Main Street Business
The Main Street Business Podcast hosted by Mark J. Kohler with co-host Mat Sorensen discuss complex tax and legal topics like LLCs, corporations, estate planning, raising capital, and retirement planning in an engaging and charismatic way, making it easy for anyone to understand.
Mark J. Kohler has done over +10,000 consultations with clients, is a Senior Partner at KKOS Lawyers and CFO/Board Member of Directed IRA Trust Company with $2B+ in managed assets. He’s a best-selling author of six books, national speaker and founder of the Main Street Certified Tax Advisor Program, a program training thousands of CPAs and Enrolled Agents on proven strategies, effectively changing the lives of millions of small business owners in America.
Main Street Business
#584 The Best Real Estate Opportunity in a Decade — Featuring Chris Loeffler from Caliber
In this insightful episode, Mat Sorensen sits down with Chris Loeffler, CEO of Caliber, to dissect the current state of the real estate market and why commercial real estate is presenting one of the best buying opportunities in over a decade. With over $2.9 billion in assets under management and development, Chris breaks down the macroeconomic and local market conditions creating value in distressed assets—especially in hotels, industrial, and multifamily sectors.
They explore how real estate investors can reposition capital, the shift from the traditional 60/40 portfolio, and how individual investors—accredited or not—can participate in today’s unique opportunities through direct deals or diversified funds. This is a must-listen for anyone managing a real estate portfolio, considering Opportunity Zones, or exploring how to use self-directed IRAs to tap into alternative investments.
See the market chart Chris refers to at 03:22 — Download the Guide Here
00:00:00 – Welcome to Main Street Business Podcast
Intro to the episode with host Mat Sorensen and guest Chris Loeffler.
00:05:46 – Why Commercial Real Estate Is At 2008 Pricing
Market correction parallels to 2008 and why it's creating a rare buying window.
00:11:44 – Commercial vs Residential: Sell Homes, Buy Commercial
Strategic shift: Why residential might be peaking while commercial offers upside.
00:19:15 – Office Buildings to Multifamily: Deep Discount Conversions
Case study on converting distressed office properties into profitable multifamily.
00:27:42 – Hotel Industry: Supply Shortage, High Demand
Post-COVID hotel trends and why Caliber is building ground-up in key markets.
00:34:08 – Investment Options: Direct Deals vs Fund Structures
How investors can participate—accredited and non-accredited—with flexibility.
00:42:44 – Distressed Asset Opportunities and Strategy
Accessing off-market deals and why experienced operators have the edge.
00:49:03 – Opportunity Zones Becoming Permanent Tax Code
What’s in the new tax bill and how OZs can be a powerful capital gains strategy.
00:52:43 – Final Advice: Value and Cash Flow Focus
Chris’s core investment principle: buy below replacement cost and cash flow strong.
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Welcome everyone to the Main Street Business Podcast. This is Matt Sorensen. I'm joined in studio by Chris Loeffler, ceo of Caliber, the wealth development company. The wealth development company. Thank you.
Speaker 2:Matt, good to see you. I know the marketing, I know the slogan.
Speaker 1:Chris has been on the podcast before. We've done webinars with them. He spoke at our Self-Directed IRA Summit, our Alt Asset Summit. He's going to be speaking at our next Alt Asset Summit, but I wanted to have Chris in the studio here to talk about why is now the time to invest in real estate. And then, specifically, is what to do when you're investing in real estate, like what type of asset classes should you be looking at? What type of markets Caliber does how much in real estate have you guys done?
Speaker 2:So we manage about 2.9 billion in combined assets under management and assets under development, which basically means that we're building stuff and we own stuff and a lot of stuff, and right now we're invested in hotels, industrial and multifamily. Those are the three asset classes that we think have the best opportunity across the country and we have the best access to um focused on Arizona, colorado and Texas. Good markets yeah and uh. You got to invest where you know, so that's what we do.
Speaker 1:Yeah and you guys got started like doing residential like way back in the day before you got into commercial and you became all big I mean Caliber's, like on the NASDAQ, you know. But like, yeah, you got started, just like a lot of people who might be listening. They're like I was buying single family rentals.
Speaker 2:I guarantee you there's people listening to this podcast right now that are thinking about buying their first rental property in their IRA.
