The Baby Boomer generation has been the driving force for theworld’s economy for the last 70 years. Right now, they’re just entering senior housing, whichmeans an explosion of need for assisted living.”

ment is up to the investor. Most investors and business owners that RAL Academy trains are hands off and they hire managers and a team to run the day-to-day operations. One of the biggest pieces of advice Guarino shares with RAL investors is to learn as much as they can before they begin and then get support from knowledgeable people that are actually in the industry. Too often he’s seen people make incorrect assumptions about how the industry works. For example, investors think they’re in good shape if they simply purchase a large house near a hos- pital. Guarino says that being near a hospital is not even in the top 10 items to look for. “Location is important—being across the street from a hospital is unimportant,” Guarino said. “If the resident needs to go to the hospi- tal every day, they should be in a nursing home, not an assisted living home. So, there are many things that people need to learn.” Guarino also advises that students decide what part they want to play in their business early on. People who just want to “be the money” should invest in a fund or a syndi- cation type of investment so they can be hands off. The key to their investment is having a good operator on the team—someone who knows what they’re doing, is trustworthy and is going to do a good overall job. Savvy real estate investors find their tenants before they purchase a prop- erty and the RAL Academy shows them how to do that as a part of their training curriculum. “If you simply want to own the property and be a real estate investor and not be involved in the business at all, there is a success formula to doing that right—too many people try to do it backwards,” Guarino said. “They buy a house, fix it up and then


“If you just own the real estate, which a lot of people get in this industry to do, you can typically lease it for up to twice the fair market rent,” he said. “If that house nor- mally rents for $2,500 a month, you can now lease it for $5,000 a month because the tenant is a business, and they have the income and cash- flow to pay that higher rent. The tenants aren’t the seniors living in the home. The tenant is the com- pany that owns and operates the RAL business. They’re not focused on the real estate as an investment,

they are focused on the cashflow of owning and operating the business. They’re using the real estate as a place to do their business. They want a five-year lease with renewals and they will take care of the mainte- nance as well. That is the Holy Grail for many landlords today especially when you can actually cashflow a bigger and nicer property.” The third option is for investors to actually own the real estate and operate the business. This doesn’t mean the investor is at the RAL home every day. The level of involve-

16 | think realty magazine :: september 2021

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