So you like to go both ways, huh?
You like to have your cake and eat it too?
Well good for you! Life is too short for anything less!
That’s right. Now that Mother’s Day has come and gone, forget everything your mamma ever told you about moderation, and keep aiming for the stars…
…especially when it comes to diversifying your portfolio of real estate investments.
Diversified Investors Sleep Better At Night
The smartest real estate investors diversify their holdings across multiple property types, including (in alphabetical order):
-
Agricultural Land
-
Healthcare Facilities
-
Hotels
-
Industrial Warehouses
-
Residential – Mobile Homes
-
Residential – Multifamily Housing
-
Residential – Single Family Housing
-
Office Buildings
-
Retail – Enclosed Malls
-
Retail – Shopping Centers
-
Self-Storage Units
Diversification across different property types allows an investor to enjoy protection from the “ups” and “downs” of inevitable economic cycles, providing stable cash flows across a wide range of economic scenarios.
For example, suppose an investor owns a real estate portfolio which includes two types of residential holdings – multifamily housing (ie. apartments) and single family housing (“regular” houses). This diversified investor would have been relatively shielded from the latest downturn in residential housing (see “Great Recession”), because tenants’ demand for multifamily housing was skyrocketing at the same time that their demand for single family housing was reaching historical lows.
In short, it is good to be diversified! Diversified investors get to sleep better at night, knowing that they can profit in a wide variety of economic cycles.
But How Do You Manage A Diversified Operation?
Chris Urso purchased his first rental property when he was 21 years old, and over the following years, he was instrumental in growing his family’s real estate investment company from 5 to 150 employees – eventually selling the firm to a larger competitor for over $20,000,000.
Needless to say, Chris possesses a wealth of experience in the areas of property management and organizational strategy. And he knows a thing or two about the sometimes delicate balancing act required for managing a well-diversified operation.
Today Chris’ portfolio includes both multifamily housing and single family housing, thereby allowing him to enjoy many of the benefits of strategic diversification. Real Estate Mogul recently caught-up with Chris to find out exactly how he pulls it off. Check-out our previous interview with Chris to get up-to-speed on his general business philosophy, then get ready to learn exactly how the sausage is made.
Chris Urso explains how the sausage is made…
{Mogul Elite: Download a transcript and MP3 of this lesson in the Power Pack tools for this lesson.}
Diversify – Understand that it is possible (and beneficial) to own a diversified portfolio of real estate investments.
Strategize – Use residential rehabbing to enjoy occasional chunks of cash, while building “true wealth” by buying and holding multifamily properties.
Focus – As your portfolio becomes more disparate, focus on the responsibilities which maximize your personal talents, while hiring other teammates to focus their talents on the other responsibilities.
Christopher Urso
is the founder of URS Capital Partners and National REIS. Chris has been investing in real estate since 2001. Over the years he has been involved in all aspects of real estate, from single-family fix and flips, buy and hold cash flow houses, and finally to apartment buildings. His real estate investment career only took off when he purchased his first apartment building 3.5 years ago. He now controls over $15,000,000 of apartments and has raised over $8,000,000 of private money in just over 3 years. He now structures investment partnerships to acquire large apartment complexes and also private coaches investors helping them purchase their own apartment buildings.