The episode delves into the risks associated with leveraging bonus depreciation, emphasizing that while it can accelerate tax benefits, it may result in a hefty recapture tax if the investment does not pan out. The host highlights that bonus depreciation, much like leverage, is a double-edged sword, requiring prudent management to avoid pitfalls.

Links referenced in this episode:

• scholasticcapital.com

Companies mentioned in this episode:

• Scholastic Capital

Understanding the K1 timeline is crucial for real estate investors, as it can serve as a proxy for the quality of a fund. A timely delivery of K1 forms can indicate a fund's operational efficiency, while delays might raise red flags about their accounting practices. The episode highlights the importance for General Partners (GPs) to prioritize prompt K1 distribution to reassure investors.

Links referenced in this episode:

• scholasticcapital.com

Companies mentioned in this episode:

• McKinsey
• Deloitte
• Mercedes
• Hyundai
• Scholastic Capital

Having a fund administrator is essential for any real estate fund, especially those that are sub-institutional. In this episode, the host emphasizes that relying on in-house calculations or software solutions to manage fund distributions can lead to conflicts of interest and potential biases. While it may seem like a cost-saving measure to cut out fund administration, the host argues that this is a mistake that can undermine trust and integrity within the fund.

Links referenced in this episode:

• scholasticcapital.com

Companies mentioned in this episode:

• Scholastic Capital
• Juniper Square
• AppFolio IM

One of the key insights from this episode is how the Ricketts family transformed Wrigleyville by strategically controlling their own rental comps after purchasing the Chicago Cubs. As they developed multiple properties, they effectively set the market rate, demonstrating that controlling the majority of comps can significantly influence rental prices. This fascinating real estate strategy offers valuable lessons for investors looking to create demand and reshape markets.

Links referenced in this episode:

• scholasticcapital.com

Companies mentioned in this episode:

• Chicago Cubs
• Scholastic Capital

Today's episode delves into the compelling case for investing as a limited partner (LP) in real estate, particularly in the highly competitive multifamily sector. While building your own portfolio can be appealing, the reality is that competing against major players like Blackstone can be daunting for individual investors who have full-time jobs. By leveraging the expertise of a responsible and dedicated general partner, individual investors can more effectively participate in lucrative deals without the overwhelming pressure of direct competition.

Links referenced in this episode:

• ScholasticCapital

Companies mentioned in this episode:

• Coke
• Pepsi
• Blackstone
• Scholastic Capital

This episode emphasizes an often-overlooked aspect: the enjoyment derived from the journey of real estate investing. For many successful investors, the fun of touring homes, managing properties, and overseeing renovations is a primary motivator. If you find yourself scrolling through real estate listings for pleasure, it might indicate that pursuing your own portfolio could be the more fulfilling path for you.

Links referenced in this episode:

• scholasticcapital.com

Companies mentioned in this episode:

• Scholastic Capital

The simplest and most effective due diligence step for both general partners (GPs) and limited partners (LPs) in real estate investing is to contact the police about a property. This insightful tip is shared through a personal story that highlights the importance of understanding a property's neighborhood dynamics. The police have firsthand knowledge of any issues affecting a property, which can provide valuable insight beyond standard financial reports. By prioritizing this step in due diligence, investors can potentially avoid costly mistakes and make more informed decisions.

Links referenced in this episode:

• scholasticcapital.com

Companies mentioned in this episode:

• Scholastic Capital

This episode explores a critical aspect of real estate investing: the preferred return and promote structure, vital for defining the economic relationship between LPs and GPs. The host presents two distinct frameworks: the traditional 8% preferred return model and the 90/10 forever model, which operates without a preferred return. Listeners are encouraged to consider their own investment philosophies and the implications of each structure, emphasizing that understanding these terms is crucial for fostering productive partnerships in real estate.

Links referenced in this episode:

• scholasticcapital.com

Companies mentioned in this episode:

• Scholastic Capital

Understanding the key operational metrics in real estate is essential for success, especially as your portfolio grows. Many investors focus on basic financial calculations, but the true differentiator lies in knowing your numbers like a business operator would. This episode emphasizes the importance of tracking specific metrics, such as maintenance call-out rates and average turn times, which can significantly impact tenant retention and net operating income. By diving deep into these operational details, real estate operators can enhance their decision-making and overall performance.

Links referenced in this episode:

• scholasticcapital.com

Companies mentioned in this episode:

• Scholastic Capital

This episode emphasizes how this approach can enhance decision-making by reverse engineering the desired outcomes, particularly focusing on the successful sale of a property. By identifying who is likely to buy the property and what they value, investors can better tailor their strategies and business plans. A nuanced approach to underwriting coupled with thoughtful planning can lead to more favorable exit opportunities.

Links referenced in this episode:

• scholasticcapital.com

Companies mentioned in this episode:

• Scholastic Capital