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How It Works

Passive Investing

When you invest passively through real estate syndications (group investments), you don’t have to deal with any tenants, toilets, or termites. You get all the benefits of investing in real estate (cash flow, equity, and tax benefits) without the time commitments needed to be a landlord.

Follow our four step process described below, and start making a positive change in your life today.

 
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Apply

Join the Cobiant Investor Network

 Apply to join our FREE investor network.

As a member we will help you:

  • Define the level of monthly income required for you to live a lifestyle that works for you and your family; some refer to this as your “rat race” number.

  • Define your minimum requirements for a comfortable retirement.

  • Determine what it will take for you to reach your cash flow and retirement goals.

  • Work with you to make it happen!

Additionally, FREE personal agility coaching is available for all of our members.

Download our FREE eBook to learn more.  

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Connect

Connect With Us

After you have been accepted as a member of our network you will receive a welcome email that will include a link to setup a call with our Director of Investor Relations. He will personally welcome you to our family, brief you on our process, answer questions and serve as your single point of contact going forward. After, you will begin to receive regular updates from us via email. If you ever have additional questions or concerns, you are always welcome to setup a call with us via your provided link.

Once we have both decided that investing together is a good fit, we will begin to share our passive investing opportunities with you. You can then freely pick and choose which, if any, you would like to invest in as well as the amount. We want you to feel comfortable with the entire process and will work with you to make the right decision on the investment opportunities that are the best fit for you. After you invest with us, we will partner together for years, so it important that we really get to know each another on the front end. We are highly dedicated to building a strong, trustworthy relationship with each of our investors.

Download our FREE eBook to learn more.

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Invest

Invest With Us

Once you become a member of our investor network you will have the opportunity to invest alongside us. Typically, the minimum investment is $50,000. Therefore, you can invest any amount at or above $50,000, usually in increments of $5,000.

Did you know that you can invest in real estate syndications with money that is in your 401(k)? You would need to first roll those funds over into what is known as a self-directed IRA account. Setting up a self-directed IRA is pretty straight forward.

Our process is probably best described by using an example. Let’s say we have found an amazing investment opportunity, have done a great job negotiating with the seller and they are willing to sell their apartment complex for $8,000,000. We need $2,000,000 for the down payment and $1,000,000 for renovations to improve the property. All together we need $3,000,000.

We, the sponsor team, decide to form a syndication and bring the opportunity to our investors. We put $50,000 into the deal, you put in $100,000, another investor puts in $75,000 and so forth and so on until we reach $3,000,000. Everyone that puts money into the deal would be the passive investors. We, the sponsor team, would be the active investors because we will continue to have an active role in managing the project. In this example, since we also put money into the deal, we would not only be active investors (as the sponsor team) but also passive investors just like you. Another bonus, because the loan is well over a million dollars, we were able to secure a non-recourse loan. By the way, we typically secure non-recourse loans for our syndications.

The sponsor team will then work with our attorney to create an LLC. You and the other passive investors, along with the members of the sponsor team, will all join the newly created LLC. The sponsor team members will be listed as General Partners while the Passive Investors would be included as Limited Partners for the LLC.

Additionally, the sponsor team will engage a syndication attorney to create a private placement memorandum that defines how the investors are tied to the investment, the risks involved, etc.

Because the LLC is a pass-through entity you will get the benefits of direct ownership in the real estate asset. This is far superior to investing in a Real Estate Investment Trust (REIT). When you put money into a REIT you don’t have any ownership in a property whatsoever. Investing in a syndication has nothing to do with REITs; that is a source of confusion for some.

After we close on the deal it will be the responsibility of the sponsor team (i.e. our Asset Manager) to work with the Property Manager, as well as the renovation team, to manage and improve the property. You as a passive investor don’t have to deal with any of the hassles of being a landlord. You simply cash checks.

Download our FREE eBook to learn more.

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Collect

Collect Distributions

As a passive investor you will collect regular cash flow distributions while also building for retirement. What kind of returns can you expect? Well as you can imagine, they will vary based on the particular investment opportunity.

Let’s use an example to provide a general benchmark as to what you can expect. Assume you have decided to invest $100,000 in a real estate syndication to purchase an apartment complex with:

  • a projected 5-year hold

  • annual cash flow returns of 10 percent

  • a 2.2X equity multiple

  • average annual return of 24%

​With a projected annual cash flow of 10 percent, you should expect to get 10 percent of your original investment back each year. That means you would receive $10,000/year or about $833/month. Over the 5-year period that comes out to $50,000 in total cash flow returns.

Then there is profit from the sale of the property in year five. With an equity multiple of 2.2X you are projected to more than double your investment (220 percent to be exact) over the course of the 5-year hold time (i.e. when you add up the cash flow plus the profit from the sale).

