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  • Our Team
  • Strategy
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    • FAQ
    • Blog
    • Partnerships
  • Investing Process
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  • Contact

FREQUENTLY ASKED QUESTIONS

A real estate syndication is simply a group of investors pooling their money to buy a property together. The general partners handle the day-to-day work — finding, financing, and managing the deal — while limited partners invest passively and share in the cash flow, tax benefits, and profits when the property sells. It’s a way to own real estate without being a landlord.


A syndication typically has two groups: general partners (GPs) and limited partners (LPs). The GPs find the property, arrange financing, and handle day-to-day operations. The LPs invest passively, sharing in the cash flow, tax benefits, and profits—without having to manage the property themselves. It’s a partnership that combines experience and capital to make larger, more profitable deals possible. 


Investors (the limited partners) typically earn money in two ways: ongoing cash flow from rental income, and profit at sale when the property is refinanced or sold. Most deals pay quarterly distributions, which are often tax-advantaged thanks to depreciation. When the property sells, investors receive their share of the profits — including their original investment back — based on their ownership percentage.


 You can invest in a syndication using a variety of capital sources. Most investors use personal savings, cash from a brokerage account, or proceeds from other investments. You can also use retirement funds through a Self-Directed IRA (SDIRA) or Solo 401(k) — both allow you to invest in real estate while keeping your tax-deferred status. Some investors even tap home equity or business liquidity for diversification.


No matter the source, the key is ensuring your funds are available for a long-term, illiquid investment—typically 5 to 7 years.


Real estate syndications offer a way to invest in large, professionally managed properties without the time or stress of being a landlord. Here are five key benefits investors often experience:

  1. Passive Income – Earn regular cash flow from rent distributions without dealing with tenants, maintenance, or daily operations. It’s a hands-off way to enjoy the rewards of real estate ownership.
  2. Tax Advantages – Depreciation and cost-segregation studies allow investors to offset much of the income received, often making distributions tax-deferred or even tax-free during the hold period.
  3. Appreciation & Equity Growth – As properties are improved and rents rise, investors share in the increased value, leading to additional profits at sale or refinance.
  4. Diversification – Syndications let you own a portion of high-quality, institutional-grade assets across multiple markets and deal types—spreading risk beyond a single property or region.
  5. Leverage & Scale – By pooling capital with other investors, you gain access to larger, better-performing properties that offer professional management and economies of scale.


In short, syndications combine the stability of real estate with the scalability of teamwork—helping investors build long-term wealth without the day-to-day involvement.


 Every investment carries risk, and syndications are no exception. While multifamily assets tend to be more resilient than many other investment classes, it’s important to understand the potential downsides:

  1. Market Fluctuations – Economic shifts, rising interest rates, or local employment changes can affect occupancy, rent growth, and property value.
  2. Operational Risks – Renovations can run over budget, expenses may increase unexpectedly, or management issues can reduce cash flow.
  3. Illiquidity – Syndications are long-term investments, often held for five to seven years. Investors should be prepared to keep funds invested until the business plan is complete.
  4. Sponsor Risk – Performance depends heavily on the sponsor’s experience, integrity, and ability to execute the business plan effectively.
  5. Regulatory or Lending Changes – Shifts in lending standards or housing regulations can impact returns or exit strategies.
     

At Rampant Lion Capital, we mitigate these risks through conservative underwriting, strong partnerships, active asset management, and transparent investor communication—always with a focus on preserving and growing investor capital over time.


Typically, each syndication is set up as its own Limited Liability Company (LLC) or Limited Partnership (LP)—a separate entity formed specifically for that property. Investors purchase membership units (similar to shares) that represent their ownership percentage.


The Operating Agreement governs how everything works—defining roles, voting rights, profit allocation, and how capital events (like refinances or sales) are handled. This legal structure protects investors’ liability and ensures profits are distributed according to the agreed terms.


 In most multifamily syndications, you’ll see two entities:

1. Managing LLC (or “Manager LLC”)

  • This entity is controlled by the General Partners (GPs) — the sponsor team.
  • It acts as the manager of the investment and is responsible for making all operational decisions: acquisitions, financing, renovations, asset management, and eventual sale.
  • Importantly, this entity does not directly hold title to the property.
  • By separating the management function, the GPs shield themselves (and investors) from liabilities that could arise from operational activities.

2. Ownership LLC (or “Property LLC”)

  • This is the entity that actually owns the real estate.
  • It holds title to the property, signs the loan documents, and collects income.
  • The Ownership LLC is typically managed by the Managing LLC, which means investors become members (Limited Partners) in the Ownership LLC, while the Managing LLC executes the business plan on their behalf.

