How to take YOUR Small Business to a Publicly Traded Company Managing Alternative Assets
Dec 20, 2023
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Chris Loeffler, CEO of Caliber Wealth, shares the evolution of Caliber from a small business to a publicly traded company managing alternative assets. Topics discussed include real estate market dynamics, challenges faced by CEOs, developing a pickleball facility, benefits of being a public sponsor of private real estate funds, factors to consider when investing in alternative assets, investing in private funds through a self-directed IRA, opening a self-directed account and distributing funds, and offers of help from Chris and Caliber.
Caliber, a private company that manages commercial real estate assets, has grown into a significant publicly traded business.
Caliber offers alternative asset management, particularly in the distressed real estate market, providing solutions for long-term growth.
By going public, Caliber can attract talent, access better debt opportunities, and facilitate fundraising from larger institutions.
Deep dives
Caliber's Journey from Small Business to Publicly Traded Company
Caliber, a private company that manages commercial real estate assets and is now publicly traded, has grown into a significant business. They offer alternative asset management and their focus is on managing developed real estate. Caliber invests in real estate in any market condition, with a goal of helping investors make money regardless of market fluctuations. They provide solutions for distressed real estate markets, and investors can invest in their operating business through the public company, as well as invest in their real estate funds and underlying deals. By going public, Caliber can attract talent, access better debt opportunities, and facilitate fundraising from larger institutions.
The Beginnings and Evolution of Caliber: Flipping Homes to Managing Real Estate Funds
Caliber CEO, Chris Loffler, shares the story of how Caliber started as a small business flipping homes. They began in 2009, flipping 150 homes with 35 investors they randomly met at coffee shops. They offered radical transparency to investors, who would buy the house and pay for renovations. Caliber grew its business, and in 2013, they opened their first fund. They built trust with investors through education and offered opportunities to invest in home flips and private lending. Over time, Caliber evolved into managing real estate funds, with a focus on distressed real estate markets and providing solutions for investors to achieve long-term growth.
Exploring the Reasons for Going Public and the Benefits of REITs
Caliber made the strategic decision to go public due to their numerous partnerships and the need for the infrastructure of a public company. By becoming a publicly traded company, they can attract talent, access better debt opportunities, and facilitate fundraising from larger institutions. In particular, they have launched a private REIT focused on the hospitality industry. This REIT provides an opportunity for investors to own a piece of a billion-dollar portfolio of renovated hotels. Caliber aims to roll up private portfolios into the REIT structure to create liquidity for asset owners who can avoid taxes and receive better valuations. The REIT status also offers favorable tax treatment for investors, including those using self-directed IRAs.
The Rise of Hotel Investments in a Distressed Real Estate Market
Accounting for the pandemic's impact on hospitality, Caliber identified a unique investment opportunity in the hotel market. They found that many hotels were in need of renovations, as COVID-19 prevented planned renovations in 2020 and 2021. They also observed a reduction in hotel supply due to conversions into homeless shelters. Caliber recognized that hotels needed renovations and increased their investment appeal due to the shrinking supply. Leveraging their expertise, Caliber began acquiring hotels and forming a portfolio in multiple locations, including Virginia Beach. By providing opportunities to invest in the hospitality sector, Caliber aims to help investors benefit from the recovery of the hotel market while achieving long-term growth.
Investing in Distressed Properties: Lessons Learned
Investing in a distressed 25-unit building turned out to be a challenging experience. The initial plan to renovate the property for $400,000 ended up costing $4 million due to code upgrades and unforeseen expenses. Despite the difficulties, the investor's funds were preserved and rolled into another deal. The team's ability to adapt and find opportunities led them to purchase a neighboring three-acre piece of land to convert the hotel and the acquired land into 188 residential units. While facing setbacks, the importance of hard work and building strong investor relationships became evident.
Self-Directed IRAs and Opportunities Zones
Caliber offers investment opportunities for self-directed IRAs with a minimum investment of $25,000. However, all investments require accredited investor status. The discussion also touched on the benefits of investing in opportunity zones. The opportunity zone program allows investors to defer and potentially eliminate taxes on capital gains if invested in designated areas for at least 10 years. Caliber's expertise lies in finding deals within opportunity zones, offering investors the chance to diversify their portfolio and take advantage of the tax benefits provided by the program.
Welcome to this week's Directed IRA Special Podcast Episode! Today, we had the opportunity to speak with Chris Loeffler, the CEO of Caliber Wealth. Listen as Chris explains the story of Caliber—a journey from a private small business to a thriving publicly traded company managing Alternative Assets.
Join us as Chris shares insights into Caliber's evolution, the real estate market's current landscape, and valuable lessons learned along the way. Whether you're an investor, entrepreneur, or real estate enthusiast, this episode is packed with wisdom. Subscribe, hit the like button, and let's take control of our financial future. For more information on Chris and Caliber Wealth, check the links below!
