Distressed hotels might seem like eyesores to some, but innovative real estate investors see them as opportunities to create purposeful properties. In this episode of Zen and the Art of Real Estate Investing, Jonathan interviews Alex Cartwright, the Department Chair of the Management Department at Ferris State University and Principal at Hotel SHIFT, a company specializing in converting hotels into apartments. Alex, an economics professor, shares his experience with this unique investment strategy.
In their conversation, Jonathan and Alex delve into Alex’s path into real estate, which began in graduate school. They discuss the concept of generating alpha in real estate, how the field allows for control over your financial destiny, and why Alex advocates for house hacking to his students. The conversation also covers the types of clientele attracted to upscale multifamily properties, the benefits of renting versus buying, and the importance of making decisions based on practicality rather than principles. Alex shares how his disinterest in traditional apartment buildings led to the creation of Hotel SHIFT, underscoring why hotels are excellent investments and why converting them is more practical than other commercial spaces. They also touch on the ideal size and features of hotels for conversion, the importance of prioritizing occupancy over rent, and what limited partners can expect when investing with Hotel SHIFT.
You’ll hear more about the following points from Jonathan and Alex:
- Hotels are easier to convert into apartments than other commercial spaces because of the existing plumbing. They’re also usually located in desirable areas.
- Hotel SHIFT focuses on creating studio apartments, which are affordable, efficient living spaces.
- Investing in hotel conversions often offers higher potential yields due to the value-add created by converting them to apartments.
Hotel conversions offer a wide blue ocean of opportunity, and Alex Cartwright is eager to share this strategy with you.
If you want to learn more about Zen and the Art of Real Estate Investing Podcast, check out https://zenandtheartofrealestateinvesting.com/podcast/156/.