The Secret Rental Strategy That Doubles Your Income

The Real Estate Investing Club

Join an active community of RE investors here: https://linktr.ee/gabepetersen  0:00 - Welcome to The Real Estate Investing Club 1:06 - Angela Healy's Real Estate Origin Story 2:31 - What Are Fully Furnished Midterm Rentals? 4:15 - How to Choose the Right Market for Corporate Housing 7:31 - Setup Costs and Furnishing Requirements 8:44 - Rental Premiums: How Much More You Can Charge 14:04 - Finding Corporate Tenants and Best Platforms 17:20 - Market Trends and Future Opportunities 22:09 - Lessons Learned and Advice for New Investors 23:05 - AI Tools for Real Estate Investors  🏠 The Secret Rental Strategy That Doubles Your Income  WHAT IS A FULLY FURNISHED MIDTERM RENTAL?  If you've been searching for a smarter real estate investing strategy with higher income and less operational headache than Airbnb, this episode is for you. Host Gabriel Petersen sits down with Angela Healy, CEO of Avenue West — a corporate housing company operating since 1999 — to unpack the world of fully furnished midterm rentals, a powerful and widely overlooked niche in real estate investing.  Unlike long-term rentals where tenants supply their own furniture, or short-term vacation rentals where guests rotate every few days, midterm rentals sit in the sweet spot between the two. 🏡 Fully furnished and move-in ready — internet, streaming, linens, all included — these units are leased to corporations housing relocating employees for an average of about 99 days. That means roughly four tenant turns per year, far fewer headaches than a vacation rental, and significantly higher rent than an unfurnished unit.  HOW MUCH MORE MONEY CAN YOU MAKE?  The numbers are compelling. In Denver, a one-bedroom condo renting unfurnished for $1,800 to $2,000 per month can command $3,500 to $4,000 per month as a corporate rental.  FINDING THE RIGHT MARKET AND PROPERTY TYPE  Ideal markets have a diverse mix of corporate employers across tech, healthcare, oil and gas, and manufacturing. Denver is highlighted as a proven midterm rental market, while Abilene, Texas is emerging as a hotspot due to a manufacturing investment boom. 📍 About 70% of midterm rentals are one-bedroom condos or apartments, but single-family homes also work well for executives relocating with families. Prioritize Class A properties with doormen, fitness centers, pools, and controlled access — the amenities corporations expect when paying top dollar.  #RealEstateInvesting #MidtermRentals #CorporateHousing #PassiveIncome #FinancialFreedom  Want to learn more about our guest? Connect here: https://avenuewest.com/  Want to learn more about the REI Club Podcast, how to invest with Gabe at Kaizen, or join our community of active real estate investors on Skool? Visit the podcast website at https://www.therealestateinvestingclub.com or click here: https://linktr.ee/gabepetersen

Transcript

00:06all right we are back yet again with another episode of the real estate investing club

00:11it actually just started uh peeking out some sun here in where i live here in tacoma

00:17and whenever there's sun during you know january february it is a day to celebrate because we don't

00:23get a lot of sun up here in seattle so i'm feeling i'm feeling good and i hope you guys

00:27are feeling good too um it's a good day for a second reason though because we have angela healy

00:32with us on the show from avenue west and this is a unique uh a unique episode because rarely do

00:39we

00:39have somebody on who talks about a an investing strategy that has not been talked about before

00:44we've had you know 600 plus guests on the show we've covered every top topic you know you name it

00:50people flip farms people you know throw term rentals self-storage mobile home parks we talk about it all

00:55but we've never had somebody on to talk about fully furnished rentals and so that is something

01:00a unique strategy um that we haven't talked about and i'm excited to jump into it so

01:04angela thanks for hopping on great thanks so much for having me game i'm really excited about the

01:08conversation absolutely um i told you before we got on here we always like to start with stories we

01:15like to hear how people got to where they are so why don't you take us back to the beginning

01:19of

01:19your story in real estate and tell us how you got here well my parents um started with long-term

