Wealth Development For The Middle Market, With Caliber Funds

In this webinar, Chris Loeffler reviews Caliber’s first Opportunity Zone Fund and discusses the pipeline for Caliber’s second OZ fund.

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You can visit the Official OpportunityDb Partner Page for the Caliber Tax Advantaged Opportunity Zone Fund II to:

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  • Learn key details about fund and related projects.
  • Request more information from the fund sponsor.

Webinar Highlights

  • An overview of Caliber’s business, including other real estate funds and private lending;
  • Caliber’s “middle market” approach, designed to take advantage of lower competition;
  • Geographic diversification that Caliber is pursuing in its second fund, including expansion into Colorado and Texas;
  • Review of Caliber’s leadership and strategic teams;
  • Caliber’s commitment to impact investing, including a quarterly impact report to its investors;
  • Caliber’s conservative approach to leverage in both Fund I and Fund II;
  • Plans to combine Opportunity Zone funds into a public REIT exit at some point in the future;
  • A review of assets in Caliber’s first OZ fund;
  • Structure of Caliber’s second Opportunity Fund;
  • Potential pipeline deals in Arizona and beyond;
  • Live Q&A with webinar attendees.

Industry Spotlight: Caliber Funds

Caliber Funds is the private equity arm of Caliber The Wealth Development Company, an Arizona-based corporation that services the capital of individual investors and disburses them into private real estate assets across the Southwest. Caliber offers a diversified portfolio of commercial real estate properties, real estate-related equity investments and other real estate-related assets, each of which Caliber Funds believes are compelling from a risk-return perspective.

Learn More About Caliber Funds

Webinar Transcript

Jimmy: All right. There’s Chris coming on now.

Chris: Good to see you, Jimmy.

Jimmy: Good to see you too, Chris.

Chris: Hope everyone’s doing really well. It’s wonderful to be here with you guys today. It’s a balmy day here in Scottsdale, Arizona, so if you happen to be in the Arizona market or wanna come visit us at any time, we’re headquartered in Scottsdale, come see us and we can drive projects and look at opportunities. So, we are Caliber The Wealth Development Company. We are in the business of building wealth for our investors. That is our mission. And among many things, Caliber is a sponsor of opportunity zone funds. We also do other types of real estate development funds, private lending funds, core asset investments. So, to the extent that you’re an investor looking to build your wealth with alternative investments and specifically with real estate investments in our region, we probably have a solution for you.

I decided to structure this as a kind of three-part presentation. This is actually the first presentation we’ve done on our new Opportunity Zone Fund II. So, we’re talking about Fund II now. Fund I was just closed recently, and Fund II is now open for business as of July this month. And so I thought I’d structured it by going through who’s Caliber as a sponsor, you know, so you have a little bit of background on us, and then I’m gonna go ahead and talk a little bit about what happened in our first fund so you can see how that turned out for investors. And then talk about the strategy and the pipeline for Fund II, which I think is probably very relevant for anybody seeking to place an investment today.

So, a little background on Caliber as a starting point. We are, like I said, a middle market alternative asset manager. And what that basically means is that we create different types of alternative investment structures. We actually create the structures, raise the capital, manage the investments themselves, report to you on a quarterly basis, you know, kind of provide you an investor portal and really manage your investor experience. And then we’re a vertically-integrated alternative asset manager, which means that not only do we raise and manage capital, but we actually go out and buy the projects ourselves, develop them, manage them from a high level, and then execute on the business plan, and eventually create the profits.

So, we are constantly involved in those assets and those investments all the way through the process, and we try to make sure we deliver on whatever it is that we said we were gonna do on each project. So, the company’s been growing significantly in the last couple years, as you can see on the board, and we have a pretty significant pipeline of what we call asset-centered development, which is land that we own and an estimate of what the cost of those assets will be to fully build out the projects that we already own. So, much of what I’ll show you is projects that we either own or control today.