Speaker 2:They're just kind of getting their toes in the water. That's the same thing that we did. We bought our first asset in 2008 at the time, and it wasn't a hotel, it was a single family home. We bought 50,000 bucks and we sold it in a week for a hundred thousand bucks and we were like, okay, we've got something here, so actually kind of relevant to our story today. You know, we were born in the 2008 financial crisis. We were born in a time when you could buy, you know, a single family home for $25 a square foot, something that would cost $300, $350 a foot to build today, and so the first five years of our business was all distressed assets, all buying things at a deep discount, all buying things the non-traditional way, and I've got news for you we're back in one of those markets.
Speaker 1:Yeah, that's the good news, and I think a lot of real estate investors have been like man, it's just not a good time to buy real estate right now. Right, I mean, the one concept most people know in investing is buy low, sell high. And I think a lot of people feel like they're buying high right now. Why do you think this is such a good time? I know you mentioned back where you got started, way back. I mean, man, it's been 15 years now, almost. But I mean, why is now the right time? And then let's dig into like, but what is what you're buying? Because real estate is like a super broad category.
Speaker 2:Yeah, so now is the right time. So why? Anytime there's a major disruption in real estate, a couple things happen all at once, and think of it as like we're going to start a race and there's going to be 10 players in the race and they're all going to be at the same starting line. They're all going to start running the race at the same time, and the reason why these things are complicated to explain is because the banks are moving at their own speed, the investors themselves are moving at their speed, the owners are moving at their speed, the government's moving at their speed. Everyone's running at different speeds, but at some point in time the race is going to come to a conclusion and we're right at that moment in time where we're hitting that. So let me give you some hard facts and some real details on why I've got a visual for you. For those of you on YouTube, you'll be able to see this, but for those of you who can't, I'll sit here and explain it to you.
Speaker 2:In 2008, at the height of the market, right before the pricing came down, we saw that the market hit all-time highs in commercial real estate and in approximately 12 months, maybe even a little less than that, by May of 2009, commercial real estate values had dropped more than 20% around 25% on average, hitting their all-time lows on average, hitting their all-time lows. But if you look back to May of 2009 and think about those days, if you were around during that time, it was sort of scary, but there weren't very many headlines yet, it wasn't in the news yet and in fact, it wasn't really in the news until the end of 2009 and then into 2010. So you would think, by 2010, 2011,. Geez man, every other day there was another news article about a bankruptcy or a foreclosure or assets going down or whatever. And you think, well, that would have been when the bottom of the market was. The bottom of the market in pricing was May of 2009. After May of 2009, you could never see a piece of commercial real estate sell for a lower number. So what's the lesson? The lesson is, in commercial real estate, values drop quickly. The market's perception of what a good deal and not a good deal is changes really fast, but the access to buy those deals takes time. So what happened recently? Well, in May of 2022, roughly right before interest rates started going up we saw an all-time high in commercial real estate values. That was the last peak. From May of 2022 till roughly September of 2024, we saw a similar decline, the same size as the 2008 financial crisis. So if you look at this chart, you look at the speed of the decline and the size of the decline. We just went through 2008 in commercial real estate nationwide. By commercial real estate, I mean everything from office to multifamily, to industrial to hotel. All of this is blended together. So where we stand today is we just saw the same bottom happen in September of 2024. We start to see the recovery here on this chart coming back up again, just like we saw the recovery at the bottom in May of 2009.
Speaker 2:This is what creates the buying window. So now, if I own a multifamily asset that I overpaid for, or if I own an industrial asset because I got invested in the craze and I overpaid for that, I know it's not worth what it used to be worth. The bank knows, everybody knows my cash reserves are running out. It's time for me to make a decision Do I sell or do I refinance? If I'm going to refinance, I've got to write a huge check into the asset. A lot of investors would rather take the tax loss and sell. A lot of the banks don't have any more time. The regulators are starting to tighten, so now is the time when these assets must be sold and that's where you create this buying opportunity. So that's why today, and going forward for the next I think 12 months or so is going to be the best buying opportunity in commercial real estate.
Speaker 1:Yeah, and I think this graph you can kind of see the big dip there and the times you're talking about and what's just happened recently in commercial real estate, you know, and that this, this thing goes back almost 30 years. I mean it's like 26 years of of history on pricing. So let's talk about what you're doing in commercial Cause you know I've been familiar with caliber and what you guys have been doing and you know this has meant being any endorsement or anything like that. I just know chris has a lot of expertise in this. I've been seeing what you guys have been doing is like, but you guys haven't been out buying recently, like in the last. I mean you haven't been super aggressive about raising capital or buying necessarily. I mean I think you've been doing deals here and there, but not like in a significant fashion, like so when you saw these prices go up. I'm just curious, like what's been going on the last few years for you guys versus like, how are you guys shifting today versus what you were doing the last three years?
