This article won’t address finding or analyzing your project. You’ve gone through the home study course, attended a bootcamp (or two) and hopefully have a mentor who can help you with all that. This will start with the assumption that you will need to pool funds from investors to make the deal happen.

First of all, when writing up your offer, try to put the closing date out further than you think you’ll need. Try for 75-90 days, and if you can only get 60, add in an option for a 30 day extension, even if you have to pay for it by letting part of your earnest money go hard. Unless you already have the down payment in the bank, count on  delays that will have you sweating bullets and losing sleep.

As a corollary to this rule, examine the calendar and try to avoid going through major holidays before closing. I first started working on this apartment deal in early October, and was thrilled when I had a signed contract by October 26. Little did I realize, a 60-day closing put us at December 26, the day after Christmas. Not only was this a holiday, since Christmas fell on a Sunday, but people start taking time off in the week before. Not much gets done between Christmas and New Year’s for that matter. You may be willing to give up family time to get the deal done, but it’s just not as critical for lenders, title companies or brokers. Also, Thanksgiving was in there and took at least another five days off the schedule. Luckily for me, the seller was willing to push the closing to mid-January, but you sure can’t count on that.

If your investors will not be actively running the project with you, but will depend on your efforts to make a profit, you’ve probably created a security. In that case, you’ll need to hire a securities attorney to draft your Private Placement Memorandum, Subscription Agreement and Operating Agreement. You won’t begin that process until you have a signed contract and the clock is ticking. Count on 30 days to get that back. With a 60-day closing date, you’ll only leave yourself a month to get these to your investors, with barely enough time to read through and understand the docs, run them by their accountant or financial advisor, make a decision and get the money into your account.

It’s very important to have more investors interested in working with you than you’ll actually need. I had a list of 26 folks who had expressed interest in being commercial real estate investors, but in the end, only six actually signed up and sent in their money. If it had only been five, I would have been in a tough spot. If you don’t close, you not only lose your upfront cash, you also lose credibility with the investors who now get their money back. Good luck in getting them interested in your next project, and try not to think about how they may represent their experience with you to their friends.

One way to mitigate some of this is to have a range of funds you’re going to raise. Your PPM can let you break impounds (start spending your investors’ money) when you’ve raised enough to cover the down payment and closing costs. Then you have an upper limit you can continue to raise, even for several months after closing. That’s the money that will pay your syndication fee and build reserves. I’m still waiting on one investor’s money to come in, but at least I had enough to close.

The reason his money hasn’t arrived yet is because he recently found out his so-called self-directed IRA custodian wouldn’t let him invest in real estate. So at the last minute, I had to help him roll his IRA to a new custodian that allows this kind of investment. If any of your investors will be using their retirement fund to get into your deal, make sure you know the custodian allows full self-direction of funds, and expect it to take longer than just writing a check. The custodian won’t give their OK until they’ve seen your PPM and Operating Agreement (at the very least).

Finally, when you’re recruiting investors, see if they’re fine with submitting their financial statement and tax returns to the lender, and then signing personally on the note. Most banks will want this from you, as well as anyone who will own 20% or more of the LLC. Even if everyone is below that threshold, they may want at least one of them to sign as a guarantor on the loan. Don’t be surprised if they want their spouse, and yours, to sign personally on a full-recourse loan as well.

I wish I had know all this back in October when I put this together. I would still have done it, and plan to do it again, but at least I wouldn’t have had so many surprises coming at me so quickly. I hope this will help you as you move into your first syndication. Good luck!

Major investors from out of the area have recently purchased large multifamily properties in Colorado Springs. In October, Sequoia Property Partners of New York closed on the South Circle Arms, a 112-unit apartment complex built in 1969. Many new upgrades were completed in the last five years, including new 30-year roofs on all the buildings. The $5.4 million purchase price produced a value of just over $48,000 a door.