The middle market is where Caliber plays. You’ll hear me talking about strategy a lot during the presentation, and so from a sponsor level or from a fund manager level, think of the strategy of Caliber as taking advantage of what we see as a dislocation in the middle market between the execution and the requirements for being a good investor and a very capable investor to deal with the complexity of middle market assets, which are typically $25 million to $50 million projects. You kinda need the same infrastructure you would need if you were doing $200 million or $300 million projects, but the lack of sophistication and the lack of companies that exist that focus on these middle market projects, which also happens to align really well with opportunity zones because if you look at the census tracks across the country, most of them have project sizes that would be more in the $25 millionto $50 million size versus these larger projects that exist.

So, Caliber’s an expert in this space and we take advantage of our expertise in the middle market to generate, we think, attractive returns. What that means for you is that we’re helping you come in at an early stage buying assets at the best possible price, which hopefully will give you the best possible return. We utilize the vertical integration of the company to execute on the services so that we’re not beholden to a general contractor that fails or a property manager that can’t execute. The middle market focus is really helpful in terms of finding…reducing, essentially, our competition for deals and making sure that you’re getting access to investments that are off-market or, you know, low…haven’t been marketed at a high level, and which is kind of the name of the game to investing well.

Caliber itself is focused…is like I said, based in Scottsdale, Arizona. We focus on states like Arizona, Colorado, Texas, Nevada, Utah, Idaho, places that have a proven track record of population and job growth, and that are markets that are sometimes overlooked by institutional capital so we don’t have to fight those guys for the projects that we invest in. And for Fund II, you’re gonna see a lot more geographic diversification. Our first fund was mostly Arizona projects. Fund II will have probably strong diversification between Arizona, Colorado, and Texas.

And as you probably all already know, all of these markets have pretty significant growth trends. The projections are all up and to the right. And a lot of that has actually accelerated because of the pandemic and because of COVID more and more people are moving into these markets. The other thing to know about Caliber from a sponsor standpoint is we have an extremely-experienced team that’s been working together. Most of us for the last, at least, you know, 5 to 10 years. The company’s been around for 14 years. And then this team is the executive leadership team. We actually have a 10-person strategic leadership team beneath this team that executes on all the different components of our business, and then a very stable and growing staff that helps us do all the things that we do.

And just to give you a little visibility in the things that we do, we have three essential engines to Caliber’s business. One is capital formation, raising and managing capital. Two is capital deployment, which includes generating our own proprietary deal flow so that we’re not buying marketed deals as much as possible, and doing some non-traditional acquisitions, including some distressed acquisitions, which is an interesting environment for that today. And then third is our capital management platform, which is asset management of the projects, fund management and fund reporting, and other types of high-level management. Last but not least before I move on, we are an impact investor. We do produce for you, as an investor in the opportunity zone funds, a quarterly impact report. So, you can see as an example, this is the most recent results from our first fund, about $112 million in GDP growth to date, close to 800 jobs created, and some pretty good results. So, you’ll see that every quarter as an investor in the new fund.

So, kind of taking you into the fund itself and the strategy, I’ll do a little high level on the new fund strategy, and then we’ll go into the results of the first fund, and then we’ll come back into the plan for the second fund. So, the strategy is opportunistic in the real estate space. What opportunistic real estate investing is, is it’s ground-up construction, adaptive reuse, heavy renovations where you’re probably renovating 70%, 80% of the building value or more. And in that case, you’re looking at the highest return profile in the underwriting for real estate investments. So, what that means is that other than doing distressed real estate investing, you’re gonna get the best possible return on your capital following this strategy.

Obviously, with the best possible return comes a higher level of risk. And the way that Caliber mitigates that risk in an opportunity zone fund, because many of our investors are putting a significant amount of their net worth into this, typically from the sale of a business or the sale of a major family real estate asset, we actually just limit the leverage. So, in our first fund, we did we set up a max leverage level of 50% loan-to-value in the fund. We’re currently operating at about 35% loan-to-value. And you’ll see that in Fund II, especially as debt costs go up, we’re gonna favor funding transactions with equity, both to reduce the risk and because the cost of debt is higher and therefore the benefit of debt is lower.

