Why Alternative Assets May Deserve a Wider Slice of Your Retirement Portfolio | Ep. 43

Episode Summary

For investors who have already built meaningful wealth, the investing challenge often shifts from maximizing upside to protecting capital, generating income, and deciding which risks are still worth taking. Entrepreneur and longtime investor Ron Assise joins Brian Spear to explain how his approach evolved from traditional stocks and bonds to direct real estate and a diversified mix of private alternative investments.

Ron traces much of his wealth creation to building and selling his insurance business, including his decision to retain equity and remain involved after the sale rather than simply accepting the highest immediate payout. He also explains why he began pursuing passive income through single-family rentals before moving into multifamily syndications, manufactured housing, self-storage, and debt funds.

The conversation explores Ron’s roughly 50/50 allocation between a traditional portfolio and alternative investments, along with the judgment required when evaluating private deals. His experience includes both a successful early multifamily investment and later deals that struggled despite credible operators, reinforcing the importance of diversification, realistic underwriting, and understanding external risks.

For high-net-worth investors and business owners managing wealth after a liquidity event, Ron’s experience offers a practical framework: know what you own, understand who is managing your capital, examine what happens when assumptions fail, diversify across investments and operators, and avoid taking risks you no longer need.

Key Takeaways

– Start investing early and consistently rather than trying to perfectly time markets. Ron credits time, compounding, discipline, and dollar-cost averaging as foundational principles that shaped his approach to building wealth.

– A business exit does not have to mean exchanging all future upside for the largest immediate check. Ron chose a buyer that allowed him to remain a contributor and retain equity, which ultimately created another significant wealth event.

– Diversification can extend beyond stocks, bonds, and cash. Ron currently describes an approximately 50/50 split between a conservative traditional portfolio and alternatives spanning manufactured housing, self-storage, multifamily, and debt funds.

– Private investment due diligence should include the people behind the projections. Ron considers speaking directly with the principal nearly non-negotiable and looks at character, discipline, track record, assumptions, and how the investment could perform when conditions do not go as planned.

– A successful investment can create dangerous confidence in the next one. Ron’s experience with a struggling multifamily deal reinforced the need to diversify across markets, sectors, operators, and strategies rather than allowing trust or previous success to replace due diligence.

Key Topics Covered

– Alternative investments for high-net-worth investors

– Traditional and alternative portfolio allocation

– Business exits and retained equity

– Wealth creation vs. wealth preservation

– Compounding and dollar-cost averaging

– Passive income through real estate

– Multifamily syndications

– Manufactured housing and affordable housing

– Self-storage investments

– Debt funds

– Operator and sponsor due diligence

– Pro forma assumptions and underwriting risk

– Diversification across markets, sectors, and operators

– Investment risk after a liquidity event

– Retirement, legacy wealth, and philanthropy

– Investing within your circle of competence

Episode Chapters

00:00 Intro

Brian introduces Ron Assise and frames the episode around investment judgment: who gets your capital, who you trust when plans change, and how confidence in your own decisions can become a blind spot.

03:18 Invest as Early as Possible

Ron shares an early lesson about the power of compounding and explains why time in the market, disciplined investing, and dollar-cost averaging matter more than trying to predict every market move.

05:26 Selling the Business (But Keeping Equity)

Ron explains how building and selling his insurance business created much of his wealth. Rather than choosing a buyer solely on price, he prioritized remaining a contributor and retaining equity in the larger company.

09:55 Building vs. Managing Wealth

The conversation shifts from creating wealth to preserving and managing it. Ron discusses how greater access to private alternatives has expanded the diversification options available beyond traditional stocks, bonds, and cash.

13:13 Funding Alternative Investments

Ron describes pursuing passive income through single-family rentals before transitioning away from active property ownership. A successful multifamily syndication became his first major step into private alternative investments.

15:57 Ron’s Portfolio Allocation

Ron breaks down his roughly 50/50 allocation between a traditional portfolio and alternatives. His alternative investments include manufactured housing, self-storage, multifamily, and debt funds, while his traditional side is comparatively conservative.

20:05 Vetting Your Investment (and Operator)

Ron explains why speaking directly with the principal is an important part of his due diligence. Brian and Ron discuss evaluating character, experience, realistic assumptions, and the operator’s ability to respond when a pro forma does not unfold as planned.

28:38 When Passive Deals Go Sideways

Ron examines a multifamily investment that struggled after an earlier deal had produced an exceptional result. The experience highlights timing risk, optimistic assumptions, diversification, and the danger of allowing a previous win or trusted relationship to weaken due diligence.

39:40 Working in Retirement

Although Ron reached a point where he could financially stop working, he explains why he continues. His motivation has shifted toward sharing decades of experience, mentoring others, maintaining purpose, and giving back to an industry that served his family well.

43:16 What the Money Is REALLY For

Ron reflects on enjoying the wealth he has built without abandoning the habits that helped create it. He discusses family, legacy, philanthropy, avoiding becoming a financial burden, and using money to create meaningful experiences with the people who matter.

47:10 Ron’s Sage Principle

Ron closes with several principles that guide his investing: trust your gut, pay attention to details, understand both the best- and worst-case scenarios, diversify, and invest within your circle of competence. If an opportunity sounds too good to be true, he says, it most likely is.

Full Transcript

[Transcript begins]

Montage: If it sounds too good to be true, it most likely is. It’s easy for an operator to backfill a pro forma. Nothing ever goes perfectly right. Quick exit and it was a 2x exit. Certainly whet my appetite towards alternatives, and that was where kind of we started the journey of getting out of tenants and toilets and into diversification and alternatives. Successful people are those that do the things that unsuccessful people are unwilling to do. Don’t outlive your money. Don’t ever become a burden on anyone. Fly first class because your kids will. One of the hardest parts of investing is that the spreadsheet, it only gets you so far. At some point, you’re making a judgment about people and the realities that are outside of the pro forma. Who gets your capital? Who do you trust to make decisions when things don’t go according to plan? And maybe more importantly, how do you know when confidence in your own judgment has started to become a little bit of a blind spot?

