Why Invest in Real Estate Syndication with Shannon Robnett

Shannon Robnett For more than 30 years, Shannon Robnett Industries (SRI) has built a strong reputation as a leading commercial real estate investment group by investing in multi-family properties in the Treasure Valley. Our family of subsidiaries, including My Vertical Equity, Phoenix Commercial Construction, and Executive Management Services (EMS) Property Management, has grown to become a substantial earner in multi-family real estate syndication, investing in and around Boise, Idaho.

We assemble passive investors through our syndication to purchase land that we develop–through our subsidiaries –from the ground up. We maintain these properties before selling, typically achieving above-market returns. Our investments consistently generate higher rates of return in less time than other types of property investment groups through our proven model. This results in considerable passive income streams for our syndicate partners.

Episode Highlights Here:

Shannon:

Many people get confused, and I want to set that out there. Blockchain is the technology that Bitcoin is founded on that Ethereum is founded on

Pierce:

the digitalization of securities. So let’s unpack this a little bit. You said they go well together with syndications and, and it provides the partners, you know, liquidity and whatnot. So why don’t we like unpack that a little bit, and let’s talk about some of the advantages to blockchain and syndication, you know, partnerships and that type of thing?

Shannon:

The first thing I want to set up is the, really premise that blockchain is not a cryptocurrency, okay? A lot of people get that confused. And I just want to set that out there. Blockchain is the technology that Bitcoin is founded on that Ethereum is founded. And what happens in that is that that record is distributed so that everybody that’s involved in everybody can see what’s happened in the previous transactions and the current transactions. And the way that works well is if you think about the Title chain, right, you’re in real estate, most people listening to this podcast are in real estate, so they understand the chain of title. But you have to buy insurance for that. I just closed on a loan on a piece of ground that I’ve owned for four years, that I bought title insurance for four years ago. And now I had to pay $40,000 More for additional title insurance to ensure that I wasn’t going to cause problems and lien property that I don’t write, right? So there’s this cost involved with this insurance to ensure that you didn’t do anything you weren’t supposed to or didn’t disclose. But blockchain technology takes care of that. It takes care of that issue without the fees because when I bought that transaction, I recorded it on blockchain technology. And I put all of the documents into a smart contract. And I recorded on that token or that chain, and then that gets distributed. And everybody that joins that partnership becomes part of the LP, and all of that gets recorded, then all the workflows get recorded, right?

There are so many things that happen. India is adopting blockchain technology because over 70% of the lawsuits that happen in India are over the title. And this is the first place they’re implementing it because, well, how many Muhammads do they have? Right? And so the reality is that there it has so many real-world applications in it to apply it in this particular fashion, puts everything aboveboard. But then again, once you’ve got involved in syndication, what do you do with your documents? What do you you know, are you constantly calling the sponsor and going, Hey, did we see what happened? Are we getting rents done, are things happening on the project, and what’s going on? Still, the distributed ledger contains all that information and allows that access for everybody to see what’s going on inside the project, as well as outside the project. And then it allows people to have control of their limited partnership. Their shares of it, right?

Pierce:

So okay, the blockchain, you know, brought up a really good point, right? Bitcoins, not blockchain. This is a point that, like, you know, if you’re in crypto for, at any point, right, you quickly learned that the blockchain is the founding technology. Still, it’s not the crypto, the crypto just leverages the blockchain technology, which was created, and it’s why crypto is here to stay because it’s founded on that principle. Right. So, so people who who are, you know, oh, Kryptos, a fat or whatever. I think they missed that. So that’s a really, that’s great that you put you separated those two because it’s such.

Shannon:

A good way to look at that would be like Apple, okay, or Microsoft is even better, right? Microsoft is trading for hundreds of dollars a share. What does it make? It doesn’t, other than the surface, right, and maybe a terrible foray into making mobile phones that it didn’t do very well at. It doesn’t create anything. It doesn’t have a physical tangible asset. What it has is, it has intellectual property, right? And that property is what gives it its value. Much like crypto, it has a value that comes from the intellectual property of blockchain technology. And then you have your theory on that does something on top of that the Bitcoin doesn’t do, and then you’ve got Cardano and Solano, and all these other ones that happened because of its building on that underlying chain.

Pierce:

Right? Yep. Okay, the second point you made was that it creates full transparency between the partners, so you don’t have to constantly cut out so much of the middleman’s unnecessary work because it’s just centralized in one place. It’s like a, essentially like a Google doc that’s like all there then you can exactly like it