 

Control and Voting Rights

As a Limited Partner, your liability is limited, and your role is passive — meaning you won’t be involved in day-to-day operations. That said, LPs could maintain important voting rights. Every detail of these rights is clearly outlined in the Operating Agreement, which we encourage every investor to read closely. You could have the opportunity to vote on major structural changes, such as amendments to the Operating Agreement, a sale, or refinancing. 

 

Why the Two-Entity Setup Matters

This structure creates a corporate firewall between different types of liability:

  • If a lawsuit or claim arises from property operations (e.g., a tenant injury or vendor dispute), it’s contained within the Ownership LLC that holds the asset — protecting the sponsor’s broader business and other investors.
  • If a claim arises from a management or contractual issue, it stays within the Managing LLC — preventing it from jeopardizing the property itself.
  • It also clarifies who does what: the Managing LLC makes decisions; the Ownership LLC owns the asset; and investors have membership interests in the entity that holds the property.
     

In Practice

At Rampant Lion Capital, we follow this layered approach to maintain clean, compliant, and risk-controlled structures. Each property is isolated in its own Ownership LLC, managed by a separate Managing LLC under the sponsor umbrella. That way, if something ever goes wrong with one project, the others — and the investors behind them — remain fully protected.


Syndications are designed to reward both the investors who provide the capital and the operators who execute the business plan. To do that fairly, each deal defines how profits are "split", how investors are paid first, and when the sponsor earns their share.


Equity Splits

Most multifamily syndications divide ownership between Limited Partners (LPs)—the passive investors—and General Partners (GPs)—the operators. A typical structure might look like 70/30 or 80/20, meaning investors receive 70–80% of the ownership and profits, and the sponsor receives 20–30% for sourcing, managing, and executing the deal.


The GP’s portion is called carried interest, earned only when the project performs. The LPs receive most of the returns because they’re contributing most of the capital, while the GP’s smaller share reflects their time, experience, and operational risk.


Preferred Returns

Some syndications include a preferred return (often 6–8%). This is a targeted return that gives investors priority on cash flow before the sponsor earns any profits.


It’s not a guaranteed payment—it simply means that if the property produces enough income, the first 6–8% of available profits are distributed to investors before the GP participates in the split. Think of it as a performance priority, not interest or a fixed income payment. The investment isn’t a loan—it’s equity. You’re an owner, not a lender. If the property underperforms or experiences a cash shortfall, the preferred return can accrue and be paid later, but it isn’t owed like debt.


While that sounds appealing, preferred returns can sometimes create misaligned incentives — especially if a project underperforms early on. When distributions fall behind, the accrued preferred return can make it difficult for operators to “catch up,” leading to rushed decisions or premature sales. We’ve chosen to only offer a preferred return when it makes sense (i.e. when there's enough "meat on the bone"). We prefer to provide consistent cash flow that aligns both our incentive to operate the property efficiently and our capital event (refinance or disposition) decisions. Our structures usually only offer an equity split, ensuring complete alignment — we only get paid when our investors do. If the property doesn’t produce cash flow, no one gets paid. It keeps everyone focused on the same goal: performance.


Why Returns Aren’t Guaranteed


Unlike a savings account or bond, real estate syndications are not guaranteed investments.

They depend on real-world variables—market conditions, property performance, interest rates, and operational execution. Because this is an equity investment, returns can fluctuate based on performance and markets. Investors participate in the upside when the property performs well and share in the risk if it doesn’t. That’s why it’s critical to review each project’s assumptions, underwriting, and sponsor experience before investing.


In Summary

A syndication’s return structure is designed to:

  • Reward investors first
  • Align interests between the sponsor and investors
  • Allow everyone to benefit when the property performs


The structure isn’t about guarantees—it’s about partnership. When the deal succeeds, everyone wins together.


Would you like me to expand this into a visual “return waterfall” explanation (with an example showing preferred return, return of capital, and profit split) for your investor education page or deck?


At Rampant Lion Capital, we believe clarity and communication build confidence. Our process is designed to make your investment experience seamless—from your first conversation with our team to the day you receive your first distribution.


Step 1: Schedule a Call with the Sponsor

Before anything else, let’s connect. Every successful partnership begins with trust and understanding. Schedule a brief introductory call to learn more about Rampant Lion Capital, our investment philosophy, and our upcoming opportunities.


Step 2: Learn About the Opportunity

Once we identify a new multifamily investment, we notify our investors by email with an Executive Summary and a live webinar invitation. During the presentation, we review the market, business plan, and projected returns—and answer all investor questions in real time.


Step 3: Submit a “Soft Commit”

If the opportunity aligns with your goals, you can reserve your spot with a simple soft commitment. This short form indicates how much you intend to invest (typically a minimum of $50,000). It’s not binding—it just helps us gauge interest and allocation.
Soft commits are accepted on a first-come, first-served basis and usually remain open for only a few days following the webinar.


