On this week’s episode of Ritter on Real Estate, Kent Ritter interviews Lon Welsh. They unpack Lon’s “four pillars of diversification” framework—asset class, geography, strategy, and sponsor—digging into why he favors multifamily for stability, mid-size industrial for supply–demand gaps, and budget extended-stay hospitality for resilient demand. Lon explains blending value-add (for depreciation and cash flow) with ground-up development, and why property management selection is the single biggest driver of outcomes. The conversation also covers geographic risk (policy shifts, disasters) and why a Midwest/Sunbelt mix can smooth the ride for passive investors. 

Where to find Lon:

IrontonCapital.com

IrontonCapital.com/linkedin

IrontonCapital.com/facebook

IrontonCapital.com/youtube 

Key Takeaways

• The four pillars of diversification: asset class, geography, strategy, and sponsor—diversify across all four to reduce correlation risk. 
• Asset picks he likes now: multifamily for low volatility, mid-size multi-tenant industrial for scarcity, and budget extended-stay hotels for durable, non-discretionary demand. 
• Geography matters twice: politics (landlord–tenant laws) and physical risk (storms, fires) argue for spreading exposure across markets. 
• Strategy blend: prioritize value-add for immediate depreciation/pass-through tax benefits, pair with targeted development where shovel-ready and contingency-smart. 
• Sponsor & PM are critical: assess track record by product type/market, insist on contingency by line item, and scrutinize the property manager’s detection/solution chops. 

Books Mentioned

• Free book on passive real estate investing (Ironton Capital): https://irontoncapital.com/ritter
• Wall Street Journal: https://www.wsj.com

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Production by Outlier Audio