Real estate syndication, or how to make money in real estate without repairing a roof;

              REALESTA.
ND CATIOK
or how to make money
in real estate
without repairing a roof
by John A. McGuire
Once prominent in the idiom of the underworld, the
word "syndicate" has in the last few years moved up to
become almost as important to the vocabulary of the
business and professional man.
"Syndicate" has made the step up to respectability
because investors, as well as entrepreneurs, have seen
advantages in real estate syndication to their mutual
benefit. They have made real estate syndication one of
the most prominent methods of marketing medium-sized
and large projects.
The benefits to the investor of a syndicate are easily
perceived. Real estate syndication allows the investor
to take advantage of opportunities in the real estate mar­ket
and gives him a piece of the action in a bigger deal
than he could afford alone. Further, with greater capital
available to the syndicate, there is more likelihood of a
favorable purchase. Syndication allows the professional
man to enter the real estate market without assuming
the daily burden of tenants; the management problems
are handled by the general partner.
Syndication is particularly attractive to an investor in
a high tax bracket since losses from the project—gen­erated
primarily by depreciation—are available as tax
deductions. At the same time the investment will prob­ably
appreciate, possibly at a greater rate than if the
funds had been invested in the stock market. While the
tax losses will reduce ordinary income, the greater por­tion—
or all, if the property is held 10 years—of any sub­sequent
gain upon sale of the property will be treated
as capital gain.
35