Therefore, by the end of the 5-year hold period you would have received your original $100,000 back, plus $50,000 in cash flow during that time, plus $70,000 in profits from the sale of the property for a total of $120,000 in profit. Your original $100,000 would have turned into $220,000 over the course of 5 years. Another way to look at it would be to take your $120,000 in profit and divide it by the 5-year holding period giving you $24,000/year or an average yearly return of 24%.

The regular cash flow can serve to support you or at least augment your monthly income from your current job as you transition to your new career. With enough investments you could choose to completely step away from your old career. Finally, the $70,000 you receive at disposition can be reinvested into your retirement portfolio, whether into another syndication, stocks, bonds or other.

Download our FREE eBook to learn more.

Be sure to download our FREE eBook to learn more about how to passively invest through real estate syndications.

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Personal Agility

Frequently Asked Questions

What is a passive investor? What is a real estate syndication?


Passive investing is an investment strategy that seeks to maximize returns while minimizing buying and selling. It usually refers broadly to a buy-and-hold portfolio strategy for long-term investment horizons. A real estate syndication is essentially a group real estate investment. Think of a real estate syndication as a plane ride and we, as the sponsor, are the pilot. The sponsor deals with the day-to-day operations of the property. Cobiant Capital is also the travel agent, helping people find the right flights and determine their destinations. As a passive investor, you are the passenger. You choose the flight, buy the ticket and enjoy the ride. You simply invest your money, then sit back and start receiving returns. You never have to worry about dealing with tenants. As the sponsor (i.e. operator) we take care of managing the property, dealing with daily issues and provide you with regular updates.




What is an accredited investor? Do I need to be one?


The Securities and Exchange Commission (SEC) sets restrictions on whom can and cannot invest in various opportunities. They do this to reduce the risk for those that may not be as knowledgeable about investing in general. The SEC declares an accredited investor as one that meets one or more of the following criteria:

  • Individual income has been $200,000 or more in the past two years and has reasonable expectation of reaching the same income level this year.
  • Joint income with their spouse has been $300,000 or more in the past two years and they have reasonable expectation of reaching the same income level this year.
  • Individual net worth (or joint net worth with spouse) exceeds $1,000,000, excluding their primary residence.
  • Has a Series 7, 65 or 82 securities license or another verifiable professional credential that qualifies them as an accredited investor.
Being an accredited investor opens the door to invest in certain syndications that sophisticated (non-accredited) investors cannot. Most of our investments are only available to accredited investors, but we do sometimes offer investments for others.




What is Cobiant Capital's investment strategy?


We both actively and passively invest in Class B and Class C value-add multifamily residential syndications. Depending on the particular investment opportunity, our business model follows a buy-and-hold or buy-and-watch strategy. As the sponsor team, we partner with accredited and sophisticated investors that passively invest in our real estate syndications.




What is a sophisticated investor?


The Securities and Exchange Commission (SEC) declares a sophisticated investor (non-accredited investor) as one that has enough knowledge and experience in business matters to evaluate the risks and merits of an investment.




How long will my investment be tied up in a syndication?


If you decide to invest in a Real Estate Syndication, understand they almost always follow a long-term investment strategy; usually five to ten years. So, let’s say you invest in a syndication that has a projected hold time of five years. Once you invest your money you can expect regular cash on cash returns, but you should not expect to see that initial investment again until the property is sold. Yes, there could be a refinance opportunity sometime before disposition and you could get most if not all of your initial investment back at that time, but you shouldn’t count on it. So, this makes real estate syndications different than stocks and bonds for example, which are much more liquid investments.

That being said, we know that five to ten years can be a long time and life happens. If you have a major life event and need out, we will do everything in our power to help you get out of the investment, including buying out your shares ourselves if need be.




What returns should I expect on my investment?


While exact percentages will vary from one investment to the next, you will receive the same types of returns across the board. Cash on cash returns are paid throughout the lifecycle of each investment. You will also receive a portion of the profits from the sale of the asset at the end of the project.




What are the risks?


Commercial real estate assets like apartment buildings operate independently of the stock market. In fact, they tend to fare better in recessions, because more people tend to downsize. They also tend to be safer investments than single family homes because if one tenant moves out, you still have the others to pay down the loan.





Build true wealth as a passive investor

Are you ready to build true wealth and start living your best life? There's no better and more reliable way to do it than to invest passively in real estate syndications.

To start your investing journey, apply to join the Cobiant Investor Network.

Download Our FREE eBook

"Life On YOUR Terms"

Busy professionals that feel you've missed your true calling as an artist, creative or entrepreneur...

it's your time! Learn how to leverage proven principles that can help you TODAY on your journey to a better life. Create passive cash flow, build for retirement and get amazing tax breaks by passively investing in multifamily real estate while pursuing your true purpose in life. 

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