Brian Spear: Welcome to the Sage Investor. I’m Brian Spear, and my mission is to help you generate cash flow and build legacy wealth in a tax-efficient manner, because that’s what I’m trying to do for my family, and I’m sharing all the secrets that I learn along the way. Today, I am joined by Ron Assise. He is an entrepreneur and a longtime investor who has experienced both sides of that judgment equation. Today, we’re going to talk about how a simple piece of advice early in Ron’s career shaped the way that he built wealth. We’ll talk about why one of his best investment experiences may have made the next decision harder. And we’ll also chat about getting comfortable with passing off control and how he thinks about this in both business and investing. Ron, welcome to the Sage Investor.

Ron Assise: Thank you, Brian. Great to be here.

Brian Spear: Yeah, absolute pleasure to have you. I appreciate you carving out some time. I guarantee that the listener is going to get a ton of knowledge and experience, you know, from your experience and years of wisdom in the game. Just to add a little bit of context for the listener, you know, you’ve spent nearly four decades now in insurance and in personal risk management in that world. You’ve built your own agency, ultimately ended up selling the business. And over the years, you’ve also built a pretty diverse investment life from owning individual stocks and then just traditional stocks and bonds along the way. Ultimately, then you got involved in real estate, some active stuff kind of in my backyard up in the Chicagoland area where I grew up. And then eventually diversified into a wide range of private alternative investments. But for the listener here to better understand kind of where you’re at right now, what type of investor do you consider yourself today?

Ron Assise: You know, I would say just based on, you know, what inning I’m in in the baseball game of life, you know, I’m probably in the bottom of the seventh, maybe even top of the eighth, somewhere in there. So I would say pretty conservative, relatively speaking. When you think in terms of, say, somebody doing a Monte Carlo, for instance, I don’t need and I didn’t need to do much in terms of taking a lot of risk. So I would say reasonably conservative, although very diversified.

Brian Spear: Beautiful. Now, beautiful and kudos and congratulations for getting to that threshold, right? So it’s a beautiful thing. So let’s run it back here a little bit. Let’s run it back to kind of how you got started, maybe even started investing, right? Earlier on in your career, when you first started allocating capital, I remember you mentioned ultimately, you know, investing pretty simply early on, including buying some small amounts of stock in McDonald’s, you know, while you were literally working there. So, you know, what, in that early aspect of life, what do you understand about money today or ownership? You know, what are some of the lessons that you learned early on in your journey that kind of have stayed with you?

Ron Assise: I remember really early on, and I remember it being presented as the tale of two brothers. And it was, you know, one brother—they both invest, you know, X amount of money. One starts now and stops in 10 years. The other one starts in 10 years and goes all the way till 65. And brother one has more money. And that teaches you it’s not about timing. It’s about time and the magic of compounding interest. So some of those early life lessons in terms of you’re never going to be smarter than the market. You know, you might get lucky a few times, but at the end of the day, you’re rarely going to be smarter than the market and be able to really figure out what’s going to happen next, you know, too much in advance of today. Right. So time and starting early and being disciplined and letting the process work for you. And just, again, dollar-cost averaging is another great example of just be disciplined, be consistent. You know, the dips work in your favor, and watch the money grow based on the magic of compounding interest.

Brian Spear: Yeah, I couldn’t agree more, right? You know, leveraging time as a tailwind is a beautiful thing. I share the sentiments. Kind of, you know, it’s so fundamental, it’s so basic, it’s so core. But of course, it’s key to success along the way, undoubtedly, man, of just getting started as early and often as possible. You know, the old adage, right? The best time to begin was 10 years ago or 20 years ago or 30 years ago. But for those that haven’t done it, the next best time is literally right now. Just get rolling and keep it ripping, man. So it’s a beautiful thing.

Well, let’s talk about kind of, obviously, you were starting small, but over time, you’ve been able to build some wonderful things. But when you look back, where was most of the wealth actually created along the way? And maybe—go ahead, go ahead.

Ron Assise: You know, ultimately, the biggest part of the wealth was created by starting a business, building a business, and then ultimately selling the business. And during the time of owning the business, building a pretty successful business with a really strong EBITDA and a large margin, based on a lot of it, based on my unwillingness to fail.

You know, again, one of the early things I will never forget: first day at Prudential when I started in the life insurance business. And it was a really simple adage: successful people are those that do the things that unsuccessful people are unwilling to do. And I mean, it’s so basic, but it couldn’t be more true. And that works for work, that works for business, that works for life, that works for investing. It works for, you know, child rearing, you name it. It’s a pretty universal adage.

Brian Spear: I love it. I literally just had this conversation with another entrepreneur, having the same exact dialogue. It was absolutely wonderful. It’s not that there is not failure. Failure is an inevitability, but the difference is you just don’t quit. You keep pushing forward. You have persistence and you keep on moving. What I would say is find me a successful person who has never failed. You can’t. They don’t exist. They fail over and over and over again, but they just keep on plowing it forward, keep on moving forward right through all the adversity and eventually ultimately knock down all the pins and become successful. It’s wonderful. Wonderful. It’s absolutely wonderful.

So, Ron, I got to ask you, when you were looking at selling the business, was it purely about getting the best price possible or were you thinking about who you were actually partnering with and what your role could potentially be after the deal closed?

Ron Assise: When I was selling my own business—and not the exit of our company a few years ago, which I didn’t have a lot of control over where we went—but when I sold my business to Horton some 21 years ago, it was very important to me. There were a lot of options, probably some that would have paid me more, but none that would have allowed me to be a key contributor going forward to the value of that new company.

And that actually couldn’t have served me more well because the value of that company ultimately exploded in the eventual sale of Horton, which I couldn’t have seen coming necessarily. But the ability to be a significant contributor, you know, on the exec team at Horton was a key component rather than, we’ll give you this multiple or that multiple, and we don’t care what you do going forward. We don’t want you, whatever. So that was a big deal.

