FAQ
Common questions, answered plainly
Real estate investing should not feel like a black box. Here is how limited partnerships, passive investing, and the numbers work at Marblanc Capital.
The Basics
- What is multifamily real estate investing?
- Multifamily investing means acquiring apartment communities with multiple units (5 or more) and leasing them to residents.
- What is a limited partnership?
- A limited partnership is the legal structure Marblanc Capital typically uses for each investment. You become a limited partner (passive investor) alongside other investors and the general partnership (the sponsorship team that operates the property).
- What does passive investing mean?
- Passive investing means you contribute capital to a professionally managed apartment deal without handling tenants, toilets, or trash. The sponsorship team manages the asset, executes the business plan, and distributes income and sale proceeds to investors according to the operating agreement. You receive the benefits of real estate ownership without the operational burden.
Understanding the Numbers
- What is cash-on-cash return?
- Cash-on-cash (CoC) measures the cash income an investment produces in a year relative to the cash you invested. For example, if you invest $100,000 and the property distributes $8,000 in a year, your cash-on-cash return is 8%. Marblanc Capital targets 6–8% average annual cash-on-cash over the life of the property, though actual distributions can vary year to year.
- What is IRR?
- Internal rate of return (IRR) is the annualized rate of return earned over the full hold period, taking into account all cash flows — initial investment, ongoing distributions, refinance proceeds, and final sale proceeds — and the timing of each. It captures the time value of money: receiving the same dollar sooner increases IRR. Marblanc Capital targets a 15–16% or higher IRR.
- What is average annual return (AAR)?
- Average annual return is the simple average of the yearly returns over the investment hold period. Unlike IRR, it does not weight the timing of cash flows. Marblanc Capital targets a 17–20% or higher average annual return, inclusive of cash flow and appreciation.
- What is an equity multiple?
- Equity multiple shows how many times your total invested capital is returned by the end of the deal. If you invest $100,000 and receive $177,000 back in total distributions and sale proceeds, your equity multiple is 1.77x. It is a straightforward way to see cumulative performance, but it does not account for how long the investment took.
Ways to Invest
- Can I invest with cash?
- Yes. Most investors fund their commitment with a personal or entity check or wire transfer after reviewing the offering documents and completing subscription paperwork.
- Can I invest through a 1031 exchange?
- 1031 exchanges can allow you to defer capital gains taxes by reinvesting proceeds from the sale of a like-kind property into a new investment. Not every Marblanc Capital offering is structured to accept 1031 proceeds, and timing and structure matter. We recommend consulting a qualified intermediary and tax advisor to determine if a 1031 exchange fits your situation.
- Can I use a self-directed IRA?
- Yes, many investors use a self-directed IRA (SDIRA) to invest in private real estate syndications. Your SDIRA custodian must be able to hold alternative investments and send capital on behalf of your retirement account. All income and proceeds flow back to the IRA.
- Can I invest through a Solo 401(k)?
- A Solo 401(k) can also be used to invest in multifamily syndications if the plan documents allow for alternative investments and the plan trustee can direct capital into the offering. As with any retirement account, speak with your plan administrator or tax professional before committing.
Liquidity & Timeline
- How long is my investment tied up?
- It depends on the hold period of the specific deal. Marblanc Capital generally targets a 3–7 year hold period, during which the sponsorship team executes renovations, improves operations, and grows net operating income before a refinance or sale. Unlike publicly traded stocks, these investments are illiquid and there is no guaranteed market to sell your interest before the property is sold.
Sponsorship Experience
- What kind of sponsorship teams does Marblanc Capital partner with?
- We only work with sponsorship teams that have at least five years of direct multifamily experience, have managed prior investments without capital calls, and are active operators in their own deals — not passive capital raisers who simply sign on a loan. We also look for sponsors who invest their own capital alongside investors, known as having skin in the game, and who treat residents as members of a community rather than entries on a spreadsheet.
Still have questions?
Every investor situation is different. If you would like to talk through how a specific opportunity fits your goals, reach out directly.
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