Another October purchase was of the Rustic Hills Park Apartment, one of the last large distressed properties in Colorado Springs. The 243-unit property went for the bargain price of just over $17,000 per unit, or $4.2 million.

The new owners, Connexion Asset Group of Lakewood, CO, need to address a backlog of deferred maintenance and a low occupancy rate to stabilize the property. They have a successful track record of turning around failed assets, which is why they were selected from the 15 bidders on the offering.

This past summer Advenir, a Florida-based real estate company, bought the 220-unit Briarglen Apartments for $16.3 million, or $74,000 a door. They have announced plans to buy up to 2,000 units in the Denver and Colorado Springs markets. Chief Acquisitions Manager Todd Linden says, ““We think, long-term, Colorado is a great state to invest in. There’s going to be a lot of job growth there.”

At the end of September they purchased the Cheyenne Crossings Apartments for $19.5 million, coming in at over $85,000 per unit for the 220 units.

Seagate Properties of California now has a Denver office and hopes to build their Front Range portfolio to 2-3,000 units. They already own a couple of smaller apartments in downtown Colorado Springs, and in 2010 purchased the 115-unit Fillmore Ridge Apartments for $2.8 million, or just over $24,000 a door.

After years of little or no multifamily development, several new projects are under way, or awaiting final approval.

Grading is already underway at the corner of Woodmen Road and Union Boulevard, where Denver-based Southwestern Investment Advisors and Utah-based Talos Holdings have teamed up to build a 230-unit luxury apartment complex.

Up north in Monument, local group Vision Development has begun a 177-unit complex and at the south end of town, long-time local developers, the Nor’wood Development Group, has broken ground on the 240-unit Mesa Ridge Apartments. This project is close to Fort Carson, which should continue to add troops coming back from tours in Afghanistan, as well as the aviation brigade, expected to arrive with their helicopters and support staff in 2013.

On the east side of town, near Peterson Air Force Base, there is a large mixed-use project in the planning stages that would include 450 apartment units in addition to two military office buildings, restaurants and retail space. It will be near the intersection of two major arterials, Powers Boulevard and Airport Road.

All of this new construction activity has pushed the number of multifamily permits granted this year to 407, the most since 2002, when 1,664 permits were issued. That single year had more permits issued than all the subsequent years combined. In fact, in 2009, exactly zero multifamily permits were pulled.

With 44,000 apartment units now available, this year’s total will add less than 1% to the total. With its low vacancy rate and rising rents, it’s no wonder the Springs is looking so attractive to investors and developers.

Disclaimer: I am not an attorney and this is not to be construed as legal advice. Always consult appropriate counsel when pooling money for an investment.

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The cities on the list ahead of Colorado Springs are Omaha, NE (1st), Charlotte, NC, and Nashville, TN. Pretty good company, I’d say.

The things they liked about Colorado Springs included the 36% of residents that are college grads, it’s a regional hub for large national employers, rental and utility rates are very low, and of course our Pikes Peak backdrop.

If you have a reason to want additional people to come to your town, being on this list is surely a good thing.

You can see the complete article here.

Here’s an additional article on Colorado Springs as a top ten town:

• Colorado Springs Top 10 City for College Grads? (coloradospringsapartmentinvestor.com)

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Colorado Springs was cited for having a tech-based economy and an inexpensive cost of living. Rents are low, and it’s always listed as one of the fittest cities in the U.S, possibly because of the easy access to hundred of miles of trails and open space. Compared to other cities on the list, it has a higher proportion of 20-24 year olds. Colorado Springs was also noted for its low crime rate and well-educated citizenry.

Negatives for the city were a low median income, weak public transportation, and a high-unemployment rate for the under-skilled.

The other cities on the list are New York City, Charlotte, NC, Baltimore, MD, Washington, D.C., Omaha NE, Seattle, WA, Boston, MA, San Francisco, CA, and Philadelphia, PA.

To see the original article and read more about the winning cities, visit Kiplinger.com