Brian Spear: Yeah, and I think that it really helps for life as well. I’ve heard a lot of different entrepreneurs, I’ll use the term, take multiple bites of the apple. You build a wonderful business, and then you find a way to ultimately take some chips off the table, which is kind of what’s occurring there.

When you take some chips off the table, you sell the business, but now you’ve got an equity stake in the new company. You’re still kind of rolling forward, got equity stake, and you had a second bite at the apple, second windfall. Beautiful.

But maybe one of the most fundamental, life-changing experiences for an entrepreneur who has concentrated risk and has worked his fingers to the bone for multiple consecutive years, where you finally get the opportunity to have that first large liquidity event where you could take some chips off the table, which provides you and your family with the comfort where it’s significantly less risky, right? You got multiple years of lifestyle expenses now in a liquid format, which materially changes your perspective and the comfort level that you have. So, I mean, again, multiple benefits associated with, along the way, taking some chips off the table for the betterment of lifestyle and, I’ll use the term, work-life balance, if as it were, you know?

Ron Assise: Right. And, you know, moreover, one of the principals and founders of Horton at the time said, what’s going to have more upside? You staying in your place and building that some more—and not to take away anything from you—or taking equity in Horton and the growth of Horton? And ultimately, that couldn’t have been more true or perfectly, you know, just completely came to 100 percent fruition and then some.

Brian Spear: Let’s talk about kind of, you know, what’s changed over time after having that wonderful experience of building the business, going full circle, clearly full cycle. You have a little bit of a windfall when ultimately exiting the business. That’s wonderful. You know, how did your life change? What was different between building the wealth and then ultimately managing it afterwards?

Ron Assise: You know, I think in some regards, a lot has changed because the advent of alternatives and the availability and accessibility of alternatives, which, you know, really wasn’t super prevalent to the individual investor, you know, just a small handful of years ago. And now it’s everywhere. I mean, almost overkill in some ways. But at the end of the day, it’s a great thing because it allows investors.

Back in the day, diversification was stocks, bonds, cash, and maybe it further diversified between domestic and international or by sector. Great. But it was still equities, fixed instruments, and cash. So now you get into something like, you know, Sunrise or debt funds or things like that, or, you know, multifamily syndications, you name it. It’s just another layer of diversification and the ability to be conservative and yet not, you know, watch your money rot in a 3% money market.

So, you know, it’s been very fortunate in that. I think a lot of the success in business was predicated on taking what I would now call educated risks. You know, but again, betting on a lot of it was betting on myself and ultimately my team. But it was still some risks.

You know, I’ve been fortunate. I’ve been fortunate that I’ve never had to take on a lot of leverage just because I don’t know that I have a master blueprint for that. I worked hard early, built some money, and utilized that to go to the next step without having to take a lot of leverage. So I’ve never known an experience where I had to be heavily in debt. I don’t think I would like that situation. So that’s been fortunate. But I think just the availability of being able to have a lot of options now is a really great thing.

Brian Spear: Yeah, it’s nice. It’s just nice to have the plethora and the buffet in front of you. Sometimes it can be, like you mentioned, information overwhelm, given the advent of the Internet and AI. And now so much—I mean, even sometimes even too much to choose from. It gets difficult.

It’s kind of like all the content that gets put out there, all the TV shows, all the movies. It’s like you only have so much time. It would be impossible to absorb everything. One of my buddies is an entrepreneur in tech. And as AI has been going so crazy, he’s trying to stay out in front of the tech world. He wants to be on the bleeding edge. Well, it’s moving so quickly, by the time that he reads the next paper that’s like a really deep, deep paper associated with the next model, the next iteration has come out, right? By the time that he absorbs it and changes all the software that he’s operating with it, it’s very, very difficult. It’s just information overwhelm. So it’s kind of tough out there in the marketplace.

But yeah, let’s maybe help me understand kind of how you began to get involved in the alternatives. Clearly, it’s been a journey from traditional stocks and bonds along the way. Like, what was your initial entry? How did you get involved in this crazy universe of alternative investments? What got you to take the leap? And how did that evolve over time?

Ron Assise: Well, it really started by my desire to start to build some passive income as I started getting, you know, in my early 50s. And I thought about, you know, where am I going to go for passive income? So, yeah, looked to real estate, but much more traditional real estate—in this case, single-family rentals, many of which were in your hometown. And we talked about that the first time that we talked.

In fact, most of which were in that town and the surrounding towns in suburban Chicagoland. Again, that was very opportunistic. I was a cash buyer. I was able to make decisions very quickly. I aligned myself with someone on the real estate side, on the broker side, that I trusted and was fortunate.

At one point, got to nine single-family rentals, primarily all just market rentals. And it was—I bought them right. I was fortunate to have some strong tenants. I was probably a little below market in rent, but in exchange for that, I had good tenants who paid and took care of the properties, et cetera.

And at some point just realized that we were spending more time in Florida, away from Southwest Chicago, that it was probably time to modify that strategy a little bit and get out of being, you know, tenants and toilets and all of that.

Brian Spear: Yeah.

Ron Assise: So as I started to exit some of those, a friend of mine who was also an individual real estate investor, but on a bigger scale than I, brought me to a multifamily syndication that he was entering. And the timing could not have been better. And it was a quick exit. And it was a 2x exit. And it certainly whet my appetite towards alternatives. And that was where kind of we started the journey of getting out of tenants and toilets and into diversification and alternatives.

Brian Spear: Yeah. Beautiful. Love every bit of it. I’m happy to hear that you had a good first experience. It’s beautiful. The difficulty is if it’s in one of those crazy market cycles where it’s an upswing and the cap rates are compressed, it’s very difficult to know if you’re investing with a skilled investor or a lucky idiot during that period of time. You really don’t know. It’s tough, but glad that you had a good first experience, and then more education comes, more experience comes over time. It’s all wonderful.

