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Real Estate Investing for Dentists

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Real estate investing is a good option for anyone who wants to make their money work for them. This also applies to people in the dental industry. Dentists who invest in real estate can potentially create a new revenue stream, grow their net worth, and enjoy a tax shelter.

Considering that real estate can offer numerous tax advantages, real estate targets to be one of the best forms of investment for dentists. It should allow you to generate passive income.

It can even give dentists some peace of mind in terms of job security because they no longer have to worry about the number of clients coming through the door. This also relieves some of their stress and allows them to focus on doing their job. They can just worry about their dental practice, their clinic, their patients, and nothing else.

So, for dentists who are considering real estate investing, this is meant to serve as a guide for one particular type of investment that you should know about: multifamily syndication. Here we will discuss what it is and how it works, including its benefits for those in the dental industry.

Make no mistake: there are other traditional methods you can consider such as investing in the stock market. But since dentists are busy professionals, multifamily syndication may be a better fit overall. With all investment opportunities, you should consult your CPA for your specific situation. 

Multifamily Real Estate Syndication for Dentists

Syndication is when a group of investors pool their money in order to purchase a real estate property. Multifamily syndication refers to a group of investors who pool their money to buy a single multifamily asset, such as an apartment complex. [1]

Since dentists are usually busy in the dental clinic working on their patients, they don’t have the time to actively get involved in real estate. They are not necessarily looking for another job. They are too busy to handle the responsibilities of being a landlord, which comes with owning a rental property. With syndication, this is no longer a problem.

For dentists investing in real estate, the primary goal is to have their money work for them without having to exert as much effort as they are already putting into their day job. This can be tricky unless you can find a passive investment to put your money into.

Not only is multifamily syndication a passive type of real estate investment, but it also allows investors to purchase properties that they may not be able to afford on their own. From duplexes to condominiums, there are many different types of multifamily properties to invest in—but they are generally more expensive than single-unit properties. This is where multifamily syndication comes in.

In a syndication deal, multiple investors pool their resources together in order to buy a single commercial property. And because tenants pay rent on a regular basis, these multifamily properties can generate a continuous cash flow for their investors.

In multifamily syndication, a sponsor—also known as a syndicator—puts the deal together. They will look for an existing commercial or multifamily property to buy and then locate investors to participate in the deal. Most of the capital will come from the investors. The investors then earn money from the cash flow and the equity upon resale. [2]

The sponsor is in charge of finding a suitable property, putting the deal together, and also managing the property on behalf of the investors. This is critical for investors like dentists who are too busy to manage tenants and handle emergencies. It is one of the biggest benefits of syndication.

With the responsibility of managing the property given to the syndicator, investors no longer have to worry about the asset once they have purchased it. The sponsor will manage it for them. Some sponsors secure a third-party organization for property management. [3] Others, such as BAM Capital, have an in-house property management arm of their vertically integrated business model. 

Because of the part that they play in the deal, the syndicator typically receives fees and/or “distributable cash” that are left once all the expenses and loan obligations have been paid. [3]

For dentists, this takes a lot of weight off their shoulders. They can freely invest their money and enjoy passive income without worrying about the property itself.

Passive Real Estate Income for Dentists

The greatest benefit of real estate investing is that you get to choose how you spend your time since you are already enjoying some financial freedom. Without a passive source of revenue, you constantly have to worry about the next paycheck and the number of clients you are bringing in.

Real estate investing, particularly multifamily real estate, creates a positive cash flow which allows you to build your wealth over time.

The beauty of multifamily syndication is that investors get to enjoy the benefits that are usually afforded to the actual owner. This includes tax benefits and appreciation. Most income coming from multifamily syndication is tax-free, particularly when they are offset by depreciation. This means syndication can serve as a form of tax shelter. Investors get a check either on a monthly or a quarterly basis for the duration of the deal. [4]

Multifamily syndication targets to allow dentists to make money while they sleep.  The investment can grow even without much action on the part of the dentists. Dentists can enjoy a steady income and property tax benefits on their multifamily investment property while building wealth.

Why Work with BAM Capital for Multifamily Syndication

For dentists who want to try multifamily syndication, BAM Capital is the best option because of its vertical integration model that mitigates risk for investors.

BAM Capital prioritizes Class A multifamily properties because it values low-risk investments for passive investors. It also has a strong Midwest focus, prioritizing Class A, A-, and B++ multifamily real estate properties in that area. [5]

BAM Capital will arrange the syndication deal so there is no need to purchase an asset on your own. BAM Capital will also handle property management.

BAM Capital works with accredited investors and negotiates the purchasing and financing of high quality multifamily real estate properties on their behalf. This Indianapolis-based company currently has $700M AUM and 5,000 units. Schedule a call with BAM Capital and invest today.

BAM Multifamily Growth & Income Fund III

BAM Capital created this fund in order to yield consistent and reliable cash flow, long-term appreciation, and accelerated tax benefits. The fund aligns with BAM Capital’s demonstrated track record of successful multifamily investing by continuing to implement our signature investment thesis, now in fund format. The fund aims for greater overall returns and lower risk through a multi-asset diversification strategy.

  • Consistent passive income
    Lower-risk assets with in-place cash flows with the ability to distribute preferred return after acquisition.
  • Significant tax benefits
    A cost segregation analysis allows for accelerated deprecation to years of ownership. This large passive loss gets passed onto investors through a K1.
  • Vertically integrated company
    In-house property management and construction allow for predictable cost reduction and value add.

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The contents on this site are for informational and entertainment purposes only and do not constitute financial, investment, or legal advice. BAM Capital cannot guarantee that the information shared on this post or page is appropriate for you and your financial situation. By using this site, you agree to hold BAM Capital and any and all entities related to the writing & publishing including BAM Capital’s parent company harmless from any ramifications, financial or otherwise, that occur to you as a result of acting on information found on this site. Always consult your investment advisor, CPA, and other professionals before making an investment. BAM Capital is excited to help you grow your investment assets. Please contact us to see how we can help you.  

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