Retirement often brings a shift in financial priorities—from building wealth to generating sustainable income and preserving assets. While stocks and bonds remain common tools for meeting these goals, many individuals are exploring real estate investing in retirement as a way to add variety to their portfolios and support long-term income needs. Passive real estate investments, in particular, may provide retirees with consistent cash flow and diversification without the responsibilities of hands-on property management.  

Why Retirees Are Exploring Real Estate Options  

Real estate can serve multiple roles in a retirement plan. For some, it provides rental income that complements distributions from retirement accounts or Social Security. For others, it’s a long-term asset that may help balance risk in a portfolio primarily composed of market-based investments.  

In retirement, investors often prioritize stability and predictable income. Real estate investing in retirement can potentially align with those priorities by offering income streams that are tied to property leases or distributions from pooled investments. Additionally, because real estate often behaves differently than equities or fixed income investments, it can add an element of diversification to a retiree’s financial strategy.  

What Are Passive Real Estate Investments?  

Many retirees want the potential benefits of real estate ownership without becoming landlords. Passive investment vehicles offer exposure to real estate markets while delegating day-to-day responsibilities to professionals. Common passive options include:  

• Real Estate Investment Trusts (REITs): Public or private entities that own portfolios of commercial or residential properties. They typically distribute income to investors on a regular basis and can be accessed similarly to mutual funds.  

• Real Estate Syndications: These involve pooled funds from multiple investors to purchase and manage larger properties. An experienced sponsor manages the property and oversees operations.  

• Delaware Statutory Trusts (DSTs): DSTs allow fractional ownership of institutional-grade real estate and are often used in 1031 exchanges to defer capital gains. They provide investors with income distributions and professional management, without requiring active oversight.  

These structures allow individuals to participate in real estate investing in retirement without the obligations that come with property upkeep, tenant management, or renovations.  

Tax Planning Considerations  

Real estate investing in retirement also introduces several tax planning opportunities that may support long-term income and asset preservation goals. For example, individuals who sell appreciated properties may defer capital gains taxes through a 1031 exchange by reinvesting the proceeds into qualified real estate, such as a DST.  

Additionally, depreciation and other property-related deductions can sometimes offset a portion of the income generated from real estate investments. These elements can play a role in broader income and tax strategies, particularly for retirees focused on long-term planning.  

Aligning Real Estate with Retirement Goals  

As with any investment, the suitability of real estate in retirement depends on a person’s risk tolerance, income needs, and financial objectives. . Others, like DSTs or syndications, may involve longer holding periods and limited access to capital.  

Assessing how much of your portfolio to allocate to real estate—and whic Passive real estate investments, such as publicly traded REITs, may offer some level of liquidity. types of real estate investments are appropriate—should be done within the context of your overall financial plan. It’s also important to consider how these investments may impact cash flow, taxes, and legacy planning goals.  

At SouthPark Capital, we support clients in evaluating real estate options alongside other investment strategies to help create diversified retirement plans tailored to their unique needs.  

Consider Real Estate Investment Strategies with SouthPark Capital  

Real estate investing in retirement may offer a way to generate passive income and add diversification without taking on property management responsibilities. Whether you’re considering REITs, DSTs, or other real estate vehicles, SouthPark Capital helps clients explore options that align with their retirement timelines, cash flow goals, and tax strategies.  

If you’re interested in learning more about passive real estate investing and how it may fit into your retirement plan, contact SouthPark Capital to schedule a consultation and start the conversation. We look forward to speaking with you!