We are looking at acquiring a number of senior living facilities in Florida in the coming 24 months. What would be the advantages of using one pooled fund to take down each facility? When is it more advantageous to go deal by deal?
Advantages: Great for investing smaller amounts of capital to purchase a property. Disadvantages: Less control over the property. It really comes down to 1) the deal/property itself and 2) the team you are working that is acquiring the property (and how many properties they can handle at a time).
To give you a precise answer, I would have to know more about your goals, your tax position and whether you will be the only investor, among other things. The first thing I would have to do is to look at whether you are in a jurisdiction which has a tax treaty with the US. Then I would gather the information necessary to give you an appropriate response.
The answer to your question is a function of what the exit or sales strategy is.
The reason most US acquisitions are done through separate entities is to create liability ring fencing between the separate assets. This can be done two different ways: one is to fund a create a new SPV for each property being acquired, the other is to have a holding company that pools the investment funds, but acquires each property through separate, wholly owned SPVs, usually single member LLCs in which the only member is the holding company. Usually the method preferred depends upon how your raise your capital and how returns are calculated and paid to your investors.
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