History
The Coffeehouse Portfolio was popularized by Bill Schultheis in The Coffeehouse Investor as a simple, low-cost, diversified portfolio for ordinary investors. The canonical Coffeehouse structure is usually described as a 60% equity / 40% bond portfolio, with the equity portion divided into several equal slices: US large-cap blend, US large-cap value, US small-cap blend, US small-cap value, international stocks and REITs. This version is a simplified REIT variant: it preserves the Coffeehouse logic of broad equity diversification, value and small-cap tilts, explicit real-estate exposure and a large bond anchor, but compresses the stock sleeves into fewer categories for easier implementation.
Philosophy
The Coffeehouse REIT Variant is built around the same lazy-investing principles as the original Coffeehouse Portfolio: diversify, keep costs low, avoid market timing and capture the long-term returns of broad asset classes. The portfolio does not try to forecast winners. Instead, it combines a large bond allocation for stability with multiple equity engines: broad US stocks, small-cap value, international stocks and REITs. The REIT sleeve gives the portfolio explicit exposure to listed real estate, adding an income-oriented and inflation-sensitive component. Its strength is simplicity and behavioral durability. Its weakness is that the simplified version reduces the granularity of the original Coffeehouse model and may underrepresent some factor slices.