How to invest during a recession

Despite the doom and gloom that surrounds the word recession, times of economic turmoil can actually present some of the most lucrative opportunities.

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I say this with personal experience behind it. Sitting on the sidelines now will cause you to miss out on benefits later on — this is what happened to me me during the Great Recession. I lost a lot of money because I didn’t act upon the circumstances at hand.

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This was not the case during the mini recession of 2016. I invested even more aggressively than I was already, and walked away with massive returns on the investments I made during this time.

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What I’ve learned is that this is the moment to capitalize upon the carelessness of others.

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It all comes back to flex space

During the last recession, my flex spaces were 100% occupied, with waiting lists to boot. Manufacturers with extremely large warehouses who no longer needed them — or couldn’t afford them — because of the economic downturn ended up moving into flex spaces. Even in situations that presented dire straits, flex spaces remained in demand, and therefore, profitable.

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Of course, one of the biggest concerns for anyone in real estate going through a recession is the question of continued rent payments. Due to the surging demand for flex space, I have yet to run into this issue myself.

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However, even if this situation was to present itself, it will prove to be a nonissue. If a tenant finds themselves unable to pay, we can simply forgo the boilerplate in the lease. Within 30 days, we’ll have the space leased out once again — it really is that simple.

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In fact, this can be even more advantageous in some cases. If a tenant moves out, a new tenant will likely be willing to pay even more because of how sought after flex space is for their business.

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Play the long game to get the best ROI

With flex space, you can develop far more property over time than with multifamily, with far fewer headaches. You can automate more of the business, and enjoy having professional tenants.

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This frees up your time to focus on expansion. You can have one manager looking after your existing property while you develop new ones.

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Remember, the demand for flex space is surging. And current trends in e-commerce maintain the theory that businesses will continue to require flex space to meet the needs of their customers. This is why I can feel confident investing into more property and developing these spaces at a breakneck pace. People need these spaces now, and they’ll certainly need them when the economy has recovered. When that time comes, I’ll be thanking myself for weathering the storm.

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The takeaway

Learn from the mistakes that I — and so many others — have made. Instead of fearing the unknown, take calculated risks and be willing to go where the general population won’t. We are now being presented with an opportunity that can be capitalized on several times over.

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If you want to get into the fine details of how I’m going to turn the recession into my unofficial business partner, let’s talk it over at Flex Space Untapped. I’ll be laying out my plans and showing you how you can turn these next few years into the best ones of your life.

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