real estate investment

[Lina Riley]

With the current trend of real estate in the United States, is it a wise choice to invest in real estate? , Recently, I invested most of the liquid cash in my hand. The return on real investment is too slow. I like short-term investment. Do you have any recommendations?

[Michael Margarella]

While there is no such thing as “inflation-proof,” self-storage is inflation-resistant. With month-to-month leases, operators can more frequently adjust pricing to pace inflation. 

One of the drivers of self-storage is the “four Ds”: downsizing, displacement, death, and divorce. All of those things, unfortunately, increase during a recession, providing a safer base case for self-storage than some other assets. Storage occupancy rates during past recessions has remained relatively stable. For example, during a recession, when folks downsize from a 3 bed/1 bath to a 2 bed/1 bath, those people, historically, keep their belongings and put them in storage. 

With this, we pivoted to self-storage a few years ago. Now we syndicate larger self-storage deals and work with passive investors. 

These syndication can provide an 8%+ cash-on-cash return - providing you monthly cash flow - and a 15-20% IRR over the length of the project.