Step 4: Register in the Investor Portal

If you’re new to Rampant Lion Capital, you’ll receive access to our secure Investor Portal.
Through this portal, you’ll review documents, sign electronically, track distributions, and stay updated on your investment’s performance—all in one place.


Step 5: Verify Investor Qualifications

To comply with SEC regulations, we confirm that each investor qualifies as either accredited or sophisticated under Regulation D, Rule 506(b).
If we haven’t yet built a prior relationship, we may need to strengthen that connection before participation in a future offering.


Step 6: Make a Formal Commitment

Investors who’ve soft-committed now have the opportunity to finalize their allocation.
At this stage, you’ll indicate your exact investment amount and formally reserve your equity position in the syndication.


Step 7: Review & Sign Legal Documents

Once allocations are confirmed, you’ll receive a secure DocuSign package containing:

  • Private Placement Memorandum (PPM): Detailed structure, terms, and risk factors
  • Operating Agreement: Responsibilities and ownership of the General and Limited Partners
  • Subscription Agreement: Your share of membership units in the investment entity
  • Accredited Investor Form (if applicable)
  • Direct Deposit Form: For automatic distribution payments
     

Step 8: Fund the Investment

After signing, you’ll receive wiring instructions from our escrow attorney. Funds are typically due within a few days.
Once received, your position is secured—welcome to Rampant Lion Capital’s investor community.


Step 9: Closing & Ongoing Updates

Closings generally occur within 30–45 days. You’ll receive a final confirmation at closing and regular updates thereafter.
Our team provides monthly performance reports, financial summaries, and webinar updates so you always know how your investment is performing.


Our Process in Summary

  1. Schedule a call with the sponsor (extremely important)
  2. Learn about new opportunities
  3. Submit a soft commit 
  4. Register on the investor portal
  5. Verify investor qualifications
  6. Sign legal documents
  7. Fund your investment
  8. Receive closing confirmation and ongoing updates


We spend the majority of our time networking with direct sellers, local brokers and property managers, and others involved in the commercial (multifamily) real estate space to find deals. We typically look at hundreds of deals, to offer on ten, to get one or two under contract.


Underwriting

Underwriting involves evaluating a multifamily community to assess its potential returns and determine an offer price.


Pro-Forma

A Pro-Forma is the projected budget for an apartment building (income and expenses) over the next 12 months and 5 years.


Rent Comparable Analysis

Performing a Rent Comparable Analysis refers to the process of studying similar multifamily properties in the area to establish market rents and understand the competition in order to establish the Pro-Forma projections.


Letter of Intent

A Letter of Intent (LOI) is a non-binding agreement the GP submits to the seller to propose the most important purchase terms, such as price, down payment, and time to close. Once the parties agree on the LOI, it’s then handed to the attorneys to draft a Purchase and Sales Agreement (PSA).


Private Placement Memorandum

The Private Placement Memorandum (PPM) is a legal document required by the Securities and Exchange Commission (SEC) that outlines the objectives, risks and terms of making a particular investment. This document is prepared by an attorney that specializes in private placements and syndications.


Exit Strategy

The Exit Strategy is a plan for cashing investors out of a multifamily deal, either by refinancing the property or selling it once the business plan is realized. 



 

At Rampant Lion Capital, we structure financing that maximizes returns and minimizes risk.
Understanding the types of loans available helps investors appreciate how we position each asset for long-term success.


A Permanent Agency Loan is a long-term, government-backed mortgage secured through Fannie Mae or Freddie Mac. These are the most cost-effective loans in multifamily lending—offering the lowest interest rates, longest amortizations, and no personal guarantees.
To qualify, a property must maintain at least 90% occupancy, reflecting strong and stable performance.


A Bridge Loan serves as short-term, transitional financing—commonly used when a property doesn’t yet meet agency loan requirements.
When occupancy falls below 90% or the property needs repositioning, this loan provides the capital to execute renovations, improve operations, and raise occupancy.
Once stabilized, the asset is typically refinanced into a Permanent Agency Loan, locking in long-term favorable terms.


A Refinance replaces an existing loan with a new one—often at improved terms or higher valuations. For value-add or distressed multifamily assets, a refinance allows the General Partner (GP) to capture increased equity created through operational improvements and then return a portion of investor capital while continuing to own the property.
This strategy can significantly enhance investor returns without requiring a full sale of the asset.


Our Approach

Rampant Lion Capital’s financing strategy is built around one principle:

Leverage smartly, stabilize strategically, and protect investor capital at every stage.
 

