Passive Investors – This is How To Oversee Your Investments


If you just invested in multifamily properties through a syndicator, it could be easy to think that someone else is taking care of all the hard work. But don’t prop your feet up and relax just yet. Just because you chose to become a passive investor doesn’t mean you should stay 100% passive. Your investment will still need some attention; there are still reports to look over, calls to make and, of course, checks to deposit. You are a sophisticated investor, so there are many things to be doing to ensure your investments are performing up to your expectations, even though you are technically passive. Here are some tips to help you manage your passive investment.

Educate Yourself

As an investor, the most important thing for successful ventures is to educate yourself. Find out everything you can about multifamily investing. Learn how property value is determined and how returns are calculated. It may seem like you are trying to learn a whole new language at first, but with some patience, persistence and practice, it will soon become second nature. If you are truly serious about becoming a successful passive investor, building a strong foundation is paramount and that comes from seeking out information.


Attend Syndicator Meetings

Attend all hosted calls and meetings. People on the front line will tell you about the behavior of your assets. Listen to them. Make note of any upcoming capital events such as sales or refinancing so you can project when your capital returns are likely to occur. This helps you prepare for reallocating funds into your next investments. Also take note of projected expectations of future cash flow This can be beneficial for managing the present and the future. If you cannot attend a meeting, just make sure to follow up with a call or e-mail.

Review Each Report

Review each monthly or quarterly report. Review reports with each offering to be sure you have a good understanding of what is going on with the property. First, take a look at the management summary, the month-over-month P&L (profit and loss) statement, monthly detailed profit and loss statement, and cash flow statement. You will also want to take a look at the occupancy reports. Taking a good look at the metrics lets you see how the actual performance is stacking up with the projections. These different reports can assist you in gauging how healthy your investments are. A good syndicator will send you periodically reports, and some even hold quarterly or semi-annually investor meetings, where they give investors an update about the property and allow them to ask questions. Attend those meetings, or at least ask for the recording, so you can better educate yourself about the investment’s progress.


Track Capital Behavior

Check your capital behavior. You need to know how your capital is working on your behalf. You should calculate your ROI regularly. Take everything into consideration like internal costs, especially if you leveraged other assets to create the capital for the investment. Track your returns so you will know your investments are performing as expected. By comparing investments amongst themselves you can determine which opportunities are best.


Ask Questions

Ask questions. Understanding your investment opportunity is essential to success. If something doesn’t make sense, ask your syndicator. Don't wait for the syndicator period calls. Relationships are integral to successful passive investments. Don’t be afraid to reach out for clarification when needed.


Stay with It

Stick with your routine. It is all too easy to skip a month or a quarter and get out of the routine. Use your calendar to schedule check-ins and treat reviewing investments as a priority. At first, it may seem time-consuming, but the tasks get quicker and easier over time. Use these tasks and time to fuel your own passion. Think about it as steps for building your own wealth and increasing your value. It’s also a great opportunity to engage your family in the learning process.

Even though overseeing passive investments takes a minimal amount of work, it’s still much easier than taking on the active role and it still requires a commitment on your part. By being dedicated to overseeing your investments, you will soon understand the dealings much better and be able to quickly recognize the areas your capital is producing the greatest results on your behalf.


To get your FREE copy of The Ultimate Guide For The Passive Investor, visit www.ellieperlman.com


About the author

Ellie is the founder of Blue Lake Capital, a real estate company specializes is multifamily investing throughout the United States. She is also the host of a weekly podcast called "That REllie Happened?! Unbelievable Real Estate Stories with Ellie", a podcast that brings the true stories behind the deals, from the most successful real estate investors around the globe. Ellie started her career as a commercial real estate lawyer, leading real estate transactions for one of Israel’s leading development companies. Later, as a property manager for Israel’s largest energy company, she oversaw properties worth over $100,000,000. Additionally, Ellie is an experienced entrepreneur who helped build and scale companies by improving their business operations. She holds a Masters in Law from Bar-Ilan University in Israel and an MBA from MIT Sloan School of Management.

You can read more about Blue Lake Capital at www.bluelake-capital.com and learn more about Ellie at www.ellieperlman.com

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