Speaker 2:Well, in my business model it does not benefit us at all not to raise money and buy stuff, because we make fees from raising money and buying stuff, and so when you don't do that you're not making the kind of revenues that you typically make. But it also makes even worse sense for us to raise money and buy stuff at the wrong time.
Speaker 2:Because, ultimately the long term consequences of overpaying for an asset. And then you know the investors losing capital, us losing capital and us going through you know kind of the pain and suffering of that is really difficult. So, for better, for worse, in roughly you know, 2021 and 2022, caliber was a net seller. We were selling anything we could that wasn't bolted down and we did own a bunch of hotels. So we went through the pain and suffering of COVID and our hotels certainly lost money during that period of time. But, unlike a lot of hotel owners, we actually paid all the bills, kept all the debt current and found our way through COVID and now the hotels are starting to really recover. By doing that, we also stopped raising capital on some of our funds. We actually didn't launch a couple of funds that we were planning to launch and we waited and we thought the window was going to be 2024 early and we waited and we finally found our window. So we've relaunched the funds. We just opened a distressed asset fund. We've opened our second opportunity zone fund to back up for capital because we're buying distressed assets. In that we opened a fund that's buying income property but it's also trying to buy those at a discount. So again, that fund was just sitting on the sidelines and we're just out just ringing the bell telling as many people as we possibly can Even if you're a prior investor with us, invested in a hotel we didn't get the result we were looking for. Look, we went through a global pandemic. We're sorry, that was really difficult. We managed our way through it. But now is the time and our job is to stand in front of that, see around corners and help investors get invested at this moment in time.
Speaker 2:And what I will tell you that's different about this time versus 2008 was in 2008, everything crashed at once. All the residential crashed, bigger crash than the commercial. All the commercial crashed, all the values came down and then all the values kind of recovered slowly over time. What's different about this time is the commercial real estate values crashed and crashed quickly because there was mechanisms in place to deal with that. The residential values basically just hit their peak and kind of have modulated around their peak. Values haven't really come down. So one of two things is going to happen. One is gravity is going to occur and those residential values are going to come down. Or two is they're going to rapidly reduce interest rates and maybe you won't see the values come down. Either way, if you own single family rentals, now is the perfect time to sell those rentals. Own single family rentals? Now is the perfect time to sell those rentals, capture your gains and invest in commercial real estate at a discount. Um, that's kind of what I think. That's what I'm doing.
Speaker 2:That's what I expect, and I have no nothing against residential. We love residential assets, yeah, and if there is that crash, we'll be buying those too.
Speaker 1:Yeah, you'll, shift back there.
Speaker 2:Yeah, you're right back there buying those assets, but we want to buy stuff at a discount.
Speaker 1:Yeah, I mean you're, you're, you don't care what the asset is, as long as it's going to appreciate and create a greater return, and so this is a huge insight. Even as Chris and I were like coming up the elevator here to the studio, I was like, ooh, that's a really critical insight. Is you know I just know from talking to real estate investors, even myself being invested in some residential real estate is you know, you've, if you held it in the last you know five years, you've been like great, I made some good money, I've had some appreciation and you might think about selling. Maybe you're doing a 1031 exchange, maybe it's in your IRA, but you're like, ah, it's just not growing anymore. Maybe you've got an interest rate that could be changing in the future.
Speaker 1:It's shifted on you recently, depending on how you finance that. But still, pricing is pretty good for residential, versus if you're someone that owns commercial already, you're on the backside of this. Where pricing is down, you want to be a buyer right now, yeah, and so, whereas on residential, you might want to be a seller. So it's a good opportunity to look at your portfolio and think, well, should I be selling this residential that's priced pretty good right now you know, just because of where the residential market is versus the buying opportunity and the discounts where I can buy on commercial right now.
Speaker 2:Well, and take it one step further. We're talking main street business. We're talking to people who own their own businesses who probably have.