Our team continuously evaluates market conditions, debt structures, and interest-rate environments to optimize both performance and preservation of investor equity.


At Rampant Lion Capital, our underwriting process is rooted in integrity, transparency, and data-driven analysis. We believe investors deserve full visibility into both the people behind an opportunity and the performance potential of the asset itself.


When evaluating any multifamily real estate syndication, our objective is simple: Protect capital first, then grow it through disciplined execution.
 

Key Areas of Evaluation

1. The Sponsor & Team

Before anything else, we evaluate the  integrity, experience, and track record of the sponsor team. Investors should always know who is managing their capital, how decisions are made, and what operational history supports the business plan.


2. Alignment of Strategy & Investor Goals

Every investment opportunity should fit within your broader financial strategy—whether that’s long-term appreciation, current cash flow, or a balance of both. We clearly outline how each project aligns with investor objectives, risk tolerance, and expected time horizon.


3. The Investment Itself

We conduct a deep analysis of the specific asset—its income, expenses, renovation scope, debt structure, and projected returns. You’ll understand exactly what drives performance, how risk is mitigated, and how we plan to achieve the targeted returns.


4. The Market Fundamentals

Location remains one of the most critical factors in multifamily performance.
We analyze local job growth, population trends, rent velocity, and supply pipelines to ensure every asset is positioned in a market with long-term fundamentals—not short-term hype.


Investor Guidance

In an ideal world, the majority of this information should already be presented by the General Partner through their offering materials or investor portal.
At Rampant Lion Capital, we go beyond that—providing educational content, transparent reporting, and proactive communication to help investors make informed, confident decisions.


The Rampant Lion Standard

Our investors know exactly how we operate:

  • We underwrite conservatively.
  • We communicate consistently.
  • And we only pursue opportunities that meet our highest standards of integrity and performance.
     

Disciplined due diligence. Transparent communication. Aligned partnerships.


Choosing the right sponsor team is the single most important decision a passive investor can make. At Rampant Lion Capital, we believe that trust is earned through transparency, experience, and consistent execution. Below is a framework we encourage all investors to use when evaluating potential General Partners (GPs)—including us.


1. What Is Your Track Record?

A sponsor’s performance history is the best predictor of how they’ll manage your capital.

Look beyond the number of deals completed—ask how those investments actually performed compared to initial projections.

Underperformance isn’t always a red flag, but it’s critical that the sponsor can clearly explain what happened, what they learned, and what systems they’ve implemented to prevent similar outcomes in the future.


Be cautious of:

  • Sponsors who have only acquired and managed deals but have never completed a full business plan (refinance or sale).
  • Operators who haven’t faced challenges or downturns.
     

At Rampant Lion Capital, we value experience earned through adversity. Teams who’ve weathered economic cycles—whether the Great Recession or other market disruptions—tend to stay calm, data-driven, and solution-oriented when conditions shift.
 

2. Why Should I Invest With Your Company? What Sets You Apart?

Investors choose Rampant Lion Capital for three core reasons:


Conservative Underwriting

We never stretch assumptions to make a deal look better on paper.
Our acquisitions prioritize cash flow from day one, ample reserves at closing, and long-term, fixed-rate debt structures designed to ride out market volatility.


Transparency

We maintain clear, proactive communication with our investors through detailed monthly performance reports, webinars, and timely email updates.
If questions arise, our investor relations team responds personally—usually within hours, not days.


Trust & Education

We’re educators as much as operators. Our community of investors values the resources we provide—guides, webinars, podcasts, and ongoing insights—to help them make informed, confident investment decisions. Trust is built long before you fund a deal. Our investors know us, our philosophy, and our process before they ever commit capital.
 

3. Who’s on Your Team?

Multifamily success depends on the strength and alignment of the entire operating team.
When vetting a sponsor, ask about their:

  • Real estate attorney (experience with syndications and securities)
  • Mortgage lender or broker (track record closing multifamily loans) 
  • CPA or accounting firm (depth in real-estate-specific tax strategy) 
  • Property management company (the most critical partner in execution)
     

The property management team directly impacts occupancy, tenant quality, and ultimately returns.
Ask:

  • How many units do they currently manage? 
  • How long have they been in business? 
  • What systems do they use for tenant screening and maintenance? 
  • What is their communication process with both tenants and ownership?
     

At Rampant Lion Capital, we only work with property management partners who demonstrate operational excellence, accountability, and a commitment to resident experience—because that’s what drives consistent performance.
 

4. Do You Use the Same Property Management Company for All Properties?

Consistency matters—but so does market expertise.
A sponsor working across multiple markets may partner with more than one management firm. If so, ask whether they have a dedicated asset manager overseeing performance across the portfolio and how that individual ensures uniform reporting and oversight.


