Empowering Commercial Real Estate Investors
Passive Income. Long-Term Wealth. Trusted Guidance.
Free to Join – Learn, Connect, Invest at Your Own Pace
STILL NOT SURE?
Frequently Asked Questions
Real Estate Syndication Basics
What is real estate syndication?
Real estate syndication is a partnership where multiple investors pool their funds to buy large commercial properties. Afterburner Equity manages everything, and you receive passive income.
Who is the sponsor?
The sponsors, or General Partners, like Afterburner Equity, are the group that finds the deal, handles financing, oversees operations, and communicates with investors.
What is an LP?
An LP, or limited partner, is a passive investor who contributes capital but doesn’t manage the deal. You earn income without day-to-day responsibilities.
Is real estate syndication legal?
Yes, syndications are legal and regulated by the SEC. Our offerings comply with exemptions like Regulation D 506(b) or 506(c).
Is this like crowdfunding?
It’s similar, but more targeted. You’re investing directly with a sponsor in a specific deal — not through a platform with many projects.
Do I own part of the building?
Yes, indirectly. You own shares in the LLC that owns the property. That LLC is the legal owner.
How is this different from a REIT?
REITs are public stocks with low returns and limited control. Syndications are private, targeted, and offer better tax benefits and higher upside.
How do I get started?
Join our investor list, review deals, sign documents, and fund your investment. We guide you each step of the way.
What kind of properties do you invest in?
Afterburner Equity invests in multifamily, industrial, office, and mixed-use commercial properties in high-growth markets.
How long is the typical investment?
Most of our deals last 3–7 years, depending on the strategy. You earn returns along the way, and a large payout at sale.
Investment Process
How do I review a deal?
We’ll send you a full investment summary — projections, financials, business plan, and property images.
What documents do I sign?
You'll sign a Subscription Agreement, Private Placement Memorandum (PPM) , and Operating Agreement (OA).
How do I fund the investment?
Usually via wire transfer or IRA/401k custodian. Full instructions are included when you commit.
What happens after I invest?
You’ll get a confirmation, receive investor updates, and start earning passive income.
Who manages the property?
A vetted professional property manager under our oversight.
How do I get updates?
Quarterly — financials, occupancy, and key highlights. In some cases, monthly.
Can I visit the property?
Yes, we offer site visits and virtual walkthroughs on request.
What’s the timeline after I fund?
Typically, first distributions start 60–90 days after funding.
Do you offer repeat investment opportunities?
Yes — many of our investors reinvest in each deal.
Is there a deadline to invest?
Yes — deals fill quickly. Once we reach capacity, we close funding.
Returns & Performance
What returns can I expect?
Typical returns range from 12%–18% total annual return including cash flow and appreciation.
What is a preferred return?
It's the first portion of profit (often 7–8%) that goes to passive investors before the sponsor earns anything.
Are returns guaranteed?
No — all investments carry risk, but we underwrite conservatively.
How are returns split?
Commonly 70/30 or 80/20 between LPs and GPs, after preferred return.
What is IRR?
Internal Rate of Return — a calculation of annualized return including time value of money.
What is equity multiple?
It shows how much your money grew. For example, a 2.0x multiple means your $50k became $100k.
When do I receive returns?
Quarterly distributions once the property stabilizes.
How are profits distributed at sale?
First, your capital is returned, then preferred return catch-up, then split profit.
Can returns increase over time?
Yes — as rent increases and expenses stabilize, cash flow can improve.
What affects returns the most?
Occupancy, rent growth, market performance, and exit cap rate.
What happens if returns are lower than expected?
The sponsor and GP team take the hit first.
Do you provide projections?
Yes, each deal includes conservative 5–10 year financial models.
Can I reinvest returns?
Not in the same deal, but yes in future offerings.
Is there a waterfall structure?
Yes, we use a waterfall to prioritize investor returns.
What is a capital event?
A refinance or sale that returns your original investment.
Risk & Safety
What are the main risks?
Market downturn, tenant vacancy, interest rate hikes, or property mismanagement.
How does Afterburner manage risk?
We buy in strong markets, underwrite conservatively, and use experienced operators.
Can I lose my entire investment?
It's possible in extreme scenarios, but rare with commercial assets.
Is the investment secured?
Yes, the LLC owns the property, and you own shares in that LLC.
What happens in a downturn?
We prioritize cash flow and may delay sale for better market timing.
How is leverage (debt) used?
Carefully — usually 60–70% loan-to-value to reduce risk.
Is there insurance on the property?
Yes, full coverage for fire, liability, loss of rent, and more.
What if the sponsor defaults?
The LLC operating agreement outlines investor protections and voting rights.
Do you have a contingency fund?
Yes, each deal includes reserves for unexpected expenses.
Can I diversify across deals?
Absolutely — many investors spread capital across multiple offerings.
Legal & Structure
What is a PPM?
A Private Placement Memorandum outlines the investment risks and terms.
What’s the minimum investment?
Typically $50,000, but it may vary by deal.
Do I need to be accredited?
Yes for 506(c) deals. For 506(b), we accept a limited number of sophisticated investors.
What is accreditation?
$200k+ income (or $300k joint) or $1M+ net worth excluding your home.
How is the deal structured legally?
Investors become members of an LLC that owns the property.
Do I get voting rights?
Usually not — this is a passive investment.
Can I invest through an entity?
Yes, including LLCs, trusts, or retirement accounts.
Is there a holding period?
Yes — typically 3–7 years depending on the business plan.
Who prepares legal documents?
Our securities attorney drafts all investor documents.
Is the LLC registered in a specific state?
Yes, usually Delaware, Wyoming, or the state where the property is located.
Taxes & Reporting
Will I receive a K-1?
Yes, for your share of profits/losses.
When are K-1s delivered?
Usually by March 31 each year.
Are distributions taxed?
Often not initially — you may receive tax-deferred income through depreciation.
Can I use depreciation to reduce taxes?
Yes, real estate has significant depreciation benefits.
What if there’s a tax loss?
You may be able to offset gains in other passive investments.
Do you do a cost segregation study?
Yes, to accelerate depreciation and improve early-year returns.
Are capital gains taxed when the property sells?
Yes, but at favorable long-term capital gains rates.
Can I do a 1031 exchange?
Not from a syndicated deal directly — but the sponsor may use one at the asset level.
Do I need a CPA?
It’s recommended, especially if you're investing through an entity or retirement account.
Will I owe taxes in another state?
Possibly — check with your tax advisor if the property is in a different state.
Common Questions
Why haven’t I heard of this before?
These deals are private and not advertised publicly unless using a 506(c) structure.
How is this different than buying a rental myself?
You skip the toilets, tenants, and time — and earn truly passive income.
Is now a good time to invest?
Commercial real estate is a long-term strategy that performs well through cycles.
Why should I trust Afterburner Equity?
Strong track record, conservative strategy, clear communication, and alignment of interests.
What if I’m not ready to invest now?
No pressure — join our list, learn, and invest when the time is right.
Do I need to vet each deal?
We recommend it — but we handle all due diligence, underwriting, and management.
Can I bring my financial advisor in?
Of course — we welcome third-party reviews.
What fees are involved?
Asset management, acquisition, and potentially a performance split — always disclosed upfront.
Do I need to manage anything?
Nothing at all. We handle everything after your initial commitment.
How do I stay updated on new deals?
Join our Investor Club and follow us on social media or schedule a quick call to connect.
Free to Join – Learn, Connect, Invest at Your Own Pace
© Copyright Afterburner Equity 2025. All rights reserved.
Accelerating Commercial Real Estate Wealth