'You Can't Fake Cash Flow' Grant Cardone Distributes $60 Million To Investors In 2023, Breaking New Records While The Broader Market Struggles

In a real estate market facing numerous challenges, including flattening rents and rising interest rates, many real estate syndicators have been struggling to hit projections and forced to deliver disappointing news to investors. 

Meanwhile, the private equity real estate firm Cardone Capital stands out by breaking records in investor distributions. The company has been distributing cash to its investors every month, with a notable $7.6 million in December alone, culminating in nearly $60 million for the year. 

Unlike many in the sector, Cardone Capital continues to raise funds directly from retail investors, bypassing institutions or pension funds. The firm has successfully amassed over $1.2 billion in funding, catering primarily to "the everyday investor overlooked by Wall Street," as CEO Grant Cardone puts it.

Cardone emphasizes the significance of their achievement: “Cash flow consistently distributed to investors is a sure indication of a well-managed operation. You can't fake cash flow and you can't make it up. Your properties either have it or they don't."

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The real estate market is undergoing what Cardone describes as "the greatest real estate correction in my lifetime," surpassing even the 2008 crisis. This time, however, he predicts that major institutions, rather than individual homeowners, will bear the brunt of the downturn.

Many syndicators, lured by low-cost capital, have overextended themselves by investing in mediocre assets requiring significant rehabilitation and overly optimistic underwriting. This approach has recently led to several failures within the sector.

Ryan Tseko, Cardone Capital's Executive Vice President, credits their success to discipline: “Grant demanded we stay very disciplined as the money got cheaper and prices got higher. We chased deals too, but the locations were ten out of ten and did not require a rehab operation."

Cardone Capital boasts a robust portfolio with over 12,000 units across 37 multifamily properties and more than half a million square feet of office space, maintaining an impressive occupancy rate of approximately 94% across both sectors. This strong performance is in stark contrast to the current market trend, where banks are tightening lending standards on multifamily and other commercial properties, making it increasingly difficult for many investors to secure funding for new deals.

Cardone Capital’s record-breaking performance during a challenging year for the real estate industry underscores the importance of strategic investment and management practices. As the market navigates through a significant correction phase, Cardone's approach serves as a model for sustainable success in real estate investment.

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