5. Who Is My Point of Contact?

As an investor, you should always know who to call.
Your point person within the general partnership should be directly involved in the deal and experienced enough to answer your questions with clarity and confidence.

Rampant Lion Capital provides every investor with a dedicated contact throughout the life of the investment—because communication builds trust.


6. Have You Ever Been Sued?

It’s an uncomfortable question—but a necessary one.
Legal disputes can impact both operations and returns, even when investors have limited liability. If a GP has faced litigation, ask what the circumstances were, how it was resolved, and what safeguards are now in place to prevent recurrence. Transparency in this area often says more about a sponsor’s integrity than a spotless record ever could.


Our Standard

At Rampant Lion Capital, our investor relationships are built on three core principles:

  • Integrity in every decision 
  • Clarity in every communication 
  • Accountability in every outcome
     

We encourage investors to ask the hard questions—because strong sponsors never shy away from transparency.
 


 

Before investing in any multifamily opportunity, it’s critical to understand how the sponsor operates—not just what the numbers say. A strong strategy blends experience, risk management, and disciplined execution. Here’s how we encourage investors to evaluate a General Partner’s approach (and how we structure ours at Rampant Lion Capital).


1. How Do You Source Deals?

Great investments begin with great acquisitions.
General Partners (GPs) typically source deals either on-market (publicly listed) or off-market through established broker relationships.

At Rampant Lion Capital, we focus on off-market opportunities. These deals are less competitive, offer room for negotiation, and allow us to acquire quality assets below replacement cost—all of which translate into better purchase terms and stronger projected returns for investors.


2. How Often Do You Communicate With Investors?

Investor communication isn’t an afterthought—it’s a core part of performance management.

We provide monthly performance updates that include:

  • Occupancy rates and leasing trends
  • Renovation progress and rent premium comparisons
  • Capital expenditures and project milestones
  • Market insights and resident engagement highlights
     

Each quarter, we also share key financial statements such as the T-12 and rent roll, giving our investors a clear view of property performance.

In short: you’ll never be left wondering how your investment is doing.


3. Can You Guarantee a Return?

The right answer from any credible sponsor is no.
Returns in multifamily real estate are projected, not promised.

Our underwriting uses conservative assumptions and stress-tested models to account for different market scenarios. While we can’t guarantee outcomes, we can guarantee transparency in how those outcomes are achieved.


4. What’s Your Policy on Reserves?

Reserves are the financial safety net that protect investor capital.
Every well-run multifamily investment should have a contingency fund for unexpected repairs, temporary dips in occupancy, or unforeseen capital expenditures.

We typically allocate $300 per unit per year for reserves and continually build upon that throughout the hold period. These funds ensure we never need to return to investors for emergency capital—and they help maintain operational stability even during market turbulence.


5. How Does the Sponsor Make Money?

Transparency in fee structure matters.
Most GPs earn income through acquisition fees, asset management fees, and equity participation. These fees should be clearly defined in the Private Placement Memorandum (PPM) and directly tied to the value the sponsor provides.

At Rampant Lion Capital, our compensation is performance-aligned—we succeed when our investors do.


6. How Do You Protect Investors From Market Downturns?

There’s no way to predict the market—but there are clear ways to prepare for it.
Our strategy prioritizes resilience over speculation.

Here’s how we protect investor capital through all market cycles:


Experienced Team

Our leadership team has navigated both bull markets and challenging cycles. Experience under pressure builds better decision-making.


Long-Term Debt

We use fixed-rate, long-term debt that aligns with each property’s business plan. This ensures we’re never forced to sell during unfavorable conditions.


Conservative Exit Cap Rates

We always underwrite with a higher cap rate at sale—typically 0.5% above current market rates—to account for potential market softening.


Strong Reserves at Closing

Every acquisition includes a healthy cash buffer at closing, plus monthly contributions to reserves (typically $250–$300 per unit per year).


Value-Add Execution

We target cash-flowing, value-add properties that generate income from day one while also offering upside through renovations and operational improvements.

Cash flow pays the bills. Forced appreciation builds wealth. We do both.
 

7. Matching Debt to the Business Plan

Debt structure should complement—not constrain—the investment strategy.
Short-term bridge loans make sense for repositioning assets, while long-term, fixed-rate loans are better for stabilized holdings.

By aligning the loan term with the property’s value-add timeline, we preserve optionality—allowing us to hold through downturns and sell only when market conditions are right.


8. Conservative Assumptions Drive Sustainable Results

Smart underwriting begins with realism. We base every projection on data, not optimism.