01:25rentals um when i was about seven years old and they were able to put four children through private

01:32college um and it really was an additional income stream to the family um above and beyond the jobs

01:38that they had um and so i knew very young that i wanted to get into real estate um whether

01:43i would

01:43do it right away or not um i started my career in commercial lending um but then eventually worked

01:49my way back um and and found myself back in real estate so nice i love it so you had

01:56a little bit

01:57of of um exposure to real estate with your parents and now uh now you got into it full-time

02:02um so let's just talk about you know what's what the main topic here today fully furnished rentals

02:08that's unique because generally people either um and sorry i i forgot to clarify you guys at the

02:14beginning fully furnished long-term rentals and so usually you think of a fully furnished rental you

02:19think of airbnb short-term people coming in one weekend leaving the next week or the you know on

02:24monday um or you think of you know your long-term rental where you get an empty house you got

02:28to

02:28bring your own stuff into it that's not what andela healy does so tell us why why this strategy what

02:34kind

02:34of brought you to it sure so this is a little bit we we refer to ourselves as midterm rentals

02:40um that

02:40seems to be the the name coming through and um it's fully furnished rentals um so like an airbnb

02:47in terms that all the furnishings the cable the internet you know everything is there um when they

02:53walk through the door so all they have to bring is their luggage um but we're really providing this

02:58service to corporations that are relocating people or they're bringing people in on assignment so

03:05they're here longer than that kind of short you know hotel stay um but not so long that they would

03:12need to have an unfurnished rental or maybe they use our midterm rental as a landing base and then they

03:19would find their permanent housing whether they buy or rent um after the corporation provides them with

03:26an initial midterm rental stay to get them acclimated and um go ahead and one of the reasons that i

03:35think

03:35um it's a little bit overlooked people really look at real estate in either terms of airbnb

03:42vacation rental or they look at it as long-term unfurnished and especially with a lot of the changes

03:48that we're seeing with regulations in specific cities where they're really clamping down on your ability

03:54to do airbnb rentals it's a nice um kind of midway shift you don't have to get rid of all

04:00the furniture

04:00you don't have to um really turn your property back into an unfurnished rental there's another option

04:08out there for you if your laws are changing um if you are in the right area that that is

04:13the main

04:14piece not every property is good for midterm rentals yeah and that was actually going to be my

04:21my first question after um after that is how how do you define your your buying criteria like where

04:29are you looking what what area is is ripe for midterm rentals so you really need to have a good

04:36number of corporations in your area that would provide this housing for their employees so you

04:42don't necessarily want to be completely reliant on one company because what if that company decides

04:47they're doing a layoff or something so you want to make sure you're insulating yourself from some of

04:53the economic cycles that different um industries or companies can go through um so if you have um a

05:01nice center of business um i happen to live in denver so i'll use denver as an example you know

05:07we have

05:07a lot of different types of businesses here um whether it's tech or oil and gas or health care

05:13you know there are a number of companies here that would use corporate housing for their employees

05:18or consultants coming in on assignment um so we have a good base of companies to start with then

05:24what specifically are they looking for traditionally about 70 percent of midterm housing is a one bedroom

05:32one bath apartment or condo or something like that um and the traditional corporate housing model

05:40is a corporate housing company would come in and set up an apartment for that person what avenue west

05:46does we do it a little bit differently because we are are a real estate agency we're managing other

05:51people's properties we look at it in terms of a condo or a townhome you know or something that would

05:57be less transient than an apartment um and we set the entire property up with our investors um so that

06:04then we're just kind of turning the employees after that so our average stay is about 99 days

06:10so we're doing about four four turns a year within a property um and then you're looking for kind of

06:18a

06:18class a corporations are paying top dollar for the property so they want it because they're trying to

06:24make the impression for their employee number one they are concerned about safety because they're

06:30responsible for that employee while they're staying with them um so you're looking for a building that

06:36has a doorman or 24-hour security or fob controlled access um but then they're also looking for amenities

06:43does it have the pool does it have the gym you know is it a full service property real quick

