Holding Company LLC -- is this overkill?

[Bienes Raices]

My lawyer has mentioned a setup where a holding company LLC leases the property to a management company LLC. There would probably need to be multiple holding companies--propably one per property, but only one management LLC. This would make it a lot harder for someone to seize the house in the LLC if they obtained a judgement and the judgement went over the insurance limits (or insurance denied the claim).

This setup sounds pretty solid, but the initial setup cost would be about $2000, and then of course there are the annual fees for the LLCs, and the registered agents, if necessary. I believe that my lawyer is very competent, but of course all lawyers want to make money so I thought it best to run this by other people first.

I've seen a couple other people mention holding companies on here before, but I wonder if this kind of setup is only for someone who owns A LOT of properties and is more of a lawsuit target? The sense I've gotten here and elsewhere is that investors just set up a run of the mill LLC rather than something like this. I'm wondering if I'd just be wasting money with this setup. One big advantage I can see is that all the bookkeeping could be done through the management LLC (rather than through each separate LLC if it were set up the usual way), making things less complicated. Thanks!

Edit: Josh, I think I put this in the wrong category--could you please move to Goals, Business Entities? Thanks!