When evaluating a deal, we focus on:

  • Rent Growth: We forecast gradual rent increases, not unrealistic spikes.
  • Vacancy: We assume 10%+ total vacancy for heavy value-add deals to reflect both renovation downtime and economic vacancy.
  • Exit Cap Rate: We assume the exit cap rate will expand, not compress, by the time of sale.
     

Overpromising creates risk. Conservative modeling creates durability.


Final Thought

A well-structured multifamily investment is built on discipline, not luck.
At Rampant Lion Capital, we underwrite conservatively, communicate proactively, and operate with precision—so our investors can participate confidently in every market cycle.


Capital preserved. Income produced. Value created.
That’s how we evaluate every opportunity.


Every investment opportunity tells a story — and it’s your job as an investor to read between the lines. At Rampant Lion Capital, we encourage investors to look beyond surface numbers and ask the right questions before committing capital. Here’s how to properly evaluate a multifamily syndication deal.


1. Why Is the Owner Selling?

There are dozens of reasons an owner may decide to sell, and most of them are completely normal:

  • They’re retiring or rebalancing their portfolio
  • They’re moving into larger, higher-end assets
  • The property has underperformed and they’re ready to hand it off
  • They’ve already added value and want to “flip” the stabilized asset
     

The key takeaway: we care less about the seller’s motivation and more about whether the deal makes sense. If the numbers work and the fundamentals are strong, the reason for selling becomes irrelevant.


2. Is the Property Being Acquired Below Market Value?

Always compare the total cost (purchase price + planned capital expenditures) to comparable properties in the area. If the all-in basis is higher than the comp set, the GP is likely overpaying—and that will erode your returns. At Rampant Lion Capital, we aim to acquire properties below replacement cost and under market value, ensuring built-in equity from day one.


3. What’s the Cap Rate—Now and at Stabilization?

In a value-add deal, the going-in cap rate is less important because the property’s net operating income (NOI) is temporarily depressed.
Instead, focus on the stabilized cap rate and how it compares to the market cap rate.
If the stabilized cap rate is higher than the market average, that means the property will likely create meaningful equity upon execution of the business plan.


4. What Are the Major Risks?

Be wary of any sponsor who says there are “no risks.” Every deal carries some level of uncertainty. A credible operator identifies potential risks—related to the market, operations, or renovation scope—and has clear, proactive plans to mitigate them. We evaluate risk through stress-testing, conservative underwriting, and deep market data analysis to ensure that even in less favorable conditions, your capital remains protected.


5. Have the Major Systems Been Inspected?

Before closing, an experienced GP should personally inspect or commission third-party evaluations of the property’s key systems:

  • Roof
  • Plumbing and electrical
  • HVAC
  • Windows and siding
     

This is essential for building an accurate CapEx budget. Deferred maintenance is part of multifamily investing—but it should never be a surprise.


6. What’s the Projected Hold Period?

Multifamily investments typically have a 5–7 year hold period, though each business plan is different.
Your sponsor should clearly articulate:

  • The expected timeline
  • Whether the exit is via sale or cash-out refinance
  • When you can expect potential liquidity events
     

Transparency about timing is fundamental to managing investor expectations.


7. What’s the Minimum Investment?

Minimums vary based on the project size and the sponsor’s track record.
At Rampant Lion Capital, our minimum investment typically ranges from $75,000–$100,000, ensuring each investor maintains meaningful participation while we manage a focused, quality investor base.


8. How Much Is the Sponsor Investing Personally?

This question often reveals the heart of the partnership. Ideally, GPs should have “skin in the game”—but the reality is nuanced. Many experienced sponsors maintain liquidity instead of tying up large sums of cash in each deal. Here’s why that matters:

  • Liquidity is required to secure future loans and fund earnest money deposits
  • Operators need emergency reserves across their portfolio
  • It allows them to keep pursuing deal flow without being capital constrained
     

The more important question isn’t “how much are they investing personally,” but rather “how well are their interests aligned with yours?”


9. Aligning Interests Between GPs and LPs

At Rampant Lion Capital, alignment drives everything.
Our General Partners (GPs) and Limited Partners (LPs) win together.
That means our fees, equity participation, and incentives are structured to reward performance—not transactions.

Key alignment indicators:

  • GPs earn only when investors earn
  • Equity participation ensures shared upside
  • Transparent communication ensures mutual trust
     

Misalignment occurs when one party profits while the other doesn’t—something we design our deals to avoid entirely. We protect investor interests by structuring compensation that’s fair, transparent, and entirely performance-based.
 

10. Understanding Liquidity and Risk

Liquidity isn’t about greed—it’s about stewardship. A well-capitalized sponsor can absorb unforeseen challenges, fund shortfalls without investor capital calls, and sustain operations during volatile periods. Our policy: keep enough liquidity to protect the deal, preserve cash flow, and maintain confidence.


