Are you thinking about investing in real estate funds? Our guest, Lisa Hylton, shares with us today her knowledge about funds which she acquired while working as a controller on private equity real estate funds a few years back. Now, Lisa has invested in 2 syndications as a limited partner totaling 850 units and one sub-syndication raising 500K.
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There are two options to real estate funds. You have the single asset vehicles and the blind funds. There are pros and cons to consider, but ultimately, Lisa likes funds as a business model because it is resilient to recession and it provides diversification.
Key Points From This Episode:
- Why would you want to invest in a fund and what are the pros and cons?
- There are two types of funds which are single asset vehicles and the blind funds.
- Blind funds provide diversification as opposed to single asset funds.
- Lisa likes the blind fund as a business model because it’s a recession-resistant fund.
- What is one of the key things that people need to think about when they’re looking at a fund?
- As an investor, you need to know and understand what the plan or the deal flow of the operator is.
- What should people know about the fees for multiple assets funds?
- When creating a fund, make sure that the returns that are being presented to you are always after fees.
- What are the differences in structure between a fund or syndication?
- It’s important to invest in a really good and strong market.
- How does Lisa prepare for a downturn?
- What’s her predictions for real estate over the next six to twelve months?
- What’s her best source from meeting new investors right now?
- What’s the number one thing that contributed to her success?
- How does Lisa like to give back?
“One of the key things that they need to think about when they’re looking at a fund is deal flow of the operator. You just want to ask the questions and make sure you are comfortable with the answer. Whatever the answer is, if you’re comfortable with giving your money into that deal, then with those terms then that ultimately is up to you.” [0:11:24.1]
“Typically, fund and syndication are very similar to the extent that they usually have a preferred return, I know a lot of syndicates have preferred return structures already, but they are many that don’t have that, but usually in the fund space, you typically will have a preferred return and you will typically have some kind of waterfall as well.” [0:14:36.9]
“I think that it’s really important to diversify your portfolio. It’s really important as a passive investor to diversify, to learn about other asset classes, and especially the ones that are known to be recession-resistant, such as self-storage, mobile home parks and certain multi-family classes as well.” [0:19:29.5]
Links Mentioned in Today’s Episode:
About Lisa Hylton
Lisa Hylton is a real estate investor, syndicator and a CPA with approximately 15 years of experience in the financial services industry. Lisa started out with a Big 4 accounting firm auditing billion dollar funds across private equity, venture capital, mutual and hedge funds in the Cayman Islands, Boston and then Los Angeles. Lisa’s last role was a controller on private equity real estate funds while investing passively and actively in primarily commercial real estate investments such as large multifamily apartment buildings.
Lisa’s first exposure to real estate started with a 2bed 2 bath townhouse in the Cayman Islands that she bought in her early 20s. This first investment taught Lisa many lessons, the primary ones being the importance of investing for cash flow and how to run the numbers on a property to assess whether it will be an investment with a high likelihood of cash flowing. Fast forward 10 plus years, Lisa’s preferred way to invest in real estate is through passive and active syndications. To date Lisa has invested in 2 syndications as a limited partner totaling 850 units in the Atlanta MSA and one sub-syndication raising 500K with my team of fellow Real Estate Investor Goddesses.
Lisa is also the host of the Level Up REI podcast which airs on Tuesdays and have featured series on the different ways people can play in real estate, Successful Black Men Investing in real estate, The Successful Feminine Real estate Business Owners and the Black Entrepreneurs Leveling Up Series!
Originally from the Cayman Islands, Lisa currently resides in Los Angeles and enjoys dancing argentine tango, salsa, paddle boarding, yoga, hiking, reggae and soca music and traveling.
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