OPERATIONS: ADJUSTING TO CHANGE
TAKE CONTROL OF YOUR TIME. You want to strike a better balance between your work and the personal life you work so hard to support. Passive income is not an end in and of itself. It’s a means to get you to what you want: income freedom, time freedom, financial peace, and mental peace from knowing you don’t have all your eggs in one basket (your commissions). YOU UNDERSTAND IT. Warren Buffett is famous for saying, “Invest in what you understand.” You already understand real estate. There are plenty of similarities between residential and commercial real estate. The stock market? That’s a different story.
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Here are six advantages:
into a rental worth $250,000 or $50,000 into a commercial building worth $5,000,000. That’s up to you. REDUCE THE PAIN OF THE COMMISSION ROLLERCOASTER. You eat what you kill. Or something like that. But we all know there are factors you can’t outwork or control—the Fed, interest rates, and a lack of supply, for starters. When you invest in a commercial property, you set up additional streams of wealth to support you during slow times or unlock access to extra vacation days, summer camps, and college savings for your family. What if you invested $100,000 in a warehouse with a 134% return over 10 years? You’d average nearly $10,000 per year in passive income, a cool $36,000 from the sale proceeds, and the return of your initial investment (without considering tax benefits). Not too shabby.
TAX-ADVANTAGED INVESTMENT. When you invest in commercial properties, you can get a slice of the losses to offset your income from the deal. In many cases, you can legally show little to no income from the investment. VALUE APPRECIATION. Homes get bought, renovated, and sold. The rehabber cashes a nice check and moves on. Commercial properties can undergo a similar process. As a passive investor, you share in the upside. But, unlike a house, the process takes longer (three to seven years). SCALE WITH LESS CASH. To acquire a portfolio of rentals, you need a lot of money. When you invest in a commercial syndication, you own part of a multimillion-dollar property for as little as $50,000. Put $50,000
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Investing in real estate isn’t for everyone. Every investment (whether it’s real estate or something else) has its risks.
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Where do you start? Find a community of like-minded agents
(e.g., www.AgentOptional.com) who share the same concerns and passion for taking control of their financial future as you do. You aren’t alone in your desire for a better balance between work and life and a way to earn more without sacrificing more time. •
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Neil Timmins is a real estate syndicator, broker, and educator. He generates passive income opportunities through industrial real estate in “Cash Flow Country,” the Midwest.
After spending years investing in houses and $300 million in transactions, he graduated to investing in commercial real estate. Now he educates others on how to do the same. Neil hosts the podcast "Passive Real Estate Investing with Mavericks." His first book “Unicorn Hunting for Real Estate Investment Companies: The Complete Hiring Funnel” was released in 2021.
48 | think realty magazine :: january – february 2024
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