Be sure to listen in to this encore presentation of an interview with asset manager, Joe Stampone! Joe is an expert in real estate investments, a partner at Atlas Real Estate Partners, and the original student of the real estate game. In this interview, Joe and Jonathan go deep into why real estate should not be considered a passive investment, the only way they know how to make hit passive (hint: asset managers), and why investing in apartments beats investing in single-family homes every time. Joe has a lot to share, so don’t miss his insights!
Why you should focus on individual deals
Joe shares that his firm is focussed individual deals – it doesn’t take bets on classes or markets by just investing in one sector. His firm invests in middle market real estate across various product types, asset classes, and strategies. With each deal, Joe looks at what can be done to each asset to increase its value-add. For instance, if an apartment is not being fully maximized, his firm will change the name, roll out a rebranding campaign, create an online presence, change staffing, make processes more efficient, and done some physical renovation to add value back in. Joe is able to look at each deal to see what is needed and focus specifically on it.
How to predict an asset’s desirability over the next 10 years
Joe gives several questions to help predict an asset’s desirability over the next 10 years. By answering the questions, one can glimpse into whether an asset is a good investment in the long run.
- Is it near an employment hub where there are a lot of workers? People want to live near their work.
- Is there population and income growth? Has there been historically?
- Is there a barrier to entry to the market?
- Are there natural supply constraints?
Why an asset manager is vital to real estate investing
There is a large difference between investing in a rental property on your own and investing in a rental property through an asset manager. The field of real estate is complicated, institution, and competitive. If you are buying yourself, you’re using your own capital. You are the investor and the landlord. You get to make all of the decisions and take care of all interactions with tenants. Investing on your own does not lead to passive income. It is a full-time job. The only way to make real estate investing passive is to hire someone else, like an asset manager. An asset manager provides a good operational team that can use economies of scale to further investments. You don’t want to miss more on how you can invest passively. Be sure to listen.
The role of an asset manager
An asset manager is a role that is often overlooked in real estate, but it is very important. A property manager is on the ground in the market, but has a more narrow view – only interacting with his properties. An asset manager is a bridge between the onsite team and the larger business plan execution. The asset manager ensures that all things happening live within the framework of the investment and that all messaging is consistent. An asset manager also makes sure things are financially in line. Having an asset manager can significantly de-risk an investor’s transaction. Be sure to listen to hear Jonathan and Joe speak more on an asset manager’s role and importance.
In This Episode Joe Stampone says…
- [2:13] Who he is and what he does
- [8:47] Joe’s background with real estate investing
- [12:34] Looking at deals, not markets
- [19:43] Cap rates explained
- [22:51] How to predict an asset’s desirability over the next 10 years
- [24:10] What kind of investor Joe looks for
- [26:22] The difference in a personal residence vs. rentals as a real estate investment
- [34:29] Why asset managers make a different in real estate investing
- [39:39] The role of an asset manager
Resources Mentioned In The Episode
- Jonathan@MultifamilyLaunchpad.com – Learn to be an asset manager and Investor
- Bellwether Enterprise(sponsor) – contact Will Oldham firstname.lastname@example.org