The second thing to understand about Caliber is that we’re…I think we are experts at maximizing the Opportunity Zone Tax Incentive. The major component to generating a great return for you as an investor in an opportunity zone fund is to grow the value of your capital over the 10-year period or longer. The more that we grow the value of your capital, the bigger the tax benefit is of not paying tax on the value…on that growth of that capital in the future. And so you have to invest with a company that is buying property at a great price in the beginning, that’s building significant value into that property, and that is hopefully taking your $10-million investment to a $20-million investment over that 10-year period or longer. That is what Caliber’s set up to do. That’s what we’ve been doing outside of opportunity zone funds since inception, and that’s what we do in the opportunity zone strategy.

The other thing that I think that is important to understand in our strategy is that we are not a single asset fund. You’re not making a 1 bet for 10 years on 1 project. You’re gonna be diversified across a group of projects. You’ll have some visibility to the types of projects you’re investing in because you’ll see what our pipeline is. And then you’ll be investing with us on future projects, just, you know, based on the track record of the company in the past.

The last two about compounding the gains and maximizing the exit, the benefit of compounding gains within the fund is that, again, the tax incentive is driven off of the value of your capital when you sell your interest. And so if we can buy a piece of real estate, develop a building, lease it up, sell it in five years, you know, go after a 2x equity multiple, which is our typical underwriting for that type of a project, and we can take a million dollars and turn it into $2 million, but we can do that again one more time through another five-year cycle, we can take the $2 million and turn it into $4 million. So, that’s our underwriting. That’s our plan in our funds. And by doing that and cycling those gains, we think that we produce a better result for you as an investor.

And then last but not least, because Caliber is building, you know, hundreds of millions and billions of dollars in AUM, one of our plans is to take our first opportunity zone fund, our second opportunity zone fund, and probably future funds, and roll them together as a public REIT exit at the appropriate time, which we think gives you the best possible outcome of flexibility to sell your shares when you wanna sell them, and the best possible price for your shares when you exit.

The other thing that you wanna understand is what does the fund sponsor have in terms of infrastructure to do this? I think the three things you really need is the fund infrastructure necessary to manage the fund. Caliber’s fund is audited by Deloitte. We have an in-house accounting and finance tax group that works together as a cohesive unit. So, that’s who’s managing this fund and making sure that we don’t miss reporting deadlines and we don’t screw up the allocations of cash in the different layers of the fund that we need, and that we can execute at a high level of complexity.

And then the second and third things, the track record and deal flow and the execution kinda go hand-in-hand. So, because Caliber’s been doing this for the last 14 years, we have regular deal flow of interesting projects walking in the door on a pretty much weekly basis. And then we have actually never not closed on a project we’ve committed to. And that track record of execution of closing and also execution through the process of finishing out the project builds confidence in the market, and that’s how we get to see interesting opportunities on a regular basis.

So, taking a step back, let’s talk about Fund I. I’m gonna go as fast as I can here so we can get to questions. But Fund I raised about $182 million. We had early investors that came in, came in at a dollar a unit. We’ve had a couple of revaluations in the fund, so they’re now at $1.35 a unit, so they’ve seen a 35% increase in their unit price, which is nice comparable to the stock market and other places where you’ve seen a pretty significant drop recently. The fund is essentially 16 properties and one business investment. The business investment is into an affordable housing manufacturer, essentially building housing units that the fund is stacking as apartments, so it gives us an opportunity to have direct access to do attainable apartment housing.

And the first fund essentially built a diversified portfolio of different investments. I’ll kinda walk you through a few of those just as a representative of transactions here. The DoubleTree Hilton Hotel in Tucson was built attached to the Convention Center in Downtown Tucson. The Behavioral Health Facility and the Roosevelt Townhomes, I’m gonna give you a little more details on. Second Avenue Commons is a workforce housing project in Downtown Mesa in Arizona. ZenniHomes is that stackable apartment concept. We’re in development on that. Haven’t built that one yet. And the Jordan Lofts is a loft apartment complex in College Station/Bryan, Texas.