We’ll talk about kind of your portfolio now, right? In terms of like where you’re at, do you have a specific allocation you’re looking for in terms of like, you know, 50% traditional equities, you know, 30% alts? Or, you know, is there something specific that you’re kind of leaning in and what you’re seeking to achieve, and do you reallocate it on an annual basis, or what’s the philosophy there? Any thoughts?

Ron Assise: Sure. Sure. So I would tell you my UBS consultant would say I’m probably a little more concentrated in alternatives than he would recommend, and he may or may not be right.

I certainly—there’s a great place for traditional equities, and in this case, in my traditional portfolio, if you will, much more conservative than mostly equities. It’s a lot of munis. And I’m fortunate to be a Florida resident. So the munis are federal and state tax-free, so it works. But that’s obviously a very conservative play relative to the return, but a really, really good and solid base.

You know, the other probably—and it is close to probably for us about 50/50. Fifty percent of our net worth in a traditional UBS-type portfolio, which, again, in this case is a lot of fixed munis and then maybe 25% equities, and then the other 50% spread among several different sectors and alternatives from yourselves.

We have a sizable stake in Sunrise and are very happy to have done that and feel very great about that. So obviously the mobile home sector, to some self-storage, to some traditional multifamily, and then a couple of different debt funds. And I’m probably forgetting something along the way, but those sectors within alternatives.

Brian Spear: Yeah, beautiful. Thanks for giving us a little color there, bud. Let me ask about just the traditional financial advisor. You’ve been working with a wealth planner for a period of time. Have you changed that over time? Have you swapped financial advisors? How long have you worked with that individual advisor? What has your experience been with that one individual and just the entire kind of wealth management business over time? Have you evolved over multiple different folks? Just give a little color on that journey.

Ron Assise: Sure, sure. And actually, I have had a small handful of folks. Started with, of all things, Fisher Investments, which came from an ad I saw somewhere when we were first acquiring enough money—wealth, if you will. I don’t necessarily think of it in that term back then, but when we acquired enough assets to have a, you know, a traditional advisor. And that worked well.

They had a pretty focused strategy of equities, equities, and equities. And we think you should pretty much. And, you know what? It certainly has proven out over the last couple of decades. You can’t argue with it.

But once I kind of outlived that, I went to a seminar where there was a little more of a holistic operation, which had tax planning in it, a CPA on staff, along with the wealth manager and a much larger firm. And that served me well for a while.

I met actually the UBS people when I was looking into Florida residency back in the late, like 2019, 2020. Went to a seminar they held about Florida residency, which was phenomenal. Took us about three or four years to eventually start doing business with them. But again, they kind of brought it up to a little bigger level and probably were more apt as my asset base grew. And that served us very, very well. And they’ve been able to structure some projects, some muni ladders, et cetera, that have worked out really well.

Brian Spear: Yeah. Wonderful. Right. And I’m sure that there’s layering in estate planning and a million other things as well as you think about the kids and so much. Beautiful, beautiful stuff.

Well, you know, let’s dig into specifically the alt side of the business, because that’s where our universe is. You know, when you’re trying to find those respective investments and you’re out there in the market trying to nowadays absorb all the litany of stuff that’s available to you, right? When you’re evaluating an investment, what are you really trying to learn about the team or the person that you’re trusting with your capital?

Ron Assise: I’ll twist the question into how we first met because, I don’t know, I have a memory for a lot of useless information sometimes, but it’ll serve us well here. I remember—the short answer is when I vet a potential investment, I find it extremely helpful and almost non-negotiable to talk to the principal.

You know, I normally don’t go in with the minimum. So I think hopefully I’m worth talking to by the principal. It gives me a lot more perspective. Not to say there’s anything wrong with the investment development folks and so on, and they have a job to do and I’ll have a conversation with them. But before I ever pull the trigger, I like to try to talk to the principal.

I remember, you know, looking at, again, the ad that I saw for Sunrise and, like most people, probably assuming, you know, mobile homes, you know, what’s up with that? And really wasn’t a sector—I believed, like most people, I think, or many people assumed it was a very transient type operation. And you find out it’s exactly the opposite.

But when I reached out, I remember being at Bahama Breeze in Fort Myers, Florida, and seeing my phone ring from a phone number that started with 219, which was intriguing because 219 is Northwest Indiana and Chicagoland, basically.

You know, you returned the call and, you know, we had a fairly brief conversation. That was at dinner and it was a prelim kind of thing. But immediately there was obviously synergy based on where you grew up, et cetera. But you can learn so much in a 30-minute conversation with the principal about them as a person. And then following that up, if I can meet them in person, if I can find a way, it’s even better.

It also leads to a lot of mediocrity and even some things that are worse than that relative to, you know, just is it a real business? And do they have a real plan, et cetera?

Brian Spear: Yeah, no, it’s an interesting one, right? It’s an interesting dynamic. You know, guys that have really kind of become experienced over time, that have done a lot of these types of deals, right? Ten-plus type of transactions.

In virtually every scenario, that more experienced LP that’s diversified across alts typically will convey that the human being that is ultimately managing the capital, right—the jockey, as it were, betting on the jockey—is far more important than betting on the horse or the deal in and of itself.

Any given individual deal, any given individual fund, at the end of the day, you’re really betting on the human being, the person that’s actually managing it. In the vast majority of scenarios, that’s typically where all results lead. So I share the sentiment.

Spending time together is a huge, huge benefit, if at all possible, right? And so anyway, I thoroughly enjoyed our time together and have subsequently enjoyed many of the additional conversations we’ve had over time as well, man. Truly, it’s been wonderful to get to know you more over time as well and the unbelievable business that you’ve built, the family that you’ve built, and so much more.

Again, we were talking prior to actually pushing the record button about where you’re at in your journey now with, you know, now just becoming a grandpa over time. Got a new one. You’re actually out in Oregon right now trying to experience that, you know, a couple months old. It’s beautiful. Kind of the next chapter of life. It’s absolutely wonderful.

But I think that, to your point, when you get to spend more time in person with folks, get to know who they are, what they’re really all about, deep down in their bone marrow. To me, that is a far more important piece than whatever the XYZ deal is, you know, getting pushed, as it were, across the desk.

