Updated: 6 days ago
In this episode Aaron Fragnito explains how Peoples Capital Group is opening short term rental investment opportunities to qualified investors in their network. Aaron explains why PCG is expanding into a new market and how passive investors partake in these private offerings to earn strong cash flow and free vacation weeks! Listen to learn more about how short term leasing works and the benefits for passive investors.
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Aaron: It's a really a nice expansion here where we started about two years ago with our own investments, kind of took the plunge ourselves with our own cash. Now we're opening it up to our passive investors and boy, do they love it because when I sent out an email about a month ago for our first short term investment opportunity to our passive investors in 72 hours, the thing was fully funded.
All right, ladies and gentlemen, welcome to the Passive Cashflow Podcast. I'm your host, Aaron Fragnito. Thank you for joining us once again for another podcast about an in-depth real estate analysis. Today, we have no guests. In fact, I'm going to talk about PCG short-term rentals. What's going on with our rentals right now, our short-term rentals, this new branch that we're developing here at People's Capital Group, and how we're expanding into new markets with new opportunities here that we've proven over the last couple of years. Now we're inviting passive investors to come on in and start investing passively and experiencing the benefits of owning a high cashflow properties in high demand markets without of course doing all the work.
If you want to learn more about that, you can go to People'sCapitalGroup.com, where you can learn the process to qualify for one of these passive investments, whether it's in a short term rental, or even in one of our apartment buildings in New Jersey. Let's talk about how it works, why we're investing in these markets and through this process with this type of real estate, the long term strategy overall with short term rentals in rural New England and the hospitality strategy there, and also the investor benefits, how our passive investors are structured with these deals and the types of returns and the types of benefits they gain from investing in these properties from cashflow to free vacation nights as well.
Seth Martinez my business partner, and I, we focus on primarily buying apartment buildings and fix and flips and multi-families in New Jersey. We've been doing that for about 10 years, but the issue with a lot of those properties is that they make great equity gains over time and get good tax benefits but, New Jersey income properties can be lower on cashflow. They don't produce a ton of cashflow and we want to compliment that lack of cashflow with a cashflow heavy investment for our investors, and that is short-term rentals. We find that a good place to do that is rural New England. Not going to give away exactly where we invest, because we don't want to invite a ton of competition but if you are a qualified investor, then you'll see those types of opportunities we're starting to put out to our network.
These opportunities include short term rentals on lots of land within usually about 15 minutes of a major ski resort in rural New England. We do find that people love getting out of the woods right now, especially with COVID going on and getting out and getting some fresh air. It is crazy the amount of demand we have. Now, our short-term rentals did good in 2018 and 2019, but now they're doing great. It's just crazy with, since the pandemic, this is a COVID friendly investment. It's actually an investment that makes more because of the Corona, not less. That's one of the reasons we're doing it. Also, it's cashflow heavy. It's not really an equity play where in New Jersey, when we buy apartment buildings, we buy them for a discounted price. We tried to do the same thing here in Vermont, but it's more of a cashflow focused investment in Vermont and where in New Jersey, we have an equity strategy where we'll buy a mismanaged department building, improve the value of it, improve the cashflow and refinance and harvest that equity over time.
Now with the short-term rentals are qualified, investors do have a three-year exit options, so they can exit every three years similar to our apartment buildings, which tend to be about three to five-year minimum investments. The investment amounts are similar around 30 to $50,000 to get started. The investments are similar in that sense and the benefits in addition to double-digit cashflow it's very fun. We actually give a free up to a week, depending on how much you're investing in the property, but up to a week, stay at the property. It's just a fun little bonus that we give to our investors, and it's something that buying apartment buildings and Newark and Patterson for years, we don't offer free stays at those properties, but we do offer free stays that the short term vacation properties here in Southern in rural New England.
Really a fun investment for our investors who not only are they making phenomenal cashflow on the property, they do experience some equity growth over time. They do also get to enjoy the tax benefits of real estate, tax depreciation, being an owner of the building of the property here for short term rentals. They also get to enjoy a free week there. Just a really fun investment for our investors. Fun for me. I actually enjoy discussing it with investors. Yes, I've been doing apartment buildings for years, so it's kind of fun doing a little change, and boy, are these just beautiful pieces of real estate. We're buying a two bed, two bath right now on 11 acres and we're adding a bedroom and a bathroom and improving the value and refinancing out one of our private investors.
We have two other private investors who hold long-term equity positions in it, and those equity investors will enjoy cashflow every quarter. They'll enjoy tax benefits, they'll enjoy equity growth. Those passive investors are also the ones that get the free stay, but it's just a beautiful piece of real estate with a stream running through it, really fun property with hiking trails and we own another property that is similar to that. We're also buying now a two-family and a nice, cute little town gear, and we're also right near some bars and restaurants you could walk over to and it's great during ski season as well, but even summer and fall and spring. We really love investing in these rural areas and it's just a beautiful to work. I enjoy coming up here and building this part of the business.
Seth Martinez is handling an operations primarily in New Jersey. I'm handling the operations primarily in Vermont right now. It's a fun expansion of our company here into rural New England. We've been here for about two years and now we're building out our portfolio. We have our resources in place. We have our infrastructure in place. My wife has a short-term management and hospitality business that offers incredible benefits like if you stay in one of our Airbnbs, you can buy a champagne service. You have cold champagne on ice with orange juice or pineapple juice or whatever mixture you want waiting at the property. There's also other benefits. Other things we can offer that well Dagny International Offers' my wife's company, not our company, different company entirely. They do all of our management hospitality servicing for our short-term rentals and they're incredible at it.
The cleaning system we have, the people we work with, the contractors there, and the independent contractors in rural England are great for us and we've developed a nice system and a good infrastructure, just like we have in New Jersey, but now out here in rural England. Really a nice expansion here where we started about two years ago with our own investments, kind of took the plunge ourselves with our own cash. Now we're opening it up to our passive investors and boy, do they love it, because when I sent out an email about a month ago for our first short term investment opportunity to our passive investors in 72 hours, the thing was fully funded. If you want to learn more about that and get qualified for our next opportunity, you can jump in there and get access to these private offering memorandums for either apartment buildings in New Jersey or our short-term rentals, which I'm talking about during this podcast here. The place to go is people'scapitalgroup.com and you can fill out an application right on our website, and that will allow you to hopefully qualify to invest.
We'll review the application. If you do qualify as sophisticated or accredited investor, then you can set up a call with me, Aaron Fragnito to learn more about the qualification process. Once we have that call, I will underwrite you and qualify you, answer your questions. Then if you're qualified, our staff will send you the offering memorandums. You can take a look at the next property we're buying with investors and take a look at all the details and understand it and then we'll have another meeting, a one-on-one. We can go through that offering maybe through a zoom meeting, which we're doing a lot of these days.
My name is Aaron Fragnito. Thank you for listening here. We talked about short-term rentals and how PCG, People's Capital Group, our company here is expanding into this new marketplace, using our infrastructure, bringing in our passive investors. We've already established a good infrastructure here and now we're opening it up to our network. Hope you learn a little bit about what we do and how we're doing it. If you want to learn some more, go to people'scapitalgroup.com. Fill out that qualification form. I'm Aaron Fragnito Thank you so much for listening today. Enjoy your afternoon. Enjoy your evening and enjoy your real estate investment experience.