A Multifamily Real Estate Investment Company

Cash-on-cash return measures the annual pre-tax cash flow you receive relative to the total cash you invested. For example, if you invest $100,000 and receive $8,000 in cash distributions in a year, your cash-on-cash return is 8%.

The internal rate of return (IRR) is the annualized rate of return generated over an investment's life, incorporating the timing and size of all cash flows. AmeriSouth's reported average IRR is a weighted-average across projects we have completed; it includes all cash distributions and sale proceeds discounted back to the original investment date. Because IRR is sensitive to the timing of cash flows, longer hold periods (with distributions spread over more years) can result in a lower annualized IRR even if the total return is strong.

A real-estate syndication is a partnership where multiple investors pool capital to acquire, operate and eventually sell or refinance a property that would be difficult to purchase individually. The general partner (or syndicator) is responsible for locating the property, underwriting the deal, securing financing, developing the business plan and executing it. Limited partners contribute capital and receive their share of cash flow and profits. Unlike some sponsors who outsource management, AmeriSouth operates every property we buy or own—we handle day-to-day operations and property management internally. This hands-on approach gives us more control over performance and aligns our interests with investors.

An accredited investor generally has an annual income over $200,000 (or $300,000 with a spouse) for the past two years and expects the same this year, or a net worth over $1 million excluding their primary residence, or holds certain professional licenses. AmeriSouth's offerings are primarily limited to accredited investors. Minimum commitments typically range from $25,000 to $100,000, though the exact amount is specified in each offering.

Many multifamily syndications plan for a 5- to 7-year hold, selling the property once it has appreciated. Our strategy tends to be longer: we aim to buy and hold for seven to ten years or more, giving the asset time to stabilize and grow. During the hold period investors typically receive quarterly or annual cash distributions. Once the property has appreciated, we may refinance the initial loan to return a large portion of your invested capital while continuing to hold the asset. Industry guidance notes that some sponsors refinance once a property has appreciated, allowing investors to recover their capital while still benefiting from future cash flow. If market conditions aren't favorable for a sale, the syndication can extend the hold period or pursue a cash-out refinance. After a refinance, you still own your stake and receive distributions on the remaining equity.

To compensate the sponsor for sourcing and managing the deal, most offerings include an acquisition fee (often 1–3% of the purchase price), an asset-management fee and a disposition fee. Investors typically receive a preferred return—often 6–8%—before the sponsor participates in additional profits. After the preferred return and return of capital are paid, remaining profits are split according to a waterfall. A common two-tier waterfall splits profits 80/20 (LP/GP) up to an IRR hurdle (e.g., 8–12%), then shifts the split to 70/30 or even 60/40 as returns exceed higher hurdles. Some structures use additional tiers: profits might be split 70/30 up to a 12% IRR, then 60/40 up to a 15% IRR, and 50/50 above that level. These shifting splits incentivize the sponsor to outperform investor return thresholds. In a cash-out refinance, the sponsor may refinance a short-term loan into longer-term debt, using the proceeds to return some or all of the initial capital to investors. After a refinance, investors usually remain in the deal, but their preferred return is calculated on the remaining capital. The same waterfall tiers still apply, so once the required IRR hurdles are met, the profit splits can shift to 70/30, 60/40 or 50/50 depending on the deal structure.

Syndication investments are illiquid; your capital is tied up for several years and depends on market conditions, interest rates, tenant performance and the sponsor's execution. AmeriSouth mitigates these risks by focusing on strong markets, using conservative underwriting, operating every property ourselves with experienced in-house management and maintaining transparent investor communications. We also structure our deals so that if market conditions are unfavorable, we can extend the hold period or refinance instead of being forced to sell. Past performance doesn't guarantee future results, and investors should always perform their own due diligence.