Ron Assise: You know what, Brian? I think also it’s easy for an operator to backfill a pro forma. I mean, and I don’t even mean nefariously. You know, the best intentions, but, you know, there’s pie-in-the-sky operators that can map out a pro forma that says if everything goes perfectly right, this is what’s going to happen. And that’s the way they raise capital, which is not—nothing ever goes perfectly right.

I mean, I’ll recall being with the Sunrise folks last year in person. And one of the things you spent over an hour on with current investors was talking about one of the things that went the most wrong for Sunrise that started out like, this is going to be a home run. And at the end of the day, a lot of things went wrong.

Yet you’re still hitting line-drive singles with it because you had the ability to pivot and figure out what needed to be done to stabilize it and move forward. So, you know, those are the things that—and again, it’s not to say you can tell all of that in an initial 30-minute conversation.

But I knew five minutes in when you talked about being an athlete. In my career in hiring, training, and developing salespeople, athletes are generally great salespeople because they have a competitive nature, et cetera.

But I also knew from talking about, you know, where you grew up and what you did that, you know, you were somebody that had integrity, or at least I felt that, and that has borne out. So that’s why being able to get to the principal and have a conversation is so important.

Brian Spear: Well, first of all, I appreciate the kind words, Ron. It’s very much appreciated, buddy. I’ll speak briefly on the athlete aspect because I agree. We’ve had a lot of success in that regard as well.

We actually call all of our, I’ll say, employees teammates. We don’t have employees here. We have teammates. We’ve tried to build our culture in such a way that we are all a team. We’re all rowing together. We have a ROSE execution strategy, literally the acronym R-O-W-S. We’re all rowing together in the same direction.

A lot of the things that I learned along my journey, these are life lessons that you learn on the field, whether it’s on the wrestling mat or on the diamond or wherever you’re going. Like, you’re learning the lessons about life.

I loved doing both individual sports and team sports. Like, when I was wrestling, you learn a lot about your backbone. People that get involved, like all the dads and moms that go to wrestling stuff when the kids are five, six, seven, eight, ten years old. When they’re going in, they’re signing the kid up, they don’t realize how many tears are in the gym during the little kids’ wrestling matches, because when you lose, right, it’s one thing when you lose in basketball or football or anything else. But when you lose a wrestling match, when it’s mano a mano, one on one, man, it is tough to take. A lot of tears in that sort of environment.

But, you know, it’s just about overcoming adversity. Like we talked about persistence, not quitting, continuing to fail forward. And we try to bring that into the business world as well.

In fact, I know a guy that runs a private equity shop. Exceedingly intelligent guy, actually at Harvard, super, super smart guy, and he’s rolling up multiple different platforms. And each individual platform that he brings on, he hires a new CEO for each platform, and that individual must have been basically a version of the all-American boy—an exceptional individual academically, but also exceedingly driven, captain of his team all the way through collegiate sports—because there’s just something associated with that type of personality trait that had, in his opinion, proven to be successful.

So for whatever it’s worth, whatever that means, I have no idea. You know, everybody’s got a deck of a hand of cards that they’re dealt over time. You just play the hand that you’re dealt.

You know, I just feel genuinely like I was blessed with a lot of gifts in life. You know, my mom, I always say like, Mom, you blessed me with a lot of gifts in life. A strong hairline wasn’t one of them, but, you know, I was pretty fortunate to be pretty athletic, pretty smart, all the nonsense, right? Just anyway, wonderful, wonderful feedback.

Ron Assise: That’s why you got Kevin.

Brian Spear: Oh, I agree. He can be the pretty boy, man. He can be the pretty boy. And that’s a beautiful thing, right? I mean, golly, it’s a beautiful thing.

Ron Assise: He’ll take credit for that.

Brian Spear: That’s fine. I just do the dirty work behind the scenes, man.

As far as—let’s pivot back to the investment world and your experience. So, you know, we’ve had some wins along the way. You talked about a wonderful initial experience in alternative investments, but it ain’t all sunshine and rainbows. You’ve had some downturns over time and maybe some pitfalls.

Maybe give us a story about a deal that, you know, didn’t work out exceptionally well. Maybe a painful story about one of the alt investments and kind of how that might have changed the way you invest.

Ron Assise: Yeah. So, you know, ironically, the—and again, I started with, you know, it was either a really great triple or it was either a home run or a grand slam. So in some regards, maybe not the best lesson, because it inherently and subconsciously, oh, we got to do more of this.

Brian Spear: Right.

Ron Assise: Right. It wasn’t the same operator, but it was the same person that brought me to that operator that had a subsequent opportunity. It wasn’t a 1031, but it was subsequent to the redemption of that first opportunity. And it was another multifamily.

The first one was college student housing in North Carolina at the peak of the real estate—I mean, it just couldn’t have been more, again, perfect timing, et cetera.

This one was Tucson, Arizona. Sounded great. Pro forma looked good. And Tucson is just—I mean, it couldn’t have been a worse time to go into that MSA. And, you know, the investment continues, but it’s not going to work out well. And I don’t know how not well it will work out or not work out, but they’ve had to completely change the platform from apartments to condos. And that strategy hasn’t served it well either. The debt service is catching up.

So it—but it wasn’t—I don’t think it was a poor operator. I’m confident of that because I trust the person that brought it to me, who was, you know, part of the equity raise team, if you will, and an investor in the same deal. He’s crying right alongside us.

But at the end of the day, it’s, you know, the best-laid plans. And it just turned out to be a horrible time to be in that market. And so, you know, another reason you diversify between MSAs, between sectors, between, you know, different platforms, et cetera, and different operators.

But more importantly, again, if you’re all multifamily, it’s probably not a great idea. All mobile home isn’t probably a great idea. You know, it’s the old story about diversification for sure.

Brian Spear: Yeah, wonderful, wonderful. You know, what comes to mind for me when you talk about that is the timing aspect. It is one of these oddities that in investments, right, the old crystal ball—like my crystal ball is broken, your crystal ball is broken. The Fed doesn’t even know what the hell they’re doing.