06:48so you

06:49are everything you mentioned so far it sounds like you're looking for condos so you are not looking

06:53at um single family homes here well that's not true um so i said 70 percent of our properties

06:58are um are one bedrooms um and then we also have to have the two bedrooms and the homes

07:05and if you if the majority of your investors are um investing in single family homes then you're looking

07:11for um the homes where you would be relocating executives with families so then you're talking about

07:18what school district do they want to be in and things like that um and so really being able to

07:24provide

07:25that property that the executive would be looking for um that would be like an of like property to

07:33what they had in their prior location and so what um when you're talking about you know setting thing

07:39up setting things up as a furnished rental um there is a little bit more capex in there in that

07:44you're providing the furniture um i'm how much does it generally take like what what level of furnisher

07:50and furnishings are you bringing to the property uh to get it to where you need it and how much

07:54does

07:54that generally cost yeah so you do want to remember it's still a rental so on a one-bedroom

07:59condo we're probably looking at ten thousand in capex to get that up and going on a three-bedroom

08:05depending on the square footage um you're probably looking in the terms of twenty thousand

08:10oh okay ten thousand for a one bed that's not bad this is interesting because you i um

08:16i rarely talk to investors who like condos those are that it's just a strategy that nobody tends to

08:22i've never invested in one myself and i just haven't heard of a lot of people who like them

08:26at all yeah because it's hard because you have the hoa dues and that's an additional expense that you

08:32wouldn't have somewhere else right and that really cuts into it but it sounds like this might uh compensate

08:38for that additional expense that you have um but it really does come down to you like what what can

08:43you rent these for above what you'd rent you know just your standard single family for like

08:48what kind of premium can you charge for these furnished rentals so i'm going to use the one

08:53bedroom as an example because that's what we do most of um if you are purchasing a one bedroom in

08:59um

08:59in denver it's you're probably going to rent that unfurnished between eighteen hundred and two thousand a

09:04month there are from from an unfurnished for unfurnished okay so um yeah when we're looking

09:15at um furnished with the corporation we're probably looking at thirty five hundred to four thousand a

09:20month oh okay yeah so there is this market for the right property has to be the right property not

09:28every property will will match what they need but it is the sweet spot for that particular property

09:34to rent it as a corporate rental um because what you're going to get unfurnished is nowhere near

09:40enough and then what will you be able to do it as an airbnb you're not sure but if you

09:45are in an area

09:46um where you can do it as an airbnb you know your vacancy factors and things like that might

09:52drop into that um rate and it typically will will work out better to be a midterm rental for the

09:59right property yeah and well an airbnb just the the the operational headache that goes into those

10:05again i i'm speaking out of turn we buy mobile home parks rv parks self-storage facilities and so i

10:10don't have experience with short-term rentals um and so but as i understand it uh short-term rentals the

10:16operational headache is on the extreme end um you get people texting you all the time yada yada

10:21but if you're doing it this way you're you know you're only really turning it you know four times

10:26a year you said about three months about four times a year exactly so it's not it's not that horrible

10:32but you are still taking part of a considerable amount of upside that you would expect from an

10:39airbnb so i i love it um it does come down oh sorry keep going the other piece of it

10:46is because the

10:47corporations are paying top dollar you do need to provide them with excellent service so if something

10:54does break and heaven forbid it's the internet you don't want the internet to go out um you've got to

11:01be in there to repair it very quickly um for them that's the expectation of the dollar amount that

11:06they're paying so while you don't necessarily have the operational headache of turning the property and

11:12getting it ready or someone had a party or you know all the things that come with the airbnbs um

11:17you do

11:17need to be kind of that johnny on the spot okay let's give them the customer service that they're

11:22looking for that makes sense that makes sense um what is the opex ratio that you're generally running

11:28at for these um i don't know if i know that right off the top of my head um but

11:36we um you know most

11:39most of our investors when they're looking at it from an roi perspective um we're really looking

11:47we need more information from them in order to get them their roi you know what are you putting down

