Ep63: David Persons: The Truth About Real Estate Syndications vs. Direct Development

Your Business – Your Next Level

In this episode of Your Business Your Next Level, I sit down with David Persons, a seasoned real estate developer with a diverse background in multifamily, commercial, and modular construction. David shares his journey from growing up in a construction family to working with global tech giants like Facebook, LinkedIn, and Google on real estate developments in South America. He explains why he left the corporate world to start his own firm, how he strategically raises capital, and the key differences between working with developers versus syndicators. David also provides invaluable advice on performing due diligence before investing, negotiating deal terms, and ensuring transparency in business partnerships. If you’ve ever considered real estate investment or development, this episode is packed with actionable insights.

Key Takeaways:

The Difference Between Developers and Syndicators: Unlike syndicators who focus on gathering investors and earning management fees, developers are directly involved in creating and managing the project, often providing more control and flexibility for investors.

Customizing Investment Terms: Investors working directly with a developer can negotiate their terms, participate in meetings, and have greater transparency compared to rigid syndication agreements.

Due Diligence is Critical: David stresses the importance of researching developers, verifying their track record, checking references, and ensuring that all agreements—including NDAs and non-circumvent clauses—are in place.

Why Modular Construction is Growing: David discusses how modular buildings are revolutionizing industries like education, offering cost-effective and scalable solutions for large-scale expansion projects.

The Importance of Legal Agreements in Partnerships: One of David’s biggest lessons was learning the hard way that handshake deals can lead to major issues. Ensuring clear contracts and well-defined responsibilities is key to avoiding conflicts.

Timeline Summary:

[00:00] - Introduction to David Persons and his journey into real estate development.

[02:00] - From multifamily acquisitions to working with tech giants in South America.

[05:00] - Understanding the key differences between developers and syndicators.

[08:00] - How investors can negotiate better terms with developers.

[12:00] - The growing role of modular construction in commercial real estate.

[15:00] - Why performing due diligence is the most critical step before investing.

[20:00] - Lessons from past partnerships and the necessity of strong legal agreements.

[25:00] - Final thoughts on building successful real estate investments.

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