And so it’s very difficult to perfectly time the market, maybe for brief respites, but over an extremely long period of time, an entire investment career, impossible to be perfectly timing the market in every way, shape, and form.

And so for my money, where I spend my time is trying to allocate capital to businesses, properties, ventures—businesses generally speaking—that have the ability to have persistent differentiated returns, more of like a moat that regardless of the economic environment, it’s going to do well.

Right. Maybe not grand slams, you know, the old venture capital Uber-style transactions that are going to throw out thousand-plus-percent returns, et cetera. But rather just it’s the singles and doubles over and over and over. You know, it’s going to perform well and do so in a tax-efficient structure. That’s how I think about it.

So regardless of what ultimately happens in the economy that you’re facing, you’re going to do reasonably well. That’s my personal contention, personal philosophy on how I allocate my family’s money.

I was going to ask you about the takeaway from that. Again, difficult timing in Tucson. Not every deal is going to be sunshine and rainbows. You talked a little bit about diversification. The biggest takeaways, you know, I would ask, what do you do differently now after kind of extracting those lessons along the way? Did that impact kind of your investment philosophy at all? What might you do differently given the lessons that you’ve learned along the way?

Ron Assise: Yeah. When I look at, you know, doing an M&M, so to speak, on that one particularly as an example, I don’t think there’s anything that jumps out at me that says—I mean, on some level, I probably didn’t do the amount of due diligence I would have done if it wasn’t a known commodity, the person that I did so well with in a prior deal that I know and trust and who’s a personal friend.

But, I mean, as I look at it going on the backside of it, it wasn’t—the plan was solid. It’s possible that the expectations were on the high side or the pro forma was kind of what I talked about a little bit ago. And that was that it was based on some assumptions that may have been a little more pie in the sky than they should have been.

But in general, it just really was timing. And so much of this is external things. Obviously, you talked about the Fed. Well, let’s face it. Interest rates affect cap rates, you know, profoundly.

And looking back a couple of years when Trump got back in office, I would have expected, you know, based on what he was talking about, I think a lot of us would have expected 150-point moderation in rates, and short- and longer-term rates. But hasn’t happened.

So, and I think, you know, another experience I had that hasn’t been great so far is a self-storage investment. And you and I and Kevin had talked about this. You know the operator. And it’s a solid operator with a great history, but because self-storage is predicated on real estate and real estate transactions and people moving, the interest rate environment has caused people to stay in their homes because they don’t want to give up their 3.5% mortgages for 6%, et cetera.

So there’s a good example of the domino effect and how that can affect something that, again, great operator. I think long term it’ll be fine, but it’ll be longer term than we expected and probably not the multiple we expect. But I still feel solid about the fact that it’s an operator with a lot of history that was reasonable in their expectations. Just some things that they didn’t see coming. And that happens.

Brian Spear: And a fair statement there, right? I mean, that is a playbook for folks who are willing to take a certain amount of risk. I mean, think about venture, what those guys are doing. They’re throwing out 100 different investments, smaller bets, but 100 different investments, knowing full well that 90 of them are probably going to zero, right? Maybe 95. But then they’re trying to hit the grand slam with Uber. There’s people that choose to go down that path.

Sam Zell had this quote, and I’ll just paraphrase. I’m going to butcher it. But basically, he conveyed at one point he’d had an investment that ultimately didn’t pan out, went to zero. One of the deals he was doing. Again, the guy’s got billions of dollars of experience across the litany of asset classes, founded multiple REITs, et cetera.

So, again, it ain’t all sunshine and rainbows. He had a deal that went to zero. And so afterwards, he was getting asked kind of the debrief after the fact, you know, what would you do differently, this, that, and the other? And he stated, I would do literally nothing differently.

And because his perspective was, I had run the analysis, I knew all of the risks, we had made some assumptions on what we believed was going to occur. But in terms of the risk-adjusted return nature of this respective investment, a possibility was assuredly this investment was going to go to zero.

And so it was well within reason, even given that information, I was totally comfortable making the investment, and it ultimately went to zero. And it’s not like he regretted it at all because it was a function of the investment philosophy and it was part of the portfolio allocation strategy that he had. And he was comfortable enough with taking that level of risk.

That is not a level of risk that I’m personally comfortable taking with my family’s money, knowing how difficult it is when you do have those losses. It’s obviously brutal. I don’t need to tell you the simple math, right? Guy’s got a million bucks. He loses 50%. He’s down to 500 grand. He’s got to double the investment to get back to where he was at. It’s brutal. The losses hurt so much more than the wins.

So, I mean, I try to avoid it personally like the plague for my family. But there’s something to be said about that. If you go into it with eyes completely wide open, taking that risk, there’s something to that. I just personally would prefer to be more conservative in the way that I personally allocate capital for my family.

Ron Assise: But, you know, another thing, Brian, that I think you asked about how kind of how the transition, or how we kind of transition as different segments happen, when you think about one of the sectors that’s predicated around what Sunrise participates in, and that’s affordable housing, right?

There’s no question, no matter what happens in the economy, talk to 20 pundits and 19 will say there’s a major affordable housing shortage. And whether it’s 6 million units or 5 million, whatever it is, the numbers are similar, right?

So there are definitely sectors, whether it be mobile homes or whether it be build-to-rent, et cetera, that are going to specialize in or are going to try to fill that void and build. Almost nothing that happens externally is going to shoot that in the foot if the operator knows what they’re doing and has a solid plan and is going to be realistic in their expectations.

So I think looking at external factors differently, that will help you versus external factors that will hurt you, can help mold what you think about going into in the future. And in our case, it’s everything from a debt fund that might kind of be on the outside of that but still involved in that, or whether it be direct, something like Sunrise, where you’re directly and specifically filling the affordable housing void.