So, this gives you a little look at the DoubleTree. We built it over a roughly two-year period. It was opened in March of 2021. It’s currently beating its budget and it’s rated as one of the best DoubleTrees in the world. Gives you a little view at what it looks like and what the final product looks like. These are actuals, not renderings. The Roosevelt Townhomes is a walkable…It’s a townhome project we built, walking distance to Arizona State University’s main campus and Downtown Tempe. And the strategy here was to build it out, lease them as rental on a for-rent project, but condo-map the townhomes so that we can sell ’em off individually after the 10-year mark. Gives you a little look at what the townhomes look like.

And then, great example of adaptive reuse. This was a boarded-up assisted living facility that we acquired. Gutted it, renovated it, turned it into a 96-bed acute care behavioral health hospital. Brought in a tenant who signed a 20-year lease. And valuation is estimated to be above $35 million on a $23 million cost basis. Great project. It’s producing cash flow at this point in time in the first fund, and hopefully we’ll start funding distributions at some point in the time in the near future.

So, Fund II opened in July of 2022. It’s July, so we opened it a couple weeks ago. And essentially we’re following the same playbook as Fund I. The benefit to Fund II investors is that the first fund in deploying close to $200 million in equity, has built a pretty significant pipeline of potential projects that Fund II can immediately start investing in and draft off of. So, instead of being a first fund where, you know, you’re raising capital and you’re getting the name out in the market, and you’re starting to build that flow, this fund will likely move faster. And so for investors seeking to find a good quality opportunity zone fund, we encourage you to take a look at this one. Interestingly, in this fund as well, we’ve added the ability for institutions to invest up to a certain maximum amount of the equity. So, we’re bringing in some institutional money alongside individual investors in the fund. And we’ve already identified our first project, which I’m gonna take you through here in a minute.

The structure of the fund, it’s a maximum offering of $250 million. Minimum hold time’s gonna be 10 years. Obviously, we’re gonna have a fundraising period. We’ve gotta close through that. And then there’s a period of time where we’re gonna invest and then hold the project so that every investor can have their full 10-year mark in the fund. So, I’m guessing it’s more of a 12 to 14-year fund in terms of a wind-down. Annual management fee of 1.5%. We have 2 classes of equity, 75/25 or 80/20 over $100,000 minimum or a million dollar minimum. And then there’s a 6% preferred return in the fund. And again, like I said, the fund was audited by Deloitte, and Mark Schultz wrote the fund, a great guy in the opportunity zone space if you haven’t met him yet.

So, some potential pipeline deals, the ZenniHome project I started to mention is likely gonna be funded by Fund II. This is a 90-unit multifamily project that’s gonna go over 10,000 square feet of retail in downtown. So, the first floor will be roughly 20-foot ceiling retail, and it’s gonna be a grocery. And then you’re gonna have a 6-story, 90-unit housing project that has studios and 1-bedrooms that are manufactured in a factory, and therefore, our cost per unit is closer to $80,000 to $100,000 per unit for the actual units that are going on the podium versus your typical cost for multifamily projects which is much higher than that, usually $200,000 to $300,000 per unit.

The Riverwalk Development is the largest and most exciting new project coming in. This is about 80 acres of development property in Scottsdale, Arizona. We’re gonna build entertainment, we’re gonna build industrial, we’re gonna build commercial. Multiple uses for this project. And the way to think about that as an investor is, you know, you wanna invest in the best possible opportunity zones in the country. This is in the center of the City of Scottsdale along the 101 Freeway. It’s an opportunity zone because it’s in Salt River Pima Indian Community, and therefore it’s on land leases, and so it requires a high degree of complexity to understand how to execute on the project, but we’ve got about a mile of frontage on the freeway in Scottsdale to build here. And that will be a collaboration between our first and second funds to invest in this project.

