Red Flags in a Real Estate Sponsor and How to Spot Them w/ Brian Burke

Real estate sponsor decisions can make or break your entire investment. A good sponsor can navigate a bad situation. A bad sponsor can blow up a perfectly good deal.This episode is co-hosted by Ben Gray, partner and CEO at RSN Property Group. We’re joined by Brian Burke, founder and CEO of Praxis Capital and author of “The Hands-Off Investor”. With more than 30 years of experience, Brian has operated through multiple market cycles and acquired over a billion dollars in real estate. He’s seen the run-ups, the corrections, and exactly what happens when deals are built on shaky foundations.In this conversation, he shares what actually matters when evaluating a real estate sponsor in today’s environment.We break down the key things you need to look for when evaluating a sponsor and how to avoid the costly mistakes that many investors make. We talk about the right questions to ask, the sponsor’s track record you should focus on, and why a sponsor’s debt strategy and capital stack can shape the entire outcome of a deal.If you’re investing passively or thinking about it, this episode will give you a checklist to confidently vet a real estate sponsor and protect your capital.Let's dive in!Key Takeaways: 00:00 Intro 02:29 Chase sponsors, not deals 04:13 Market trends and making sense of demographics 08:35 How to properly vet a sponsor10:24 The harsh truth about ROI12:41 Sponsor due diligence and red flags 14:38 Three crucial questions to ask a sponsor 16:04 Fees, waterfalls, and underwriting 29:17 Debt and maturity dates 31:54 Advice for aspiring investors 32:58 Outro Additional resources: ➡️ Check out Brian Burke: • Instagram: https://www.instagram.com/investorbrianburke/     • Website: https://praxcap.com/ ➡️ Visit https://reedgoossens.com/ and:• Invest passively in multifamily real estate • Get FREE access to my 100% Passive Real Estate Investment Masterclass• Take a look at my portfolio• Get FREE multifamily real estate resources ➡️ Follow me on social media:• LinkedIn: https://www.linkedin.com/in/reed-goossens-b2a6a933/ • Instagram: https://www.instagram.com/reedgoossens/ • Facebook: https://www.facebook.com/reed.goossens/ ➡️ Subscribe to my podcast: • YouTube: @ReedGoossensREI • Apple: https://apple.co/44MiDN7 • Spotify: https://spoti.fi/45fVIcR • Stitcher: https://bit.ly/3OHHJqJ • Soundcloud: https://soundcloud.com/investing-in-the-us Investing in the U.S. is a podcast for real estate investors and entrepreneurs who want to break into the U.S. market and grow their wealth!Follow so you never miss an episode!