The country needs 4.6m new apartments by 2030.

How many are needed near you?

We can help!

We empower investors to create slow, lasting wealth by creating value-add opportunities.

The result?  Homes

About

 Red Boot LLC is a private real estate investment firm that provides its clients with access to institutional-quality real estate opportunities. We strategically acquire, manage and sell exclusive real estate to increase our client’s personal wealth with competitive returns.

38
APARTMENT RESIDENTS
20
APARTMENT HOMES
1300
ECONOMIC CONTRIBUTION
12
TOTAL JOBS SUPPORTED

Benefits

SYNDICATION
Over 90% of multifamily purchases are made through a syndication. A syndication allows you to take advantage of the experience and financial strength of the sponsor and to aggregate capital among other investors to invest in otherwise unobtainable, high-value apartments with high returns.
ECONOMIES OF SCALE
Single family properties or small multifamily properties do not have sufficient revenue to hire full time staff. Because of this, owners are typically required to handle all day to day operations of the property. With a multifamily syndication, revenue is sufficient to hire full time staff to operate the property with oversight and direction from the syndicator.
TAX ADVANTAGES
We do not serve as tax strategists. Please consult your CPA for specific benefits of these investment types. Our real estate investments would generally have the primary added tax value of depreciation.
CASH DISTRIBUTIONS
Depending on the level of the value-add component of the asset, most properties will produce a cash yield from the beginning. In some cases where the value-add component is a high vacancy rate, the strategy may require investors to accept more risk with little or no dividends in the beginning in exchange for a larger return later.
PRINCIPAL PAYDOWN
Through the life cycle of the syndication, rental income from the property pays all debt service. Upon sale of the property principal reductions will be returned to investors.
RISK REDUCTION
By investing with other investors through a syndicator with a proven track record, investment risk is dispersed among all the investors. A syndication allows you to adjust your investment to a more comfortable risk level.
CAPITAL APPRECIATION
Unlike single family homes, a multifamily apartment syndication is a business that is valued primarily by its Net Operating Income (NOI), not by property comps. Through physical and operational improvements, you can increase the value of the property by increasing NOI. All of the properties we pursue have a value-add component which provides an opportunity to capture appreciation through capital improvements or through streamlining known operational inefficiencies with current owners.
ASSET PROTECTION
Each syndication purchases the multifamily asset through a limited liability company (LLC). An LLC provides its members with certain personal legal protections against lawsuits and personal financial liability. Consult with your attorney for specific advice on the benefits of investing through a syndication.

Process

VERBL COMMITMENT
Investor Commitment to Minimum Investment Amount or Above (Verbal)
CONTRACT
Deal Under Contract
EMAIL
Deal Package Emailed to Investors
WRITTEN COMMITMENT
Investor Commitment to Minimum Investment Amount or Above (Written)
DUE DILIGENCE
Asset Due Diligence Complete
BEGIN CLOSING
Instruct Closing Attorney to Begin Closing Procedures
INVESTOR DOCUMENTS
Investors Receive Private Placement Memorandum (PPM), Operating Agreement and Closing Instructions
SIGN DOCUMENTS
Investor signs Operating Agreement and Sends Funds to Attorney or Title Company
ASSET MANAGEMENT
Upon Closing on Property, Investors Receive Monthly Email Updates, and Once Property Stabilized, Investors Will Receive Quarterly Reports With Distributions

FAQ

In its simplest form, syndication is the pooling of investor money where the investor is typically a passive, limited partner (LP). The other partner to the deal is the general partner (GP), or active partner that puts the deal together, manages the business plan to provide a return for the benefit of all investors. You will hear General Partner (GP), Syndicate and Sponsor often used interchangeably.

A Multifamily Apartment Syndication allows investors to participate in otherwise unobtainable real estate investment opportunities by aggregating capital and experience by teaming up with other like-minded investors. This also allows you to diversify your capital into other real estate syndications or in other economic sectors.

Generally speaking, sophisticated investors must have sufficient knowledge and experience in financial and business matters to make them capable of evaluating the merits and risks of the prospective investment. To qualify as an accredited investor, at a minimum you must have earned income that exceeded $200,000 (or $300,000 together with a spouse) in each of the prior two years, and reasonably expects the same for the current year or has a net worth over $1 million, either alone or together with a spouse (excluding the value of the person’s primary residence). Reference the SEC guidelines at https://www.sec.gov/answers/rule506.htm for a more detailed description.  To find out if you are qualified under this definition, contact us.

No. Red Boot works with accredited and non-accredited investors.

You don’t need a real estate background to be successful. Despite their different careers, each of our students has demonstrated high-level success in their chosen profession. Multifamily investing is not extraordinarily difficult, but it requires specialized knowledge. If you are prepared to apply the same level of work, discipline, and determination to this endeavor as you have in your previous efforts, you will be successful.

Yes. Investors are able to invest through their traditional self-directed IRAs, but there is a UBIT tax to understand on the SD-IRA as the IRS does not want to see you take advantage of the leveraged portion of the investment. Interestingly, the solo 401K does not have this problem.  Please contact Red Boot LLC if you have questions about how this works or need help selecting a custodian.

You cannot 1031 into our deals or out of our deals since you are technically purchasing units of our Limited Partnership and not actually the land itself. That said, there are mechanisms where we expect to be able to 1031 from one of our deals into another one of our deals, thus deferring the tax you would have normally paid on the sale of the first apartment.

