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Editor’s Note: Dennis Fassett is a former corporate finance executive turned real estate investing “Cash Flow Mercenary.” Dennis specializes in single-family and multi-family cash flow properties and thoroughly enjoys assisting his fellow investors with their own strategies, including how to buy your first apartment building.
As an ongoing contributor to Mogul’s “Market News Updates,” Mr. Fassett provides us with his own unique, lively, and thought-provoking commentary on the timely industry news and events of today that are impacting our industry. And be sure to check out his other super-helpful Market News Updates. For now, enjoy...
From Dennis Fassett, Cash Flow Mercenary...
To be honest, I know next to nothing about Pokemon. And I’m good with that. All I know is that my son is constantly running out of the house to go find some character that popped up in the neighborhood somewhere.
Overall it looks like fun. And getting kids out from behind their screens and running around the neighborhood isn’t a bad thing.
But the law of unintended consequences is rearing its ugly head with it. I read an article recently about how it’s looking like a bad thing for real estate investors. So much so that the author stated that recent events have shown that Pokemon Go real estate troubles are a very real thing that investors should be aware of. Now.
Pokemon NO!
Based on the article, I understand that the app-based game takes advantage of augmented reality technology by allowing players to wander around collecting virtual creatures, which they can then train and battle. And he also said that the game’s adoption rate has already broken records and shows no sign of slowing down yet.
He went on to say though that the game has also been shown to inspire incidents of mass frenzy such as in Central Park, when a rare Pokemon was generated within the game’s version of the park itself, and players descended onto the park en masse to try and capture it.
When that happened, traffic in Manhattan came to a stop as people abandoned their vehicles wherever they sat to join in the hunt.
As incidents like this continue popping up, the natural question you may be asking is “how does this affect real estate?”
The answer is simple – personal liability.
Pokemon Go… Away
Given the game’s penchant for creating hubs around certain real estate landmarks such as parks and churches, properties located in the vicinities of such places are opened up to trouble.
The author related an example where one Massachusetts man purchased a home that was originally a church in the 1800s.
After downloading the app, he learned that it was designated as a ‘gym,’ meaning a hub where Pokemon can be ‘trained’ to fight. Soon after, young children and teenagers began camping out around his property at all hours of the day and night with their smartphones.
Imagine, for example, pulling out of your own driveway one weekend morning and, before you realize it, a teen darts across it hunting for a Pokemon nearby, and you accidentally hit the person.
Even though you were trying to be careful, an injury still happened, and you could be liable for it.
Cases of players getting into accidents because of being distracted by the game are becoming commonplace. Furthermore, the risk for unwitting players to be shot at by homeowners unaware of what is happening exists as well.
The combination of the game encouraging exploration coupled with a lack of awareness on the players’ part will lead to more accidents as Go’s popularity continues skyrocketing.
For investors, Pokemon Go real estate troubles provide a flashy but relevant example of why asset protection is important to have in today’s world.
If you own a property and face a situation where a Pokemon Go player is injured on it, a resulting lawsuit could quickly snatch away everything you’ve worked hard to attain over nothing more than a game.
So make sure you have adequate asset protection in place.
Talk to Me
Do you think these Pokemon Go concerns are valid? Share below.
Dennis Fassett
earned a BS in Economics and followed that up with an MBA in finance. After working and corporate finance and banking for several years, he started buying single family houses, and quickly built a very nice portfolio of cash flowing rentals. When the credit markets started to dry up and he couldn’t get any additional single family mortgages he shifted his focus to apartment buildings. He now has over $3 million in rental real estate. He manages most of it his self and still has a day job. Dennis has even created his own Private Equity fund to buy apartment buildings.