We believe now is the time to reduce investment risk.
We are watching several key economic headwinds that could tip the US into a recession:
The US is almost 10 years into the second longest expansion in US history. Like many investors, we do not believe growth will continue indefinitely
“Street Inflation” which includes housing, healthcare, and education, is rising rapidly putting many households under pressure. The ‘American consumer’ is stressed and many not be able to rescue the economy with continued credit card spending
The labor markets are at full employment which is a good thing for workers but can also ignite cost-push inflation because labor is a major part of all domestically produced goods and services (housing, healthcare, education, professional services)
Changes in monetary policy is one of the biggest threats to the economy, including: the speed of interest rate increases, changes in the Federal Reserve’s quantitative tightening, or even variations in the Fed’s forward guidance
To protect against these risks we are positioning our capital in:
Real estate with a low correlation to market volatility
Institutional-grade commercial properties that are stabilized and cash flowing
Properties with value-add potential where we can improve the property, grow the NOI, and force appreciation versus relying on natural market appreciation or cap rate compression
Housing that is priced and located for the working-class family and individual
A diversified number of properties, cities, regions, and states
Partnerships with best-in-class real estate operating partners to manage and optimize the day-to-day operations of our assets
Three unique asset classes: Mobile home parks, self-storage facilities, and workforce apartments