There are three main types of returns from real estate; cash flow, principal pay-down, and appreciation. These returns will vary from property to property.  We will discuss this with you on a deal by deal basis.

You can see the process in the "Process" section, but here is a quick reminder.  Once we have a property under contract, due diligence is about 60 days. We start the equity raise process with investors which runs about 5-6 weeks end to end. Marketing deck goes out, investor conference call takes place, investors reserve a spot, review the PPM / sign and fund. About 2-3 weeks later we close on the property. About 60 days later first investor distribution.

Typically, at time of sale. For our deals, year 5 is the target. It could happen in year 3 or year 7 or longer if we have a long downturn but 5 is typically what value add syndicators have as a target.

Monthly quick updates (email) on how the investment’s progress. Typical bullet points / some pics on how many units were renovated, rents we are getting, etc. Quarterly property management financials can be reviewed. Following March of each year you will receive a K-1 statement from us for your tax filings.

It should be yes. Good sponsors will want to underpromise and overdeliver. You want to review all financial assumptions from the sponsor and ensure they make sense. Key ones to focus on would be rents (check the area comps for before and after renovation pricing – you want to be under where the market is before and after), rent growth and occupancy. Review the T12 (prior 12 months from previous owner). Does the value add improvements, increased income and timing of those improvements make sense to the forecast?

Consult with your CPA for specifics on how this type of investment can impact you. There are typically significant tax advantages from investing in the real estate sector through depreciation. You will receive a K-1 from the partnership.

Joshua K. Sterling, Property Management Advisor

Joshua K. Sterling, Property Management Advisor

Joshua “Josh” K. Sterling is the President of Epic Property Management – https://epicpropertymanagement.com/. Currently, Josh owns approximately 600 units and manages an additional 200 units. He brings a wealth of knowledge about how to manage properties as both an Operator and Vendor to other Operators.

Julie Anne Peterson, Mortgage Advisor

Julie Anne Peterson, Mortgage Advisor

Julie Anne Peterson, Commercial Loan Officer. With 30 years of real estate transaction experience, Julie Peterson does not just source funds; she consults with her clients to help solve their immediate needs. She works with all types of income producing real estate and at all levels of the “capital stack”. Julie’s clients are real estate entrepreneurs who are dependent upon the many relationships they establish, and the relationship with their capital provider is no different. Outside of work, Julie enjoys spending time with her husband and 4 children. Old Capital is a premier provider of commercial Capital solutions and advisory services for commercial real estate investors of Multifamily, Retail, Office, and Industrial. Old Capital brings an extensive network of equity and lending sources, structured finance experience with a focus on acquisitions, and a clear commitment to personalized customer service to the investors properties. We offer prudent advice and proactive transaction management that result in enthusiastic repeat clients. Our mission at Old Capital is to pay attention to the needs of our borrowers and find solutions that work. In 2018, Old Capital closed over $1 Billion in loan transactions.

Mark Langdon, Operator Advisor

Mark Langdon, Operator Advisor

Mark Langdon. Mr. Langdon has been investing in residential real estate since 1991. He has a separate real estate investment firm (Langdon Properties LLC) focused on buying distressed properties; renovating the properties and then re-selling them for significant profits. He also has a strong rental portfolio consisting of 10 units that he has self-managed providing all property management services over the last 27 years. Mark also is a general partner on a 21-unit multifamily apartment in Greensboro, NC.; 32 unit multifamily apartment in Hickory, NC; and a 18 unit multifamily apartment in Anniston, Al. Mark and his wife’s net worth are approximately $ 7.9 MM from real estate holdings, mutual funds and stock portfolio which allows him access to $2.0 MM various credit lines including raising private money to finance his deals. Mark is a licensed Professional Engineer and has worked directly for Honeywell, Merck, Sanofi-Aventis, and First Solar executing projects up to $ 125 MM as the lead project manager. Mark is also married to a mortgage professional with 30 years’ experience allowing favorable financing opportunities for all of their properties. Together Mark and his wife bring strong W-2 income; High net worth, excellent credit (800+), multiple income streams with the required real estate and property management knowledge to be able to execute, manage, and close real estate deals.

Jonathan Mickles, Managing Member

Jonathan Mickles, Managing Member

Jonathan started in Real Estate hosting Cashflow games in the suburbs of Washington, DC. For weeks, he hosted and networked with those interesting in the game until he was recruited to originate mortgages before the crisis of 2008. While originating, he began to get his real estate license to work with investors in purchasing property. Since, he has worked with investors who bought, renovated, and sold properties. He continued his education by receiving certifications as a Certified Distressed Property Expert (CDPE) and Certified Investor Agent Specialist (CIAS). His dynamic personality and gift of Teaching allowed him to be selected by the Charfen Institute as a National Trainer of the CIAS.

Never content, Jonathan continued his education by successfully completing Project REAP (Real Estate Apprentice Program) in 2014. This program seeks to increase minority participation in Commercial Real Estate. His connection to investors who migrated from residential to commercial real estate solidified his decision to become a Real Estate Syndicator specializing in multifamily properties. Jonathan continues to serve as a resource of investors within the Washington, DC area and abroad – connecting them to people and resources as needed.

Michael Blank, Advisor

Michael Blank, Advisor

Entrepreneur. Investor. Teacher.

Michael Blank’s passion is being an entrepreneur and helping others become (better) entrepreneurs. His focus is buying apartment buildings by raising money from private individuals.  He is a full-time entrepreneur, investor and coach and passionate about helping others become financially free in 3-5 years by investing in apartment building deals with a special focus on raising money.

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