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Concepts

November 5, 2024

7 min read

Why a Distribution May Be Classified as Return of Capital (and Why That’s a Good Thing)

Have you ever received a distribution from a real estate fund or syndication...

Let’s start by clarifying the difference between cash flow and taxable income. In real estate funds, cash flow represents actual cash generated from sources like rental income or lending activities, but taxable income is often much lower than cash flow because of non-cash deductions—especially depreciation.

Depreciation is a valuable tax tool in real estate. It allows funds to deduct the “wear and tear” on assets from their taxable income without reducing actual cash flow. The result? Funds often have much more cash to distribute than taxable income to report.

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February 6, 2024

7 min read

Financial Analysis in Multifamily Syndication

In multifamily syndication, where investors pool their resources to invest in...

In multifamily syndication, where investors pool their resources to invest in apartment complexes or similar properties, mastering financial analysis is not just a skill but a necessity. This analysis forms the backbone of informed decision-making, guiding investors through the complexities of profitability, stability, and investment viability. Let's delve into the intricacies of financial analysis in real estate, exploring its purpose, key components, and crucial role in strategic decision-making.

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