Our capital partners receive regular distributions/dividends that provide a consistent source of passive income throughout the life of the investment.
Millennials and baby boomers are creating an extremely high demand for long term and short term places to rent, which is reducing supply and increasing rental rates.
Core commercial real estate historically is a very stable asset class that helps to mitigate the volatility of your stock portfolio.
Tax laws are extremely favorable for real estate investments, helping investors to reduce their taxable income through tools like depreciation.
Commercial real estate continues to steadily appreciate year over year, which is why this makes a great asset to own for short and long hold periods.
Rental properties provide an inherent hedge against inflation due to increasing rents and property values, and tend to keep pace with other surrounding costs that are on the rise.
Home ownership is becoming less affordable with each passing year, creating a desperate need for more quality multifamily and apartment buildings. Unlike other real estate asset classes such as office and industrial that experience higher volatility due to economic factors, multifamily is a conservative hedge due to the key principle that people always need an affordable place to live. Companies downsize, shift to remote work, move overseas... but housing is a necessity.
Two major demographics are contributing heavily to the rising demand for more multifamily, Millennials and Baby Boomers. The younger generation is getting married later in life and delaying having families, reducing their need for more living space. They also are carrying a larger amount of student debt, which makes financing a first-time home purchase more challenging. A large percentage of Baby Boomers and empty nesters are downsizing to lower maintenance housing options that are also easier on a fixed retirement income. These two generations are pouring into the rental market at a dramatic rate, which bodes well for a sustained outlook.
Small boutique hotels have emerged as an attractive option for consumers, which has investors following close behind. Boutique hotels generally offer a more intimate ambiance that makes guests feel like they staying at a private home instead of a hotel. Growth of this landscape is driven by a rising demand for authentic and unique experiences. In a time where consumers seek more than just accommodation, the boutique hotel industry is fulfilling the desire for more personalized and memorable stays. This sector experienced its challenges during the Covid lockdowns, but unlike office space, has bounced back with higher demand than pre-pandemic. Economic conditions always present some challenges in the hospitality space, but the consumer appetite for these experiences remains strong.
What also makes this space a robust investment choice is the high percentage of owner-operators or "mom and pop" shops that make up the industry. Many in this demographic are ready to retire and have not been adequately maintaining the properties, allowing for discounted purchase prices. Just as appealing, these sellers are generally open to owner financing some or all of the debt. With conventional interest rates on the rise, these flexible purchasing terms are very attractive as they create a higher ROI for investors.
As a result of the pandemic, the option to work remotely has drastically grown in popularity over the last two years. More and more people are realizing that working remotely doesn't have to mean working from home. This has led to many travelers looking for short to mid term stays in fun locations. Hotels aren't hitting all the needs of these guests who are seeking friendships, community, activities, special events, ideas, workspace, collaboration, travel tips and culture.
HomWork is on the forefront of this new asset class, helping to revolutionize the way that digital nomads and business travelers experience different cities. Creating a safe and exciting environment for people from all backgrounds to come together and enjoy a fun work-life change of pace is an endeavor that has attracted the attention of investors large and small. The demand for this new asset class is rapidly increasing, along with the returns to our partners that are participating in these specific syndications. We will continue to seek out more opportunities in this segment to help our clients get in early and diversify their real estate portfolio.
Co-living and working spaces facilitate connections amongst other travelers and entrepreneurs. Those staying in town for a short while may nonetheless encounter a warm atmosphere with personal interactions and experiences that hotels are unable to provide.
Co-living with Co-working spaces provide guests with the ability to truly experience an area like a local. Having a community experience, a private room/ bathroom, and a communal place to work is a combination of amenities that is increasing in demand among regular travelers.
35+ million worldwide are identified as digital nomads. The economic value of the digital nomad segment is estimated at $787 billion per year. The co-living co-working hospitality niche is catering to this growing market segment in order to provide a necessary product that is currently lacking.
In order to create more diversification within the real estate portfolio, Passive Retirement invests in residential projects in the Southern California market. San Diego specifically is one of the fastest appreciating residential real estate markets in the country, which is why we are heavily involved with fix and flip projects and adding extra units to single family properties. Invest alongside with us for both short term and mid term returns.