Sierra Bloom Medical Campus, I’ll show you where that’s located too. Same location as the Riverwalk Development. And the Second Avenue Commons is a workforce housing project in Downtown Mesa. So, this just gives you a view of that Riverwalk deal in that 80-acre project I mentioned in Scottsdale. Gives you an idea of where it is in the city, sort of in the middle of town. And all of the…nearly all of the dirt you see on the right-hand side with, you know, one, two, three, four, five, six, seven, eight, those lots, most of that is coming into the project and that’s gonna be where we’re gonna be developing additional property. That golf-looking thing is a Topgolf, and then there’s the Hampton Inn Hotel down there that Caliber owns in a separate fund.

And then just north of that project, right on the same freeway in Scottsdale, as you can see actually, just south of our company headquarters on the map, is the medical campus that we’re working on, investing in. We’ve executed an ROI on two different projects here, an 80,000-square-foot medical office building that you see displayed on the screen here, as well as an assisted living facility that we would be building. And so I just wanted to make sure you guys had a preview of Fund II. It’s an exciting time around Caliber. We’ve already started raising capital for the fund and we will deploy as we go. So, investors seeking a well-structured, multi-asset, diversified opportunity zone fund focusing on investments primarily in the Southwest region, I think we’re a great fit. And with that, I’ll end and we can go to questions.

Jimmy: Fantastic. Well, thank you, Chris. I’m honored that you presented the OZ Fund II to us first, it sounds like. I think that’s what you said. That’s pretty cool.

Chris: Yeah. This is the launch party. This is the first time I’ve discussed it with any investors outside of, you know, the one-off phone calls we’ve had with investors investing since we started the fund.

Jimmy: Well, that’s great. And a pretty good crowd here on hand for you to pitch to today. We’ve got several questions that have come in. John, I just answered your question in the chat about opportunity zone legislation, but if I didn’t answer that properly and you still have a follow-up question, feel free to post one there. Wayne asks, “Do investors have any say in your projects, Chris?”

Chris: Yeah. So, the fund actually has the capability to stand up an investment advisory board, essentially, where investors can have visibility to the flow of projects coming in. And the advisory board actually has a function within the fund which is to vote if there’s a project that we’re gonna invest in that would represent a conflict of interest for some reason. Those things kind of occur naturally in the sense that Caliber’s constantly doing deals and investments. And, you know, there might be some piece of land that we buy that has a piece that’s in an opportunity zone that Fund II might wanna buy the opportunity zone piece off of another investment. In that case, we defer the vote on the investment, the memo, and the decision to invest to the LPs so that the LPs are making the decision instead of the GP. But it just gives you some visibility as an investor, and if that’s something you’re interested in participating in, we’re happy to talk to you as an investor on that.

Jimmy: Yeah, a follow-up question he posted. He wants to know if investors can pitch ideas for projects in zpportunity Zones to you.

Chris: Oh, yeah. We get a lot of really interesting stuff from our investors. I mean, the Caliber community is interesting. We’ve got over 1,500 active accredited households that invest with us. Most of those investors are themselves successful people, whether successful business owners or sometimes real estate people, and so we get a lot of interesting opportunities that come from our investor base.

Jimmy: Excellent. This one comes from an anonymous attendee here. By the way, if you have any questions for Chris, please do use the Q&A tool in your Zoom toolbar in case you missed that announcement earlier. And we’re also going to be sending Chris into a breakout session. It’ll be a separate Zoom meeting that you can join. That’ll run for about 20 minutes and we’re gonna get that started in probably just another 5 or 10 minutes here. We’ll kick everybody over there if you wanna do that. And then meanwhile, here in the main session we’re gonna be having Ashley Tison play “Stump the OZ Expert,” and you get to ask him any questions you want. He’ll just run a live Q&A workshop for about 15 or 20 minutes. But to get back to the questions here today, an anonymous attendee asks this of you, Chris, “What markets in Colorado and Texas are you looking at?”

