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How to Become a Real Estate Mogul With a Single Stock

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Real estate can be an incredible investment. Over time, property has demonstrated lower levels of volatility when compared to stocks and bonds. And because real estate often has rent-paying tenants, these assets produce regular cash flows for owners. Plus, as the saying goes, property is the only thing they’re not making more of.

Canada’s real estate market has been especially lucrative. Since the 1950s, prices have more than quadrupled. Across individual cities, however, the gains have been even more spectacular. In 2000, the average price of a Vancouver home was roughly $400,000. Today, it’s nearly $1.7 million!

If you aspire to be a real estate mogul but don’t necessarily have the time or expertise, fear not. All you need is a single stock: Brookfield Property Partners (TSX:BPY.UN)(NASDAQ:BPY).

Top-tier management

When investing in property, management is key. After all, investing in real estate follows the same rules as any other asset class: your return will ultimately be a function of what you pay. Management has to not only grow the property portfolio but do so at attractive prices for shareholders. Additionally, they have to have the connections, reputation, and foresight necessary to fill occupancy with top-tier tenants willing to pay market rates or higher.

When it comes to savvy management teams, it doesn’t get much better than Brookfield Property Partners. The company is managed and co-owned by Brookfield Asset Management, one of the most successful alternative asset managers of the last 20 years. Nearly all of its endeavours are successful, outpacing their respective benchmarks.

Under Brookfield Asset Management’s guidance, Brookfield Property Partners has amassed one of the world’s largest and highest-quality portfolios of real estate. The company invests in all strategies and classes, meaning it can capitalize on value anywhere it’s available. You need a top-tier management team to pull off this “go anywhere” approach, but Brookfield Property Partners meets the necessary qualifications.

All in one

This stock really is a one-stop shop for real estate investing. Roughly 40% of the portfolio is comprised of office properties, with another 40% being retail locations. The remaining 20% is a diverse mix of real estate, ranging from self-storage to student housing.

The company doesn’t just invest in Canada either. It has $9 billion invested domestically, $137 billion in the U.S., $3 billion in Brazil, $31 billion in Europe and the Middle East, and $14 billion in the Asia-Pacific region.

All of these properties create enough cash flow to support a 5% dividend, one of the most reliable payouts in the industry. There are always more niche ways you can bet on the real estate market, including buying properties for yourself, but if you want to get global coverage on one of the oldest asset classes in history, Brookfield Property Partners has you covered.

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This article represents the opinion of the writer, who may disagree with the “official” recommendation position of a Motley Fool premium service or advisor. We’re Motley! Questioning an investing thesis — even one of our own — helps us all think critically about investing and make decisions that help us become smarter, happier, and richer, so we sometimes publish articles that may not be in line with recommendations, rankings or other content.

The Motley Fool recommends Brookfield Property Partners LP. Fool contributor Ryan Vanzo has no position in any stocks mentioned. 

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