Caliber launched our flagship Opportunity Zone Fund in Q4 2018. In the United States, 8,700 census tracks received Qualified Opportunity Zones (QOZ) designations, and we have the infrastructure in place to find the right assets for our Fund.
Caliber has created a vertically integrated business which has allowed us to maintain control of the investment cycle, benefitting our investors through lower fees, higher margins, and the ability to navigate market movements.
As one of the first Opportunity Zone funds to market, we were able to parlay our experience into executing deals while concurrently raising capital.
With contributions from our investors into the Fund, our portfolio managers have invested the capital into five deals which we believe will help drive investor returns. As our Wealth Development team continues to source new money into the Fund, investors can be confident in our ability to deploy the capital as we have a robust pipeline of deals, roughly $250 million in project value.
Our focused investment approach on the greater Southwest (AZ, CO, NV, TX, UT) has served as Caliber’s competitive advantage since the inception of the business. The Caliber investment strategy is to focus on areas with population growth and income improvement, business and investment-friendly state and local governments, and to avoid direct competition in over-regulated and saturated markets.
By having this dedicated focus, Caliber has a ten-year track record of relationship building and has become a recognized contributor to the growth and improvement in these five markets.
The Fund’s newest asset is a 96-bed facility that will be occupied by the Medical Behavioral Hospital of Phoenix, LLC., and will care for patients struggling with medical and psychiatric conditions. Caliber purchased the asset for $23.4 million and has an appraised value (at close) of $28.4 million. Based on our financial projections, this project will have a project-level IRR of 22%, with a 19% IRR to investors.
Quarterly, we will strive to deliver updates to the investors, inform you of new assets into the Fund and provide the level of transparency that you deserve. We will continue to work closely with our partners to ensure our Fund abides by the rules and regulations of the 2017 Tax Cuts and Jobs Act. If new legislation is proposed, we will work diligently to be on the front lines of staying within regulations.
If you have any questions, please do not hesitate to reach out to our Wealth Development team (480) 295-7600. We are grateful for your trust and investment with Caliber and are here to ensure success in our Opportunity Zone Fund.