11:52what are you you know all of the pieces and so i guess really my question is around so you

11:57know if

11:57you do a single family rental um your your expenses monthly expenses are going to be things um you know

12:04you're not going to be paying for the electrical bill you're not going to be paying for uh the water

12:08all these are the things that the the tenant is going to be responsible for but i'm assuming with

12:12this model you are responsible for all of everything um you're responsible for the internet

12:17you have to have internet for them you have to have cable bills for them you have to have all

12:21these

12:22additional expenses that are put on top of um you know on top of what you would generally pay for

12:28your your single family rental so i'm just trying to understand like what is the margins that you see

12:34on these type of uh these type of investments yeah so when you're looking at um providing the overall

12:41package and we're doing things to streamline it most people are using streaming now instead of cable

12:46so as long as you have the very fast internet and the right tvs you know we're doing things to

12:51try to

12:51keep those rates down and then in some of the yeah exactly and then um some of the hoas include

12:59high speed internet in the hoa fee so in that case you have that piece as well and and some

13:04of the hoas

13:05include most of the electric as well and a lot of the high-rise buildings don't have gas so um

13:11so some of

13:12those expenses can be pretty minimal um when we're looking at a single family home though because we do have

13:19homes in our inventory um that are in the right area um you know we could be looking significantly

13:26higher in the price point so you are responsible for all the yard maintenance or in a place like

13:32colorado the snow removal um all the way down to your exterior maintenance which you would have anyway

13:37as far as exterior maintenance but the water and the electric and the cable some of that is um capped

13:44in terms of usage to avoid abuse um and um and then but on a single family home whereas

13:55you know we're usually looking at about twice as much as you would get from an unfurnished perspective

14:00for a furnished perspective um but then you do have those fees that you're going to need to back

14:06out and that's going to depend on the property yeah and where it's located yeah i mean yeah it still

14:11sounds like uh like a great deal um the other question that kind of comes to my mind is uh

14:15how do you

14:16film um you mentioned corporates corporate or corporations multiple times so i'm assuming that uh you're not

14:22you're not waiting for zillow rentals or whatever um so to fill your units you're actually actively

14:29going out going to microsoft being like hey we got these units we'd love to fill them with your uh

14:35new hires or whatever it is that you've got coming into town absolutely i have a whole separate team

14:40um that works on the properties and then i have a whole separate team that works on the corporate

14:44relationships um and avenue west has been in business since 1999 um and we have a lot of strong

14:50customer um relationships already with a lot of the corporations in our areas and territories

14:56and then we're constantly out looking for new rfps that we can bid on um the important thing there is

15:03is the larger companies that you get to um they're looking for maybe one or two providers to be able

15:09to

15:09provide all of their housing needs so if i was an investor that had maybe one property that's going to

15:16be

15:16pretty difficult to get microsoft to um to rent my one property you're going to need to go through

15:22an intermediary and find a corporate housing company that has those relationships and be able to

15:27provide those tenants to you you can go on furnished finders and corporate housing by owner and different

15:34places um and list your own property and you can be very successful with that the real margins that

15:40we're talking about um are going to come from the even larger corporations so you will need to pay a

15:46property manager to get you to that relationship but in a lot of cases doing it yourself would yield

15:54x and doing it through like an avenue west will yield y but even minus the commission you're paying me

16:00you're still making more yeah yeah i mean that makes a lot of sense you said rfp there and i'm

16:06like okay

16:06so this is this is a little bit different of a process so these uh it makes total sense these

16:11corporations they don't want to um have a million negotiations with a million different owners and

16:17so they want to centralize it they want to talk to one person um and and yeah that makes a

16:22lot of

16:22sense to me but you did mention two platforms that are out there for people who uh if they do

16:27have

16:27one unit they don't want to go through a property manager they can't access these uh these resources i

16:32think you mentioned furnished finders and then one i hadn't heard of before which is corporate

16:35housing by owner is that yes um corporate housing by owner.com um they post owner uh owner owned

