Commercial real estate offers diverse investment opportunities, especially when branching out from traditional multifamily properties.
However, many investors hesitate to explore nonresidential sectors, opting to stay within the familiar realm of multifamily. To shed light on this path less taken, we spoke with Ash Patel, a seasoned commercial real estate investor with 15 years of experience and fund manager of the Customizable Invest Beyond Multifamily Fund™.
Ash specializes in nonresidential properties spanning office, retail, industrial, flex, medical spaces and ground-up developments. In this conversation, he shares his journey from residential to commercial investing, his rewarding partnership with Avestor, and valuable advice for investors ready to diversify into commercial real estate.
[Ash Patel is an experienced commercial real estate investor specializing in nonresidential assets, including office, retail, industrial, and medical properties. With over 15 years in the industry, he advocates for "Invest Beyond Multifamily," encouraging investors to explore high-return opportunities beyond traditional multifamily investments. Partnering with Avestor has streamlined his fund’s operations, enhancing deal onboarding and investor engagement.]
The Shift to Commercial Real Estate
Ash’s entry into real estate began with a search for tax savings, a common goal among professionals.
“My wife and I were both W-2 employees, and every year, we’d go to our accountant asking how we could reduce our taxes,” Ash explains.
Frustrated by the lack of answers, Ash turned to real estate, a sector known for its tax advantages. His first purchase was a mixed-use building with commercial space on the ground floor and apartments above.
The experience led him to notice key differences between residential and commercial tenants. Residential tenants often required constant maintenance, while his commercial tenant invested in property improvements. This early experience sparked Ash’s interest in commercial real estate, leading him to transition fully to nonresidential properties.
Why “Invest Beyond Multifamily”?
Ash’s focus on commercial real estate grew into a philosophy he calls “Invest Beyond Multifamily.” Many investors view their path as moving from single-family homes to larger multifamily buildings. According to Ash, this mindset limits opportunities.
“People don’t think outside the box. I’ve had hundreds of conversations with people asking why they don’t invest in retail, medical, or office. Their responses often reflect a lack of knowledge or a preference for sticking to what’s familiar,” he says.
By exploring commercial real estate, investors can benefit from less competition and higher returns. Ash’s brand, “Invest Beyond Multifamily,” aims to encourage both operators and investors to consider commercial properties as viable, profitable alternatives to multifamily investments.
Early Commercial Investments and Lessons Learned
After his initial success with a mixed-use building, Ash quickly diversified into various commercial assets, including a vacant 15,000 square foot retail building and a half-built office structure that had been vacant for five years. He worked tirelessly to turn these properties around and secure tenants, learning valuable lessons along the way.
One key distinction between multifamily and commercial real estate, Ash points out, is the lack of a universal “playbook” for commercial investments. In multifamily, books and boot camps provide step-by-step guidance, making it easy for new investors to enter the market. However, this accessibility also leads to heightened competition, making it harder to find profitable deals.
In contrast, commercial real estate requires a customized approach.
“Every commercial deal is different,” Ash explains.
For example, managing a 100,000-square-foot strip mall involves unique lease agreements for each tenant, each with its own terms. Ash has learned that commercial real estate demands adaptability and hands-on management, as each property and tenant arrangement varies significantly.
Advice for Investors Looking Beyond Multifamily
For investors eager to diversify beyond multifamily properties, Ash suggests starting close to home with familiar assets. Two types of properties he recommends for beginners are mixed-use buildings and neighborhood strip malls:
- Mixed-Use Buildings: Ash’s approach with mixed-use properties is straightforward: ensure that the residential units cover all expenses, while the commercial space generates pure profit. This setup provides a safety net, as investors are likely familiar with residential units and can leverage this knowledge while gaining exposure to commercial assets.
- Neighborhood Strip Malls: Local strip malls, housing recession-resistant businesses like dog groomers, pizza shops, optometrists, and salons, offer stability. These businesses are less vulnerable to economic downturns and online competition, providing reliable tenant demand.
By focusing on these types of properties, investors can confidently enter the commercial real estate sector while managing risk.
Why Ash Patel and Investors Choose Avestor’s Platform
When Ash partnered with Avestor, it brought a new level of efficiency to his investment operations. Avestor’s Customizable Fund™ has streamlined deal onboarding, making it easy for Ash and his team to manage new investments and onboard investors.
Ash recalls an instance where a new hire, fresh out of college, managed to onboard a live deal within 15 minutes with no prior experience on the Avestor platform. “It’s just intuitive,” he says, highlighting how Avestor’s ease of use aligns well with his investment approach.
Ash Patel’s journey in commercial real estate reflects the potential of exploring nonresidential assets beyond multifamily properties. His success is grounded in adaptability, strategic thinking, and a commitment to educating investors about the benefits of commercial real estate.
Ready To Start Your Journey with Avestor?
Through partnerships like Avestor, Ash continues to grow his portfolio and help others discover the value in commercial investments. For those ready to step beyond the conventional multifamily path, Ash’s insights offer a compelling roadmap to success in the broader commercial real estate landscape.
To learn more about how Avestor can work with you to diversify beyond multifamily, schedule a free strategy call with our team at www.avestorinc.com/demo