Chris: Yeah, so in Colorado, Caliber owns about 900 acres of development property just north of Denver in an area called Johnstown, which is right off the freeway near Loveland and Fort Collins. We’re building or developing at this point in time nearly $2 billion worth of real estate in that area, including residential apartments, office, medical, retail, a Catholic school, entertainment, you know, hospitality, you name it. So, it’s a really interesting project and it’s really drafting off of the growth of Northern Colorado and the outgrowth of Denver. Love that area. It’s not an opportunity zone currently, but to the extent that Governor Polis has an opportunity to pick another rural area with the next law that passes, we’re gonna advocate that he looks into that area because it’s still rural, it still probably fits the features, and I think it’s a great area for growth, certainly like the Aurora market, certainly like some elements of opportunity zones in Denver and, you know, that’s probably where we’re centered around.

In Texas, we opened our first office outside of Arizona in actually Downtown Bryan or in the City of Bryan, which is the sister city to College Station, which is where Texas A&M University is, about an hour to two hours between…driving distance in the center between basically Dallas, Austin, and Houston. College Station and Bryan were the fastest growing city in Texas last year, or I think either number one or number two. And what we’re investing in right now is Downtown Bryan, which is sort of like a downtown that was left behind. It’s an opportunity zone. We’re building housing there to add density, and we’re also doing some other interesting…we’re planning to do some other interesting developments in Downtown Bryan. I like Austin, Texas. My wife’s from Austin, so I’ve been spending a lot of time looking at Austin opportunity zones, and we’re constantly evaluating projects in Austin. And then, of course, Dallas and Houston are great markets as well. So, that’s where we’re looking in those three states.

Jimmy: Okay, perfect. Jeff asked a question about 80/20 equity split a couple presentations earlier. I don’t think we really understood what he said. And I wanted to kinda clarify, and he’s helped clarify as well, he wanted a little bit more color on your 80/20 carried interest there, Chris. I don’t know if you can pull that slide up again, but maybe you could walk us through exactly how a carry works in a private equity fund like yours, and how it ties into a preferred return.

Chris: Yeah, so our fund is structured with a preferred return of 6%. So, that means as an investor if you’re in the fund for 10 years, every year you’re accruing a 6% return every year for the year. So, you put in a million dollars, you’re getting $60,000 in accrued preferred return. And when the fund produces a distribution, you get 100% of that distribution until you get your first $60,000 or your first 6% on your million dollar investment. That becomes our hurdle rate, so if Caliber doesn’t perform at producing investments that produces 6% or better return, we get no split of profits. And that obviously is not…that’s contrary to our business model, so that’s how we align our interest with you.

As far as an 80/20 split over the 6%, what we’re structured as is that you then get 80% of the profits over that 6% return. So, to use a simple example, if we distribute 10%, you get the first 6% and then you get 80% of the remaining 4%. So, you as an investor would get around a 9.2% return on your investment, and we would get 0.8% in that particular example. So, that’s the structure. And the better the return that we distribute to you as an investor, the more our profit sharing starts to grow. And so our target return to distribute is certainly north of 10% because, again, the better the return, the better our outcome is and the better your outcome is. So, that’s the structure very simply put, but I can certainly go through the details in our breakout session if you wanna go through the exact waterfall process.

Jimmy: Yeah, thanks for that, Chris. And that waterfall structure or carried interest and preferred return are typical of qualified opportunity funds and other private equity structured funds, and it’s designed really to align the GP’s interest with the investors, the limited partners’ interests in most cases. And yeah, Chris, this is not exactly an anomaly. It’s very common in the wealth industry.

