set up as a Limited Liability Company (LLC). In an LC the partners are only personally liable for an amount total to their investment, the main or managing partner has unlimited liability. Limited Liability Companies are entities that are set up where partner’s personal assets are protected. There are other types of real estate syndication, but these are two of the main ways to set up the partnership. Benefits of Real Estate Syndication Like any investment, there are pros and cons of real estate syndication. Let’s discuss a few of the benefits. As a limited investor, there is the opportunity for passive income without running the day-to-day operations of the business. This is perfect for hands-off investors who want to see a profit without doing the hands-on work. Most times, a property management company or site manager will run the property. Syndicates can be a way to invest with less risk when they are structured with LCs or as an LLC. Also, the risk that is there is spread out over many investors. A real estate syndication can allow someone to invest in much more expensive projects than they could on their own. This has the potential for bigger gains, although nothing is guaranteed. There are also possible tax benefits with real estate syndication. For example, the depreciation of the property can be written off each year. In addition, you might lower your tax bill because capital gains taxes are generally lower than an individual’s income tax bracket if they have an investment property for more than a year. Sometimes there might also be opportunities to defer capital gains taxes with a 1031 exchange. Disadvantages of Real Estate Syndication While there are benefits to real estate syndication, there are also potential drawbacks. For example, some investors want to be involved in the day-to-day operations, and in a syndicate the managing investor or property manager usually runs the investment property operations. Another potential drawback is the liquidity of assets in a real estate syndication. Because the investment involves multiple parties, it is not likely that you can access your money quickly. In addition, real estate syndication can price out many investors because the minimum investment requirement can sometimes be very high. While this means there might be more experienced investors involved in a syndicate, it can prevent new investors from entering the space. Like any real estate investment, nothing is guaranteed, but real estate syndication can be beneficial to some investors. The best advice is to find an experienced investor or a financial advisor to see if a real estate syndication is right for you. This material is for general information and educational purposes only. Information is based on data gathered from what we believe are reliable sources. It is not guaranteed as to accuracy, does not purport to be complete and is not intended to be used as a primary basis for investment decisions.", "articleSection" : [ "Real Estate Investing" ], "author" : { "@type" : "Person", "email" : "marketing@realized1031.com", "image" : "", "name" : "The Realized Team", "url" : "https://www.realized1031.com/blog/author/the-realized-team" }, "dateModified" : "2021-03-08T13:00:01+0000", "datePublished" : "2021-03-08T13:00:01+0000", "description" : "When several investors partner together to buy a real estate investment, it is called real estate syndication.", "headline" : "What is a Real Estate Syndication?", "image" : { "@type" : "ImageObject", "height" : 501, "url" : "https://f.hubspotusercontent10.net/hubfs/733513/Images/photo/abstract/people-meeting-office-IS-1174262820.jpg", "width" : 750 }, "mainEntityOfPage" : "https://www.realized1031.com/blog/what-is-a-real-estate-syndication", "name" : "What is a Real Estate Syndication?", "publisher" : { "@type" : "Organization", "address" : { "@type" : "PostalAddress", "addressCountry" : "USA", "addressLocality" : "Austin", "addressRegion" : "TX", "postalCode" : "78701", "streetAddress" : "500 W 13th Street " }, "logo" : { "@type" : "ImageObject", "height" : 60, "url" : "http://www.realized1031.com/hubfs/Images/Brand/Logo/Realized/Realized-Logo-Black-No-Margin-296x60-AMP.png", "width" : 296 }, "name" : "Realized" }, "thumbnailUrl" : "https://f.hubspotusercontent10.net/hubfs/733513/Images/photo/abstract/people-meeting-office-IS-1174262820.jpg" } ```