What are the three most recession-resistant asset classes in real estate?
Even in challenging economic times, multifamily, mobile home parks and self-storage perform quite well.
Sergio Altomare built a portfolio of small multifamily properties while working full-time in technology for the Federal Reserve.
But in 2018, Sergio was having a hard time getting deals to pencil. He anticipated a market correction and pivoted to self-storage.
Today, Sergio is Cofounder and CEO of Hearthfire Holdings, a real estate private equity and development firm that manages over $50M in self-storage assets.
On this episode of Financial Freedom with Real Estate Investing, Sergio joins Garrett and me to discuss the benefits of investing in self-storage.
Sergio describes the financing challenges he’s facing in his business right now and shares his outlook for the self-storage market moving into 2024.
Listen in for Sergio’s insight on using data to find deals and find out if self-storage is the right real estate investment for you!
How Sergio got into self-storage
- Built portfolio of small multifamily with wife while working W-2
- Became full-time real estate investor when daughter was born
- Anticipated market correction in 2018, pivoted to self-storage
What Sergio likes about self-storage
- Real estate investment and business with dynamic pricing
- Process and data-driven, allows for incredible efficiencies
Sergio’s approach to managing self-storage
- Self-managed at first to learn self-storage business
- Sites don’t need full-time manager, largely online business
How Sergio finds self-storage deals
- Full-time acquisitions team uses data to identify opportunities
- Relationship-driven, collaborative industry
Sergio’s self-storage market outlook for 2024
- Utilization growth, increasing housing costs good for self-storage
- Opportunities in markets that are 30% to 40% renters
The biggest challenges Sergio is facing right now
- Downtick in occupancy with fewer people moving
- Hard to find financing for self-storage deals
Sergio’s insight on the barrier-to-entry for self-storage
- Zoning = biggest obstacle
- $15M for ground-up development, $5M for existing facilities
What Sergio has learned from his biggest failures
- End up spending more when try to save money on contractors
- Lessons in bad personnel decisions, not selling at right time
Why Sergio invests in GoBundance
- Surround self with people who inspire him to be better
- Accountable for growth as leader and business owner
How Sergio’s definition of success has changed over time
- Wants to share learnings and inspire others to do well
- Includes being more intentional father, present with family
Connect with Sergio Altomare
Email [email protected]
Connect with Michael Blank
Email [email protected]