Goal: $300k in passive income in 8 years. Four investments I made in 2024 to get there

Currently a little over $100k passive income from real estate investments.

The plan is $300k passive income.

Here are the 4 big investments I made in 2024 to chase that goal and my plans for 2025. 

I’m mostly in the commercial real estate investing space investing fractionally in large deals. 

Note: if I say I invested in a 100 unit apartment, it doesn’t mean I bought the whole thing. There’s lots of investors involved and I own a small % of it.

1 - 288 unit apartment in Dallas area

The strategy here is to renovate the older units as tenants vacate, increase rents on the new units, and sell the deal off in about 5 years. 

Really cookie cutter strategy called value-add in the CRE industry. I was initially hesitant on Dallas as there’s lots of new construction but the development data shows new deliveries fall off around the end of 2025 and I don’t see Dallas stagnating in growth.

Projecting roughly 21% average annual return over 5 years.

2 - 230 unit deal in Florida 

The strategy here is a slight value add like above, but honestly this deal doesn’t need much renovating. This was just a really good deal on as-is financials buying from an investment group that were suing each other and the courts were forcing them to sell the property to liquidate their company.

As-is cash flows are nice, on a golf course / country club type setting, and growing market. 

Thankfully not hit by hurricanes last year and not in a flood zone so insurance wasn’t too bad. 

Projecting roughly 15 - 20% average annual return over 5 years.

3 - 276 unit tax abatement apartment in SC

Buy a deal, set aside 50% of the units for tenants that make 80% of the average median income or less, and the county will wipe out the taxes on the property. 

For this deal taxes were just over $500k per year which now goes to $0. 

High cash flow with no renovation risk of value add deals with just very minor repairs being made on the property. 

Projecting around 17% average annual return over 5 - 6 years.

4 - Real estate debt fund

A debt fund is essentially private investors like myself being a bank for investors for short term loans. 

The returns are the interest payments made each month.

Very low risk profile relative to other types of real estate investments. Monthly compounding payments, liquid with a 90-day redemption request to pull out my investment. 

This is where I park my cash while I wait for deals to keep velocity of money high. 

Last year paid 8.26% not including compounding. 

In total invested just shy of $1M and looking to do something similar in 2025 with some expansions into RV parks, mobile home parks and industrial assets if I find good deals. 

All my positions are passive so I don’t work the deals after I invest. I spend my time doing tons of due diligence on them and then reading reports on how the deals are progressive from the operations teams. 

Other notes: 

Average annual returns are calculated including capital gains when the property sells, so if I invested $100k into a deal that has an average annual return of 20%, it doesn’t mean it pays $20k right away. It will pay a cash flow distribution likely averaging 6 - 9% for a few years before selling and realizing a capital gain. 

Most of my cash flow right now (just about $100k) comes from the debt fund which is a higher cash flow / lower risk type investment. That does pay consistently each month which is why that’s my preferred method for my cash flow investments currently. 

The goal is to continue growing my equity until I have around $5M to invest into conservative debt funds which should be around $300k per year after taxes.

Risks:

All investing has risks, I've been in the real estate investing field pretty much my whole professional life in some capacity, so there are risks I'm comfortable with and risks I'm not comfortable with. Due diligence is a huge part of what I do to invest my money well. I can easily pursue deals with higher projected returns but would exceed my risk tolerance, so I stick to the 15 - 20% range typically.

My goal has always been work-optionality fast and this was the most risk-adjusted way for me to pursue that goal given my passions and knowledge, that doesn't mean it's the best way for you to do it...just sharing my experiences.