11. What Type of Offering Is It—506(b) or 506(c)?

The SEC regulates how private real estate offerings are shared with investors:

  • 506(b): Cannot be publicly advertised; allows up to 35 non-accredited investors with a pre-existing relationship.
  • 506(c): May be advertised publicly but is open only to accredited investors, whose status must be verified by a third party (CPA, attorney, or verification service).
     

Rampant Lion Capital primarily operates under Reg D 506(b), fostering long-term relationships with qualified investors.


12. How Was the CapEx Budget Created?

Every dollar of renovation spending matters. Ask whether the sponsor’s CapEx budget is based on actual contractor bids or estimates from spreadsheets. Our budgets are built from detailed, on-site evaluations and verified bids—and always include a 10–20% contingency to manage unforeseen costs.


13. How Are Taxes Being Calculated?

The property’s new purchase price (not the seller’s tax basis) should form the basis for property tax assumptions. We verify every local tax rate through county data to ensure realistic projections.


14. What’s the Debt Structure?

Debt defines flexibility. Ask:

  • Is the financing short-term or long-term?
  • Is the interest rate fixed or variable?
  • Has the rate been locked in?
     

Rampant Lion Capital typically uses long-term, fixed-rate debt that aligns with the project’s hold period and business plan, ensuring stability through all market cycles.


15. What Are the Exit Assumptions?

In value-add and distressed deals, much of your return is realized at the sale or refinance.
That’s why you should always understand:

  • The projected exit NOI
  • The assumed exit cap rate
  • Expected closing costs and remaining debt
     

We underwrite every deal assuming a 0.50% higher cap rate at exit—a conservative approach that cushions returns if the market softens and creates upside if conditions remain strong.


16. The Rampant Lion Capital Standard

When we evaluate a potential acquisition, we ask one question above all others:

“Would we invest our own family’s capital in this deal?”
If the answer isn’t an emphatic yes, we don’t move forward.

Our process is guided by three non-negotiables:

  • Integrity in every assumption
  • Discipline in every decision
  • Alignment in every partnership
     

That’s how we protect investor capital, build resilient portfolios, and deliver sustainable long-term results.


Understanding the fundamentals of multifamily finance helps you evaluate opportunities with confidence. Here are the core terms every investor should know — explained in plain language, the way we use them every day at Rampant Lion Capital.


Net Operating Income (NOI)

Net Operating Income represents the property’s total income minus all operating expenses—before accounting for capital expenditures or loan payments.
In short, it’s the true profitability of the property’s operations.


Formula:
NOI = Gross Income – Operating Expenses


This number is foundational. It’s what drives the property’s valuation and determines how much debt it can responsibly support.


Capital Expenditures (CapEx)

CapEx refers to the big-ticket improvements made to a property—those that extend its life or increase its value. Examples include replacing a roof, resurfacing a parking lot, or upgrading kitchens and bathrooms. At Rampant Lion Capital, we carefully budget CapEx to improve both resident experience and long-term performance, not just aesthetics.


Debt Service

Debt Service is the annual amount paid to a lender for the property’s mortgage—covering both principal and interest. When we evaluate deals, we compare NOI to debt service to ensure the property easily covers its loan obligations, a key indicator of financial stability.


Capitalization Rate (Cap Rate)

The Cap Rate is a measure of expected return based on a property’s current income. It’s calculated by dividing the property’s NOI by its purchase price or market value.


Formula:
Cap Rate = NOI ÷ Property Value


Cap rates move inversely with value: lower cap rates generally mean higher prices, while higher cap rates typically indicate better returns—but also potentially higher risk.


Average Annual Return (AAR)

Average Annual Return shows how much your investment earns on average each year, combining both cash flow and profit from the sale.


Example:
If a $100,000 investment produces $75,000 in total profit over 5 years, your AAR is:
$75,000 ÷ $100,000 ÷ 5 = 15%


It’s a straightforward way to see how your capital performed over time.


Internal Rate of Return (IRR)

The Internal Rate of Return measures the total profitability of an investment while accounting for the time value of money—recognizing that dollars received today are worth more than those received years from now.


IRR factors in:

  • All future cash flow distributions
  • Principal paydown
  • Refinance or sale proceeds
     

While IRR is the most precise comparison tool between investments, we often pair it with AAR for a more intuitive understanding.


Cash-on-Cash Return (CoC)

Cash-on-Cash Return measures your annual cash flow relative to your invested capital.


Example:

If you invest $100,000 and receive $10,000 in distributions in a year, your CoC return is 10%. It’s a simple, real-world measure of how hard your money is working in the short term.