Brian Spear: Yeah, no, I couldn’t agree more. Double-clicking into the point that you made, and it’s why you bet on the jockey, not the horse, right? Again, the investment thesis is associated with affordable housing. We’ve chosen to play within the realm of manufactured housing, a subset of affordable housing.

And it’s just unbelievably phenomenal, durable, long-term supply and demand economics. Like you said, wonderful stuff, great moat, all the myriad of things. But it doesn’t change the fact that there’s guys that are even in our industry that have bought wonderful assets that have still found a way to lose money because of the over-leverage and poor operations, a gajillion things, right?

So it is truly about the guy that’s, you know, got his hands on the wheel, that’s driving the ship. My personal contention, even in the most wonderful of asset classes with all signs pointing to this investment should be solid, you know, you still have to go in with a level-headed individual that’s ultimately managing the capital, right? That’s, again, all roads lead back to, you know, betting on the jockey.

Well, let’s maybe pivot a little bit to kind of where you’re at in your journey, bud. You’ve talked about, you know, having an itch. Like a lot of different people have that goal, if you will, of retiring at a certain age. Or, you know, 55 is kind of like the number that folks have often kind of tossed out there, retiring at 55.

You know, I don’t want to age you, but you’ve subsequently crossed that little chasm, that little threshold over there. But, you know, you still find yourself waking up in the morning, heading into work, doing the thing. You obviously are at the point in your life where you could choose to stop working, but you have continued to do so. You know, why do you go about that process? What makes you get up in the morning, go to the office, work every day? How do you feel about that?

Ron Assise: So it’s a very interesting, very, very pertinent question. So you’re right. And ironically, because we hadn’t talked about this before, I don’t believe, that was my initial goal, you know, back in the day: leave at 55 and, you know, et cetera.

And at 55, definitely financially could have done that. But didn’t even consider it because it’s like, you know, you can only golf so many times a week. You can only play tennis so many times a week, et cetera.

So in my journey, actually, at about 55, almost on the button, is when I decided I would not endure another Chicago winter. Changed my deal. This was the year before COVID. So remote wasn’t a thing yet. I mean, you could work remote, but nobody did it. Everybody’s still in the office every day, et cetera.

So I talked to, you know, my partner and our CEO at the time and said, that’s been another weekend, another winter here. Time to look for my successor. I’ll train them, et cetera.

And, yeah, long story short, it morphed into becoming a Florida resident, et cetera, the next year and changing particularly my compensation, et cetera, by my own device.

And, you know, today, what’s changed is not a lot in that I feel like if I—it’s not so much my worry about what will I do with myself, but what would I do with my knowledge and what I can give to everybody around me?

Hopefully it doesn’t sound pompous when I say that, in that I just feel like I have a lot to give and a lot to share. And I have a responsibility to do so, to help those that are 20 or 30 and, you know, just starting out.

It’s a different business, but it’s the same business. You know, we have AI and all kinds of stuff that make the process of how we do things maybe different. But at the end of the day, almost every business is still a relationship business. And that’s hard to teach. And it takes a little while.

So that’s what makes me get up every day. And because it’s certainly not the compensation, by my own device, that I changed. And that’s fine. At the end of the day, it’s really just about trying to give back. It sounds very cliché, but it is truly—I want to be able to.

It’s been a phenomenal business for my family, and we’ve been extremely blessed. And it’s my responsibility to try to help somebody get there as well.

Brian Spear: It’s wonderful. Love it. More purpose and impact than anything else. Love every bit of it, Ron. Wonderful stuff. Speaks a ton about your character as well. Love every bit of it.

Well, we’ve talked about how you built a platform, how you built the capital. We’ve talked about how you’ve protected it over time, diversified, allocated it. I want to finish with what might be the hardest question of all. Like, what is all that capital ultimately for along the way? What is all that capital ultimately for?

You spent much of your life trying to build enough wealth that you wouldn’t have to worry about money. And now you’re kind of largely in that position where you’ve accomplished that feat. Kudos. But what do you believe that money is actually for?

Ron Assise: So, you know, I had a conversation with a good friend who has a greater level of affluence than we do, but we’re very similar.

My wife said to me not long ago that somebody said to her, fly first class because your kids will. And I thought that was a really, really—she grabbed that from somebody else, obviously—but I thought that’s a very interesting thing.

And yes, it’s time to do some of those things. And I have no worry doing that. And I have no worry going out and buying a luxury car. Of course, as long as I get a good deal on it, et cetera.

But at the same time, while going out and buying a luxury car or treating ourselves well, I get very irritated if I forget the $5 CVS coupon that I didn’t use. Okay? And, you know, it just—and that’s a—

Again, I didn’t come from a lot. It was not unlike yourself. It was myself and my mom. My dad got sick with ALS at five and died when I was eight. And my siblings are older. I was the oops, the oops kid. So it was myself and my mom.

And we weren’t—you know, we didn’t worry about eating, but we didn’t have a heck of a lot. And she taught me to work hard and take pride in what you do, no matter what you’re doing, whether it’s cutting the grass or cleaning the counter or, you know, doing your job.

So, you know, at the end of the day, yes, it’s time to enjoy ourselves and reap what we’ve sowed. But, again, I think if you ask most people that are getting to retirement age or in retirement, the number one thing is don’t outlive your money. Don’t ever become a burden on anyone.

And obviously, if you can leave a legacy for your kids, your grandkids, and allow them to not have some of the—struggles may not be the right word—but maybe able to, you know, have it a little easier than you had it, you know, that’s great.

And I think that’s in addition to certainly some philanthropy for causes you believe in and so on.

But, you know, you mentioned I’m in Oregon, right? And Oregon’s a long way away from Chicago and a lot longer away from Florida, right? But I feel very blessed to have the means to be able to get on a plane continuously, because that’s going to be our life from now on for a while until hopefully they move east and north a little bit. Or at least east.

So, you know, we feel very blessed to be able to do that.

Brian Spear: It’s beautiful, man. Love every bit of it. Yeah. Just trying to find a way to enjoy life, whatever that means to you, given the crazy fact that it’s so short. You know, in the grand scheme of things, it’s a blink of an eye, man. A day goes by, a week goes by, a decade goes by, and it’s absolutely insane.