16:43properties um renting for 30 days or longer um and they go out and participate and try to get

16:50corporations to book off of their platform um the same way kind of furnished finders would do with

16:55the traveling nurses and traveling doctors got it cool well awesome this is uh this is really cool

17:03stuff again this is not a topic that we have talked about we might have talked about it once before

17:07but i feel like it's it's a very unique topic for here on the show it is i love love

17:11to hear it um so

17:13what do you guys see in terms of opportunities in the next couple of years do you see any specific

17:20metros any any trends um that are affecting this uh this type of strategy yeah so what we're seeing

17:27right now is a return to manufacturing in the united states which is bringing a considerable

17:31requirement for corporate housing um in some smaller cities um i know i had talked about originally

17:37you know if you're an investor with one property maybe you want to focus on a city that has multiple

17:43companies in it um but there are opportunities um like abilene texas right now is in the middle of a

17:50boom um you know different areas where they're bringing manufacturing into the area where they're doing

17:56construction then they're going to have the actual plant after the fact um so there there are these

18:02pockets of areas where the corporate housing is going to be pretty significant um and then

18:08health care is always a big user of corporate housing and health care is in you know just every city

18:14so um so you have that and then technology while we're seeing some of the ai piece kind of scaling

18:22back some of the corporations once i think that funnels through they're still going to be using

18:27corporate housing in the long term so um and and this strategy isn't necessarily oh let me put all my

18:34eggs in this basket it's kind of like stocks and bonds and you know when you're looking at your total

18:38portfolio do i have a piece of property within my portfolio that its highest and best use would be

18:47this midterm rental and maybe i should find um a solution for that particular property yeah well

18:54yeah and like i said earlier the thing that screams to me is condos um you know so many times

18:59i've heard

18:59people who own condos and they're like it was the worst investment ever it sounds like this is a this

19:03is a great um great use case for for uh to turn your condo into a real investment that has

19:09a good return

19:09for you and we find that a lot as an accidental landlord like they own the condo when they're young

19:15and then they finally get to the point where they're going to go and purchase their own home

19:20don't sell that condo especially if it's at a three percent interest rate right don't sell that condo

19:25turn it into something else and if you can't make it cash flow as a long-term investment maybe

19:31the midterm rental is the way to go there you go all right well i just took a peek at

19:37the clock we

19:37have run it down so it's time to jump into the quick question around are you ready

19:42all right it starts with education could be any form could be a book you've read a movie you've

19:47seen conference you've gone to mentorship program you've been a part of i just need one recommendation

19:52that you can give people to help further their real estate career um you're talking about mentorship

19:58program um i am a part of a ceo group so um either get into young entrepreneurs vistage but being

20:05in

20:05a ceo group i think is the most important thing i've ever done nice i love it all right uh

20:11next

20:12question is for your younger self so if you could go back to the angela who was just getting started

20:17so many years ago go back to her look her in the eye give her one piece of advice moving

20:21forward

20:22trust my gut sooner nice and i will put that in the same bucket as i wish i got started

20:29sooner

20:30whenever anybody mentions that like 95 of the guests who come on say that that some version of that

20:35kind of advice um and whenever whenever somebody says that i always want to point it back to you

20:40the listener if you've not gotten a deal done just get it done just get it done go out there

20:45buy a

20:45piece of land buy a single family buy a condo turn it into a midterm rental but get something done

20:51um so

20:51you can get that ball rolling 10 years down the line you're going to be happy you did it today

20:55versus

20:55a year from now yes all right uh next question is about the u.s it's a big place there

21:02is a lot of

21:02opportunity out there give me the single metro you're most excited about investing in today

21:08um right now abilene texas is um is booming it's in the middle of nowhere it has no infrastructure

21:15nothing yet but it is everything is going there right now so if you want to get in on the

21:21ground

21:21floor it's funny you say that i uh i was under contract to buy or at least that we were

21:28in due

21:28diligence to buy an rv park out there and uh i didn't like the area i didn't i just there