Preferred Return (“Pref”)

A Preferred Return ensures that Limited Partners (LPs) receive a set minimum return before General Partners (GPs) participate in profits. For example, if the preferred return is 8%, LPs earn that amount first—aligning incentives so GPs perform to deliver beyond that hurdle.


Distributions

Distributions are how investors receive their share of profits.
They can occur:

  • Monthly or quarterly (from property cash flow)
  • At refinance (from returned equity)
  • At sale (final profit participation)
     

At Rampant Lion Capital, we prioritize consistent, predictable distributions and clear reporting so investors always know when and how they’re being paid.


Final Thought

Knowing these terms helps you look at deals the way a sponsor does—objectively, strategically, and confidently. At Rampant Lion Capital, we’re committed to helping every investor understand not just what they’re investing in, but why it works.


In a multifamily syndication, the sponsor (or General Partner) earns compensation for finding, acquiring, and managing the investment. These fees help cover operational costs and ensure the sponsor team has the resources to execute the business plan effectively.

At Rampant Lion Capital, we believe in complete transparency around fees and incentives — and we structure them so that our success is tied directly to yours.


How Sponsors Get Paid

Every syndication includes some combination of standard fees. Here’s how they work:

Acquisition Fee (2–5%)

Paid at closing, this fee compensates the sponsor for sourcing, negotiating, underwriting, and closing the deal, and is typically based on the deal size.


Asset Management Fee (≈1.5%)

Covers the ongoing management and oversight of the property — including financial reporting, capital planning, and investor communications.


Disposition Fee (≈1%)

Charged only when the property is sold, this fee covers the work involved in preparing and executing the exit strategy.


At Rampant Lion Capital, we keep fees fair, reasonable, and fully disclosed.
Our team doesn’t rely on fees for profit — our upside comes from performance-based equity when we execute our plan, increase property value, and deliver strong returns for investors.

Our philosophy: if the property performs, everyone wins.
 

When Investors Receive Their Capital Back

Passive investors (Limited Partners) typically receive their original capital back through one of two liquidity events:


1. Refinance

Once renovations are complete and income has increased, the property can often be refinanced based on its new, higher valuation.
This allows investors to receive a partial or full return of their original investment — often tax-free, since it’s structured as a loan return rather than income.


2. Sale

When the business plan is fully executed and the property has achieved target performance, it’s sold. At that time, investors receive their remaining principal plus their share of profits.


Example

We acquired a 321-unit multifamily community for $7 million, invested $1 million in strategic improvements, and refinanced just 13 months later at a $15 million valuation.

Investors received 84% of their original capital back while continuing to earn returns on the full invested amount — a prime example of how thoughtful execution and disciplined management can accelerate equity growth.


Our Commitment to Alignment

We view every investor relationship as a long-term partnership. That’s why Rampant Lion Capital structures every deal to ensure our incentives are aligned with yours — we only succeed when you do. Transparent fees. Disciplined execution. Shared success.


This is the most important point few multifamily syndicators are going to discuss. This is NOT for everyone. If a syndicator isn't asking you questions about your finances, explaining the process to you, or communicating with you along the way - you should have serious questions of their motives and 


Multifamily syndications can be a powerful tool for building long-term wealth — but they’re not for everyone. Here are a few cases where this type of investment might not be the right fit:


  1. If You Need Short-Term Liquidity (MOST IMPORTANT)
    Syndications are long-term, illiquid investments. Capital is      typically tied up for 5–7 years, and early exits aren’t an option. If you’ll need access to your funds in the near future, this probably isn’t the right vehicle.
  2. If You’re Uncomfortable with Market Risk
    Real estate carries exposure to changing market conditions, interest rates, and operating performance. Returns aren’t guaranteed — they’re projections based on business plans and assumptions. If you prefer guaranteed returns or fixed income, a syndication may feel too uncertain.
  3. If You Want Control Over Management Decisions
    As a Limited Partner, you’re a passive investor. You won’t be making day-to-day decisions about operations, renovations, or financing. If you prefer direct control over your properties, you might be better suited for active real estate ownership.
  4. If You’re Investing Borrowed Money
    These investments work best when funded with patient capital, not borrowed funds or essential savings. Using leverage or tapping into funds needed for living expenses can create unnecessary financial pressure.
  5. If You Haven’t Built a Strong Financial Foundation Yet
    Syndications make sense once you’ve built cash reserves, paid off high-interest debt, and have a clear understanding of your investment goals. If you’re still working toward those steps, it’s worth waiting until your foundation is stronger.

  

In Short

Multifamily syndications are for investors who value long-term, passive wealth creation over quick liquidity or control. If you’re comfortable with risk, patient with capital, and seeking a hands-off way to grow wealth through real assets — it can be an excellent fit.


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