In California, what is the most common structure of real estate syndicates?

The most common structure of real estate syndicates in California is a limited partnership. This structure is favored because it allows for the pooling of resources from multiple investors while limiting their liability to the extent of their investment.

In a limited partnership, there are typically two types of partners: general partners, who manage the day-to-day operations and assume full liability for the partnership’s debts, and limited partners, who contribute capital and receive returns on their investment but are not involved in management and whose liability is limited to their investment amount. This separation of responsibilities and liabilities makes it an attractive option for many real estate investors.

The limited partnership structure provides flexibility and access to regulatory benefits, making it well-suited for syndications where multiple investors come together to fund larger real estate projects. It enhances the ability to raise capital while offering a level of protection to passive investors, which is a significant draw for many looking to invest in real estate without taking on the full risks associated with ownership and management.