One of the reasons I’m a Wall Street writer and soon-to-be four-time published author is because of some of the mistakes I made in my previous career.
Back in 1995 – over 28 years ago – I had a successful career as a real estate developer. I constructed buildings for many national retailers such as Advance Auto, Dollar General, and Payless Shoes.
I partnered with a financial heavyweight and believed I was on the right track to becoming one myself in the long term.
Unfortunately, I made a costly mistake that would defer that dream. Now, I make it my mission to ensure you don’t succumb to the same pitfalls.
At Intelligent Income Daily, we focus on delivering you the best strategies to secure safe and reliable income for years to come.
Today, I’ll share with you the story of how a fall-out from a seemingly ideal partnership left me broke, the strategies I used to amplify my wealth after, and an exciting way to do the same for your portfolio.
Whoever Has the Gold Makes the Rules
Shortly after starting out in real estate development, I built my capital efficiently.
By sourcing sites and constructing new properties, I was able to accumulate significant wealth for a partnership, in which I was the minority partner. But of course, the reason I was the minority partner is because the majority owner had most of the money.
As I realized, we live by the “golden rule”: Those who have the gold make the rules.
My business partner was wealthy (he had all the “gold”). So I had very little input into the management of the business. And although we were equal economic partners, he had voting rights when it came to the important business decisions.
As a young real estate developer, I was thankful to have a business partner who could flex his financial muscles at the bank, so I was not as concerned about voting rights.
However, as our portfolio grew (to around $75 million), I knew that it was going to be difficult to unwind the business when it came time to do so.
That time came around 2006. By that point, the one-sided decision making had gone too far.
I decided it was time for me to venture out on my own.
I had been planning to exit the partnership for some time due to a lack of trust in my business partner. In fact, I began moving boxes out over the weekend for several months, making sure nobody knew I was leaving.
I’ll never forget the Monday morning when I had already moved everything out of my office, and my partner walked in and acted surprised. But I think he knew all along.
And things did not end well.
He would not allow me to divide up assets… primarily because he was using the rent checks like his own ATM machine.
He had the power to make up the rules. So he was able to suck money out of the partnership. All my worst fears and suspicions became reality.
I found out a little too late that many of our properties had multiple mortgages (without my consent, of course).
One of my trophy properties worth over $12 million had a total of five mortgages on it totaling around $15 million. One of the lenders was charging an annual interest rate of 48%.
With five kids and multiple franchise businesses, it was very difficult for me to navigate the chaos, especially because I could not control this difficult business partner. It took years – almost an entire decade – for me to land on my feet.
One of the biggest lessons I learned from this is to never put all your eggs in one basket.
Enter Intelligent Investing
Over the last 13 years, I’ve gone from rich to poor to rich again. And part of my secret is that I’ve been able to create value from intellectual property instead of real property.
Our mission here at Wide Moat Research is to help prevent investors from taking on painful losses like the ones I endured. Our No. 1 goal is to protect principal at ALL costs.
So, you’ll never see me or any other analyst at Wide Moat Research go all in on one company. I had to learn that lesson the hard way, as I had most of my net worth tied up with one partnership with no way to liquidate my ownership stake.
Part of my successful pivot (from real property to intellectual property) is due to my firm commitment to diversification and insisting on asset-allocation targets.
The heart of the investment process lies in constructing a sound set of portfolio targets that promises the possibility of greater wealth accumulation.
So how did I turn things around? I used my experience to help others in my shoes.
And I began by reaching out to some of the CEOs I’d met over the years. This included some in charge of real estate investment trusts (REITs), corporate landlords that pay big dividends.
Those connections gave me a unique edge in the intellectual property arena I’d decided to break into. My insider’s understanding of real estate, from foundation to fulfillment, added another.
Next, I started writing and sharing these lessons I’d learned in articles featured in Forbes, Barron’s, Seeking Alpha, and more.
We’ve come a long way since then…
Today, I’m considered an expert in the income and REIT space. My team and I even launched an index devoted to REIT investments, the iREIT-MarketVector Quality REIT Index, last week.
And it’s all thanks to the tough lessons I had to learn about diversification, risk management, and asset allocation.
That’s why I’m always excited to tell folks about Intelligent Investor Income. It’s the strategy I used to go from broke to wealthy.
This service contains a full portfolio of income-focused investments. Thanks to the recent market downturn, almost all of them – over two dozen – are actionable immediately.
To find out more about this service and how you can access this portfolio, check out my video presentation. In it, I share the name of one of my favorite REITs right now in this market. You’ll get that name – free – just for watching.
Here’s the bottom line for you today: It might feel like it’s tough going at times… But you shouldn’t let your past mistakes define you. Instead, you can use them as the foundation to building back even stronger than before.
As long as you can keep intelligent investment decisions at the center of your wealth-building focus, you can attain your financial dreams once again.
Happy sleep well at night (SWAN) investing,
Brad Thomas
Editor, Intelligent Income Daily