143. The Power of Cash Flow Investing with Charles Carillo

PassivePockets: The Passive Real Estate Investing Show

Wondering why you should avoid investing in D-class properties? Charles Carillo explains the challenges and risks associated with these properties. From ongoing tenant issues to higher maintenance costs, D-class properties require intensive management. Plus, Charles explains why you need to prioritize cash flowing properties that maintain their value even during market fluctuations. It's all about weathering the storm!

About Charles Carillo

• Charles Carillo, the managing partner of Harborside Partners, is an experienced real estate investor with a $200 million investment track record. Inspired by his father's involvement in multifamily properties, Charles began investing himself in 2006 and has since grown his portfolio with multifamily and mixed-use properties. He also hosts The Global Investors podcast, where he interviews other real estate professionals.

Here are some power takeaways from today’s conversation:

[04:17] Charles’ real estate investing journey

[07:36] What you need to know when dealing with D-class properties

[11:00] Real estate investing strategies and dealing with market changes

[16:39] Adapting debt structures

[20:01] What makes cash flow in real estate so desirable

[32:41] Capital calls in real estate investing

[35:42] Evaluating real estate syndicators

Episode Highlights:

[07:36] Why Avoid Investing in D-Class Properties

When dealing with D-class properties, expect ongoing tenant issues, higher maintenance costs, and declining neighborhoods. Financing can be difficult, and intensive management is required. Long-term appreciation may be limited in these areas. To mitigate potential risks, it is crucial to invest in higher-quality properties and adopt a conservative approach to financing. By doing so, investors can navigate these challenges and make sound investment decisions.

[20:01] The Power of Cash Flow From Real Estate

• Cash flow from real estate is highly desirable for several reasons. Firstly, it ensures the self-sufficiency and resilience of properties, enabling them to withstand economic downturns. Additionally, cash flow provides a consistent income stream, appealing to investors seeking reliable returns. Furthermore, properties with positive cash flow can be held long-term, benefiting from appreciation over time and generating capital gains. Moreover, cash flowing deals are less risky than those relying solely on appreciation, as tenant income provides greater security. Lastly, cash flow affords operators the flexibility to sell based on market conditions, maximizing sale proceeds.

This show is for entertainment purposes only. Nothing said on the show should be considered financial advice. Before making any decisions, consult a professional. This show is copyrighted by Passive Investing from Left Field and Left Field Investors. Written permissions must be granted before syndication or rebroadcasting.

Resources Mentioned:

Harborside Partners

Global Investors podcast

LinkedIn: @charlescarillo

Use this for book links: https://www.leftfieldinvestors.com/books/

Podcast Recommendations:

Macro Voices Podcast

Advertising Partners:

Left Field Investors - BEC

Tribevest

GSP REI

Spartan Investment Group

Rise48

Aspen Funds