Adding commercial real estate to your portfolio can provide balance

It is generally agreed that a balanced portfolio will also include real estate (not your primary residence) in some form. This could be direct ownership in a condo or a second single family home or a portfolio investment.

The CalTier Fund gives you ability to add commercial real estate and enjoy all the benefits without most of the risks and headaches typically associated with this asset class. How much you add to your portfolio is up to you.

 

 

Confident Businesswoman

For example purposes only. Not an actual

portfolio suggestion.

CBRE forecasts that the Multi-Family Industry will increase by 33% in 2021 and 2022 and that there is a projected 3 million shortfall in Multi-Family units over the next 10 years.*

Many people believe that having around 30% of your portfolio allocated to cash-flowing real estate provides some level of resilience to market ups and downs.

Multi-Family Real Estate is considered one of the most stable real estate classes mainly because it can be leveraged typically 70% with debt and with already paying tenets, has built in cash-flow on purchase.

 

 

*http://cbre.vo.llnwd.net/grgservices/secure/US-Outlook-2021.pdf?e=1620108584&h=5333351d9644dac9acbe53e899d62547

La Zenia

Investing Into C and B Class Multi-Family Assets With Value-Add Opportunities

We invest into multi-family units that fall into the Class B and Class C categories. We intend to use substantially all of the proceeds of this offering to acquire, manage, operate, leverage, and opportunistically sell multi-family rental properties and development projects through purchasing equity interests in those properties. 

Class B

Class B is the next highest asset class, some characteristics include that they tend to be:

●Older than Class A buildings

●Often higher vacancy rates and less affluent tenants;

●Less desirable location than Class A buildings and they can be professionally managed; and

●There may be some maintenance issues.

Class C

This class is sometimes described as “value add” because with some renovations and improvements assets in this class can be elevated to a higher class. Some characteristics include that they tend to be:

●Older than 20 years;

●Less desirable locations and at times, poorly managed; 

●They have some maintenance issues which need fixing

The Multi-Family Value-Add Lifecycle

1

Identification

& Underwriting

Together with our partners and extensive network we find, and underwrite assets for the fund.

2

Acquisition

& Financing

Once we determine it fits the funds investment profile we negotiate, arrange financing and close on the asset. 

3

Property Man

& Renovation

Through the lifestyle of ownership either directly or with our partners the asset is renovated then property managed. 

4

Sale

At the end of the planned lifecycle of the asset we put the property up for sale and look to achieve the best price possible