BiggerPockets Real Estate Podcast

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545: Self Storage Investing and Avoiding “Monster Houses” w/ Sergio Altomare

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Dec 16, 2021

Guest

Sergio Altomare

Sergio Altomare, a seasoned real estate investor, dives into the lucrative world of self-storage. He shares his journey from struggling with a problematic 'monster house' to successfully managing a $40 million portfolio. Listeners will learn the pitfalls of zoning laws and the unique strategies for increasing property value in self-storage, like optimizing rental rates and adding modern features. Sergio also discusses long-term exit strategies and offers insights on raising capital, making his expertise invaluable for both novice and seasoned investors.

01:18:45

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ANECDOTE

Zoning Issues

Sergio Altomare bought a duplex that wasn't zoned as a duplex.
After facing complaints and a denied zoning change, he sold it to a flipper.

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ADVICE

Zoning Verification

Verify proper zoning before buying a property, even in lenient areas.
Non-conforming properties can cause future issues and devalue your investment.

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ANECDOTE

Selling for Growth

Brandon Turner recently sold his first duplex, the "Kurt Cobain house".
Despite consistent cash flow, selling can free up mental energy and allow for bigger investments.

Get the Snipd Podcast app to discover more snips from this episode

Exploring the World of Self-Storage and Multifamily Investments

01:45 • 2min

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Kickstarting Your Real Estate Journey with Essential Tools

04:01 • 3min

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Journey from Tech to Real Estate Success

07:11 • 25min

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Mastering Real Estate Investment Dynamics

31:46 • 7min

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Navigating Self-Storage Investments Post-COVID

38:35 • 21min

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Navigating Self-Storage Acquisition and Negotiation Strategies

01:00:05 • 5min

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Transforming Self-Storage: Strategies for Success

01:04:40 • 14min

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Traction

Get a Grip on Your Business

Gino Wickman

In Traction, Gino Wickman provides a systematic approach to achieving business success through the Entrepreneurial Operating System (EOS). The book focuses on six key components: Vision, People, Data, Issues, Process, and Traction. It helps business leaders clarify their vision, align their leadership team, solve common business problems, and foster healthy communication and discipline within the organization. The EOS system is designed to help businesses overcome frustrations such as lack of control, people issues, insufficient profit, hitting the ceiling, and feeling stuck. The book offers practical tools, real-world examples, and actionable strategies to drive sustainable growth and improve business operations.

Who Not How

Dan Sullivan

Benjamin Hardy

In 'Who Not How', Dan Sullivan and Dr. Benjamin Hardy introduce the 'Who Not How' framework, which challenges the traditional 'how' mindset by encouraging readers to ask 'who' can help achieve their goals. This book teaches how to delegate tasks effectively, find experts who can handle specific challenges, and create transformational relationships. By adopting this mindset, readers can free up time, build supportive teams, and achieve their biggest goals while maintaining personal freedom and reducing burnout.

The only woman in the room

Eileen Pollack

Eileen Pollack's "The Only Woman in the Room" is a memoir that delves into her experiences as a woman pursuing a career in theoretical physics. The book vividly portrays the challenges and isolation she faced as one of the few women in her field. Pollack's narrative highlights the subtle and overt forms of gender discrimination she encountered, from discouragement from professors to the lack of mentorship and support. The memoir offers a powerful and insightful look at the systemic barriers women face in STEM fields. It serves as a testament to the resilience and determination of women striving for success in male-dominated environments.

Principles of real estate syndication

Samuel K. Freshman

Principles of Real Estate Syndication by Samuel K. Freshman is a definitive 'how-to' book that provides easy-to-understand insights into real estate syndication. It covers vital topics such as types of syndications, leverage, risks, and tax considerations, making it applicable to various business sectors. The book includes extensive glossaries and an appendix of relevant rules and forms, offering a thorough understanding of syndication principles.

Sergio Altomare didn’t start out investing in self storage. He made a massive leap, making lots of mistakes along the way until he found this gold mine of an asset class. For years, Sergio was buying small multifamily properties, one of them being a “monster house” which he later had to sell due to some serious zoning issues. Once he was introduced to syndications, he knew he could take his portfolio higher, without the headaches of large multifamily.

Now, Sergio has twelve self storage facilities, with a combined valuation of close to $40M. He’s been able to increase his equity by many, many millions with simple value-add strategies like increasing rent, paving parking lots, and installing key-accessible gates for his customers. This isn’t the regular value-add you’re used to with granite countertops and freshly tiled showers; self storage value-add can be minimal with massive results.

Sergio also dives into his long-term exit plans—something every investor should be thinking about. Are you planning on selling your properties one by one to the highest bidder, or will you package them up and walk away with a huge payday?

In This Episode We Cover:

What a multifamily “monster house” is and why you should avoid them

Zoning laws and how they can affect your long-term profit

The pros and cons of investing in self storage facilities

What to look for in self storage facilities and other types of commercial real estate

How to raise money for your deals (even if you’re a new investor)

Defining your exit plan so you can walk away rich after building your portfolio

And So Much More!

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