21:34was

21:35something it was so up and down a bus and boom and it was like negative net growth or on

21:40this one

21:40report that i did and i just got just didn't feel like it was a good area to invest oh

21:45you're saying

21:45it's blowing up so maybe i made a mistake that's okay go back and look at it again it's not

21:50too late

21:51all right next question is about uh lessons learned not every deal we get into goes the

21:59way we expect it in fact pretty much every time something's gonna go wrong gonna go wrong and

22:05that's when we get to learn a lesson so um go back to one one property one deal that you

22:09did

22:09that went a little bit sideways and then what was the lesson you pulled from it yeah really the lesson

22:14was being able to be adaptable don't be so stuck in your original idea or goal for this particular

22:21piece that you don't look at what are the other things on the sidelines and um because you can turn

22:27something that is going bad into something completely different than what you were expecting

22:31and turn it into something good or salvageable i like that be adaptable and uh just keep going

22:38you're gonna get hit in the face it's gonna happen yeah the winners are the people who just figure

22:43out the the next solution all right uh next question is about um we're gonna kind of add in a

22:51different question here something we don't uh we've been adding in more and more um as i am

22:56becoming more and more a proponent of ai um i'm a huge fan of it i try to implement it

23:01in as many places

23:02as i can um so the question is how do you implement it in your own business and how can

23:07you suggest

23:07people do it for theirs um the biggest game changer for me was email um fixer um i highly recommend

23:15it

23:15um i've had my same email address for over 25 years so you can imagine what kind of spam and

23:20all kinds of stuff that i get but in addition it organizes it in terms of the priorities one through

23:27five and um and i found it to be very accurate very quickly and it adapts from what i what

23:33i do if

23:34like it moves stuff around it adapts to it so i definitely recommend that is this an actual like

23:40ai tool that someone built that you like connect it to your email and it just does it for you

23:45yes

23:46really yeah and if you want it will even start replies um based on stuff that you have written

23:52in the past um it will even start replies um and um but it has been a game changer for

24:00me email

24:01because everyone assumes the moment you get an email you've read it and i probably get about a

24:06thousand email a day so i have not received it the moment you sent it and um and so this

24:14really helped

24:15prioritize you know what was important which ones did i need to look at immediately and um and which

24:21ones could wait just a little bit longer that's pretty cool i was actually thinking about that yesterday

24:26um you know as as an active investor someone going out there doing deals the i was thinking

24:32or somebody asked me i can't remember how this popped up but i was thinking about like what is the

24:38actual you know the job of being an investor and i was i was just thinking like it's mostly email

24:42like most of what i do is you know and so uh if you if there's a way to improve

24:48that and to kind of

24:50cut through on the email or cut down on the email that is a huge huge lifesaver what's the what's

24:56the

24:56name of the tool you use it's fixer f y x e r f y x e r interesting i'm

25:02gonna look into that maybe

25:03i'll test it with one of my i've got like a million inboxes maybe i'll test it with one of

25:07my one of my

25:08lower email boxes and see i don't think you'll go back i love it i love it all right uh

25:14well that

25:15leads us to the very last question this is for the listeners you've given us a lot to think about

25:19i'm sure people want to reach out get in contact with you this is a two-parter where can they

25:23find

25:23you and then what can they expect when they reach out so um avenue west.com um is our email

25:29is our

25:29web address and my email is angela at avenue west.com or angela healy on linkedin those are the best

25:35ways

25:36to get me perfect i will put that in the show notes so if you guys want to reach out

25:40just click the

25:40little more in the description it'll pull down that full description and in there you can find angela's

25:45links perfect thank you so much absolutely for everybody who's with us today thank you guys for

25:51showing up you are the reason we do this so if you guys have any questions whatsoever reach out to

25:56me

25:56gabe at the real estate investing club.com if you guys want to support the show just leave us a

26:00review

26:00or a comment anything like that other than that i hope you guys have a great week keep rocking real

26:05estate and i look forward to seeing you on the next episode

26:09you

26:12you

26:13you

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