No matter what position you occupy in the real estate spectrum, at some point you need to know which asset classes to put your time and money into. Weighing up the pros and cons between them requires research, and many asset classes tend to fall beneath the radar. Self-storage is one of these, and Fernando Angelucci, who is our guest for today, gets into the many reasons why investors should be taking this asset class more seriously. Fernando is founder and president of Titan Wealth Group, which operates nationwide sourcing off-market investment properties, particularly in the self-storage space.
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He currently owns properties in almost half the states in the US! Fernando comes from an engineering background and his analytical mind and love for data were responsible for his transition from the multifamily space into self-storage. Fernando gets into some of this data today, making the job of a self-storage landlord as opposed to a multifamily one look easier and more lucrative in many ways. His arguments for the superiority of self-storage refer to interest rates, bank loans, eviction legislature, cap rates, break-even rates, tenancy type, ease of management, off-market abundance, and more. Joining this conversation, one begins to wonder why anybody would invest in any asset class other than self-storage!
Key Points From This Episode:
- Fernando’s real estate journey beginning with investing in single-family homes.
- How Fernando got into self-storage after having tenant issues in the homes he owned.
- Trajectories showing how self-storage had higher returns than apartments or the S&P 500.
- Groups such as Boomers and Gen X’ers that self-storage caters to and why.
- How big the leverage banks offer on self-storage is compared to other asset classes.
- Reasons why banks offer such high loans for self-storage: it is less risky.
- High cap rates pertaining to self-storage due to market fragmentation.
- Break-even rates that self-storage units yield which are far lower than multifamily.
- All the things that make self-storage easy due to having no tenants (no upkeep or evictions).
- The ‘eviction’ process in self-storage which relies on laws with less tenant bias.
- Ease of management that comes with investing in self-storage.
- Things Fernando dislikes about self-storage: decluttering trends and tech integration costs.
- The high sticky rate in self-storage, caused by the expense of moving out and other factors.
- How Fernando turns self-storage competition from different investors to his own benefit.
- The value of aligning all entrepreneurs in a business in order for it to improve.
- Great ways Fernando likes to give back through food drives and community events.
[bctt tweet=”I started to see why banks were giving me such great leverage is because they use self-storage to offset the riskier loans they are giving. — Fernando Angelucci” username=”whitney_sewell”]
Links Mentioned in Today’s Episode:
About Fernando Angelucci
Fernando O. Angelucci is Founder and President of Titan Wealth Group. He also leads the firm’s finance and acquisitions departments. Fernando Angelucci and Steven Wear founded Titan Wealth Group in 2015, and under his leadership, the firm’s revenue has grown over 100% year over year. Today, Titan Wealth Group operates nationwide sourcing off market investment properties for Titan Wealth Group’s acquisition as well as servicing a network of thousands of active real estate investors world wide. Prior to founding Titan Wealth Group, Fernando worked for Dow Chemical, a Fortune 50 company, rolling out a flagship product estimated to gross $1B in global revenues. With an engineering background, Fernando is able to approach real estate investing with a keen analytical mindset that allows Titan Wealth Group to identify opportunities and project accurate pictures of future performance. Fernando graduated from the University of Illinois at Urbana-Champaign with a B.A. degree in Technical Systems Management.
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