Introduction to Real Estate Investing: A Personal Approach
I was born in Budapest, Hungary, to a German mother and a Chilean father, and I gained Chilean citizenship in 2005. Through my family's long history with property investment, starting with the initial family office business in Switzerland in 1955, we have continuously been involved in various types of projects, including commercial, industrial, development, and residential property. Our New York City subsidiary has been operational since the 1970s.
A 2020 Pandemic Opportunity
In 2019, one of my Chilean CEO friends informed me that he had two buildings in Santiago de Chile's Centro district, both with underground parking spaces and offices. By 2020, during the pandemic, there was a significant drop in office occupancy. I saw this as an opportunity to transform the offices into 2 small apartment units equipped with a kitchen and bathroom.
With the end of winter approaching and the onset of spring and summer, these spaces can be listed on various accommodation websites to attract tenants. I hired a marketing team and my nieces' and cousins' children to manage customer inquiries. This was a unique, counterintuitive real estate investment tip that paid off.
Observation: Best Deals Often Come from Less Than Ideal Parties
Not exactly a tip as much as it is an observation: as a buy-and-hold investor, the best deals we have done with my wife have often been with the 'worst' people. The rationale being that smart people do not sell great deals. Instead, opportunities arise when dealing with individuals who are disorganized, defensive, or over-ambitious in personal benefits.
Our most successful office building acquisition, for instance, was complicated by the seller's insistence on personal tweaks to the agreement and attempts to avoid tax obligations. This made the transaction lengthy and fraught with issues. However, despite these difficulties, the seller then squandered the proceeds, leading us to purchase the second building soon after due to the seller's financial issues.
Unfortunately, the pattern of this investor persisted, and we had to cease working with him. Interaction with such individuals requires patience and temper management, and we do not have endless capacity for either.
Conclusion and Guidance
Patience and clear assessment are essential when delving into real estate investment. Understanding that the best deals can sometimes come from the most challenging and unconventional partners is a valuable lesson. Always be prepared for the unexpected and ready to work with less than ideal individuals if their assets align with your investment strategies.
Keywords: real estate investment, buy-and-hold strategy, unconventional investment lessons