So enjoy it as long as you possibly can. Enjoy the ride. It’s a beautiful piece of what you’ve been able to accomplish and a core piece of what we’re trying to achieve here at Sunrise as well. Enjoying the ride along the way, man.

Well, let’s round it out here with one final question. This is how we always like to end every respective episode for the betterment of the listener here. But if somebody could only remember one lesson, one piece of Sage investment advice from your entire life experience, what should it be?

Ron Assise: You know, I would say trust your gut because your gut is usually right. And, you know, that can take a lot of different angles, if you will.

And that kind of goes back to one of the first things we talked about, and that is have a conversation and hopefully even a meeting in person with the principal, because if you’re a reasonable judge of character and you know what questions to ask, right?

I mean, it’s not just about finding out, you know, where Brian grew up and all of that, but that is very important. You know, it may be more important than asking what the cap rate is or what the IRR is or, you know, et cetera.

So I think that’s important. But then also the flip side of that is details matter. And details matter in the—you know, in your best day, how is everything going to go? And I mean for the fund or the syndication. And in the worst day, what happens? And, you know, then you can probably figure out the in between.

So, you know, I think that, and obviously more basic things like diversification, et cetera.

But also, you know, I think Buffett once said, you know, invest in stuff you use, you like, you eat, whatever. You know, he goes to McDonald’s every morning, right, for a sausage egg McMuffin and, you know, invested in McDonald’s a long time ago. How much stake does he have in Coke? Because he drinks Diet Coke like it’s going out of style, right?

So, you know, invest in what you know. I think about crypto as an example. I consider myself a reasonably educated individual when it comes to financial things. I don’t understand blockchain for two minutes. Right. So how in the world could I put my money there?

You know, and companies start to—when companies deviate from their core principles and get out of their comfort zone, that’s usually when things go wrong. And that’s companies, that’s syndications, that’s individuals.

So, you know what, if you can find, when you look at firms or syndications or whatever, you can find somebody that shows that they’re disciplined.

And I’ll think about Sunrise. It was mobile homes and all mobile homes. And then all of a sudden one day it was parking lots. And I thought, what in the world are they—what’s up with that?

And as it turned out, it was, you know what? We feel this will be a great complement. And in some ways, the margin may even be greater with maybe even less risk, right? They’re not building. I mean, they’re not going anywhere. You don’t have to do much with them, right?

So those are the kind of things. How I think about it, I think.

Brian Spear: Love every bit of it. Multiple, multiple golden nuggets on the way out there, Ron. Absolutely phenomenal stuff. Invest within your circle of competence. Details matter. And trust your gut.

Somebody once told me this lesson regarding my gut. I’ve come to know this about myself over time. And it is that my gut, the way I feel about it, is that if I meet somebody for the very first time or any interaction that I have with them, and my gut is off for whatever reason, my gut is telling me, the intuition that you have, something is off.

In 100% of scenarios where my intuition, my gut has been telling me that this is off, the prudent decision is to walk away from that respective relationship.

And when I do have a good intuition, a good sense, a good gut, a good feel, it is not to say 100% of times it will work out, but it provides me with the freedom to continue to pursue that and trust until proven wrong.

That’s how my gut has worked over time. But if I ever get the feel of ick—and you guys know what I’m talking about—if you ever get that feel, in 100% of scenarios, it has always been a prudent decision to move out of that and turn away and move on from that relationship for X, Y, Z reason. It just never has been the right move.

So hopefully that will help you out there again. Wonderful, wonderful. Multiple golden nuggets on the way out of the door here, Ron.

Well, let me just say thank you yet again for your time, your willingness to share your experience and all the lessons that you’ve learned along the way. I’ve learned a lot. I’ve taken some quality insights away from this conversation. I know that the listener has as well, buddy.

So appreciate your carving out some time to jump on and talk shop. I look forward to spending more time with you next time. Hopefully you get to come down to the investor event. Hopefully in Florida. It’ll be in, I think, February next year, or maybe early March, but hopefully we get to see you in the not-too-distant future, man.

Ron Assise: We’ll look very forward. And I’ll end with one thing that I didn’t say. And that is if it sounds too good to be true, it most likely is. And that’s a basic tenet, but definitely, it’s easy. It’s easy to forget.

So, you know, thanks for allowing me the time. You guys are great. I feel very, very blessed to call myself an investor. And, you know, at the end of the day, appreciate the opportunity to share my story.

Brian Spear: Again, very much appreciated, Ron. Wishing you and your family all the best on this next chapter of life, man. But we’ll get the heck out of here for today.

You know, I love this conversation with Ron. And to me, the biggest theme throughout the conversation was really about judgment.

Ron’s decision to sell his business wasn’t simply about finding the buyer willing to write the biggest check. He chose a partnership where he could remain involved, retain further upside, and continue contributing to the value of the larger company. And that judgment ultimately became an important part of his wealth creation.

But there’s also another side of that. Ron also talked openly about becoming too concentrated because he believes strongly in a particular operator, investing into deals where the assumptions might not have held well, and learning that even good people and good asset classes can’t eliminate risk.

And that’s an important distinction, and I believe it is why it is the sponsor’s responsibility to have a sound capital strategy that survives regardless of the greater macroeconomic environment.

For Ron, character matters. Track record matters. Details matter. Diversification matters. And as he said at the end, if something sounds too good to be true, it probably is.

The goal is not to just eliminate judgment from investing. You can’t. The goal is to build enough discipline around your judgment that conviction doesn’t quietly turn into overconfidence.

And as your wealth grows, the discipline may become even more important. When you no longer need the home run, protecting yourself from the unnecessary strikeout becomes a very different investing game.

That’s part of what it means to invest like a Sage. Know what you own. Know who you’re trusting. Understand what can break. And make sure that the risk that you’re taking still serves the life that you’re actually trying to build.

So thanks for spending some time with us here today. You be great.

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