Chris: Yeah, and a way to think about that is that unlike a mutual fund or a stock and, you know, a single stock investment or, you know, some other investment like a bond fund, those funds are managed relatively passively. It doesn’t require a significant amount of execution ability to produce the return. That execution ability is really on the company’s shoulders, not on the investment manager’s shoulders. And in the case of an opportunity zone fund execution drives most of your return, execution meaning the ability to buy a great deal at a price below market, the ability to get the development completed and approved at the right cost, the ability to construct it, the ability to manage it. All those execution components drive significant value to you as an investor. And so in a private equity fund structure, you know, the fees are gonna be higher than like a mutual fund, but the reason why is because we’re getting paid for all that execution through the performance of the investment.

And like Jimmy said, you’ll see this in a lot of funds. What you need to be cognizant of is there’s definite different ways to do this type of a structure. As an example, in Caliber’s structure, there’s a concept that ensures that you have a return of capital in any capital events. So, if we refinance an asset and get a lot of loan proceeds and distribute those, you get 100% of those proceeds until you’ve gotten all of your capital back. Or if we sell an asset, you get a 100% of those proceeds until you’ve gotten all of your capital back. And you need that accelerated return of capital because you could conceivably be in a position where a fund manager does five projects, the first one’s a home run, they sell it, they take a profit split on that. The next four are losers, you don’t actually get all of your capital back, but the fund manager makes money. You don’t wanna be in that situation. So, it really does, you know, take time…take your time as an investor to do your diligence and understand waterfall structures.

Jimmy: Yeah, perfect. Yeah, thanks for the clarification there, Chris. I think that helps. And Jeff, hopefully that helped answer that question for you and possibly for a lot of others out there too who were curious about waterfall structuring. Moving along, we got time for a couple more questions here, and then we’ll kick you guys into the breakout session. If anybody wants to get to know Chris and his team more one-on-one and interact with them further, pick his brain on his investment strategy, please head over to that breakout session. I’m gonna post the link in the chat in just a minute here. Matthew asks, “Chris, you referenced your contribution to GDP. As an impact investor, do you think GDP is still a relevant metric to measure positive economic activity, or are there better metrics out there that we should be advocating more widespread adoption of like,” and he references, “the genuine progress indicator, the Happy Planet Index or OECD’s Better Life Index?”

Chris: Yeah, it’s a great question because everybody’s got their metrics they care about. And, you know, what we started with as a baseline since we’re still waiting, as you all know, for Congress to act on this bill, this reform bill to give us the metrics that the government wants to see. So, we just started with jobs created, GDP growth, business taxes created, local community taxes created. And the reason why was that this program was originally designed to be an economic development engine to create additional tax base so that the communities that were getting these opportunity zone investments could use that tax base to produce whatever social outcomes they want. So, the City of Mesa might need more funds for education versus the City of Denver might need more funds for public spaces, as an example.

And so our view from an impact investment is track all the things that generate that type of economic activity, whether that’s state, local or federal taxes produced, jobs created, that kinda thing. And once we get that tracking down and we’re doing a good job with that, layer in additional things that we measure. So, as an example, we started measuring hospitality beds created. And we’re likely gonna start adding in some housing measurements of adding certain affordable housing components to what we’re doing, but we wanted to start with the financial metrics because we thought that those were the easiest to obtain. And I’m 100% open to other metrics if you’ve got good ones you think we should add into the report.

Jimmy: Yeah, so reach out to Chris and his team. Chris’s email is on the screen right now, [email protected]. I’m sure he’d love to hear from you and from anybody else. And meanwhile, Chris, that’s gonna conclude our presentation here in the main session. I just posted the link to the breakout session Zoom meeting. Click on that link now. Head on over there if you wanna talk more with Chris and engage with him, one-on-one with Chris. And I believe one or two members of his team may be over there already or getting over there shortly as well. That’ll run for about 20 minutes, while meanwhile, here in the main session, we’re gonna have Ashley Tison up on stage playing “Stump the OZ Attorneys.” So, Chris, again, appreciate your time and your partnership with us on today’s OZ Pitch Day event. Have a great rest of the day and enjoy the breakout session.

Chris: Sounds good. See you soon. Thank you.

Jimmy: All right. Thank you, Chris.