Speaker 2:You know, small businesses, medium sized, large businesses, etc. Valuations for businesses are still decent. Yeah, now's the time, like I mean a lot of wealth. Everyone talks about how you know the wealthiest people in the world have real estate investment. A lot of them made their wealth in an operating business but then kept their wealth by investing in real estate, and so talk about a good time to cycle. It's like okay, maybe you do take that private equity check, sell and then redeploy, but redeploy into assets that are priced well and be diversified.
Speaker 1:Yeah, well, let's talk about commercial real estate, cause that can mean a lot of different asset classes and there's different markets, of course, and opportunities where people can invest of different asset classes and there's different markets, of course, and opportunities where people can invest. Why have you picked the certain asset classes? I know you're doing ground up development, even on hotels specifically, and then you're buying some existing distressed assets and I want to talk about what you guys are seeing out there and why you guys are focused in those two areas.
Speaker 2:Yeah. So I'll talk big picture and then I'll show you an example. So big picture, the most distressed asset class in the country office. I think everybody knows why. That's pretty simple, right. But if you're a regional bank and you've got your loan book, maybe you've got 6% exposure to office. So even though it's a highly distressed asset class, it's not affecting your bank book nearly as much as you would think. Office is down around 40% peak to trough in terms of valuation. Just think about that in terms of a real estate typical deal. I've got $100 million office building. I've got 65% leverage on it. So I've got a $65 million loan on $100 million office building. If my office building is now worth 60 million, it's worth 5 million less than my loan balance and my equity is worth zero. So that's kind of a problem, yeah.
Speaker 2:That's happening across the country.
Speaker 1:Well, and I talked to a bank CEO recently actually in the Arizona market here, and they basically said them and some other banks have kind of got. There's been this extend and pretend type thing with their commercial loan portfolio where they were just hoping that rates were going to fall and that a lot of their borrowers would be able to recover. For their sake and for the bank's sake and for the borrower's sake, I mean, anyways, they're rooting for them. They don't want to take these assets back, no. But eventually their regulators start clamping down and they're like dude, you've got to resolve this portfolio and this is in default and so you're starting to see some action and like and so you're starting to see some action. We've seen that here just in the local market with pretty significant commercial properties going to auction and selling it massive discounts.
Speaker 2:Yeah, and you see that, if you see that once, you're about to see it a hundred times and if you see it a hundred times. You're about to see it a thousand times. It happens quickly and then it resolves and then it's gone. So either you're positioned well to take advantage of it or not. So the second most distressed asset class in the country, anyone know? I don't know. After office, multifamily Interesting Okay. Third most distressed asset class industrial Okay, and then hotel.
Speaker 1:Okay.
Speaker 2:So caliber is basically doing a couple of things. One is we're buying office buildings and I'll show you an example of an office building that we're actually doing, just so you can kind of get a case study on this Buying office at a deep discount to what it's worth, what it would cost to build, and then finding conversion opportunities. So if you just buy it as is and in this case we're buying this thing for about 20% of what it would cost to build you can release it as office to build. You can release it as office, but, as the last guy might've had to release it, you know, lease it at 28 or 35 bucks a foot to make it work. We can lease it for 15 bucks a foot to a call center and it still works for us. The second option you have is to convert it, and so you know this.
Speaker 2:This building I'll give you kind of the stats here we bought at 80% discount to replacement cost 65 bucks a foot, if you don't include the value of the parking garages, the two parking garages and the land. So it's a total of two office buildings, two parking garages and six and a half acres of additional land. Um, that's about, like I said, 15, 20% of what it would cost to build um, which is what you want to do in a distressed asset. You want to buy it at a deep discount to build costs.
Speaker 2:And then we're going to convert all of it into multifamily because they're still in a housing crisis. So we're still in an area where we need a lot of housing and it's hard to build new housing and you can't make the numbers work to build ground up construction. And when we get done with this conversion, we'll own it for about 60% to 65% of what it would cost to build new multifamily. So that's kind of the story of distressed assets is you want to buy them at a deep discount. You want to have a good turnaround strategy for them For multifamily. It's just math. The assets are performing really well at the multifamily level in terms of their profitability and their rate and their occupancy, but people overpaid for them and they used debt at 3% and now debt's at 6%. There's just nowhere to go.
Speaker 1:Yeah, and I think that's a difference between the office dynamic and the multifamily, whereas even as you're buying office, you're not repositioning in the office, at least in this scenario here. I mean, you talked about going to a call center or something like that, but you're repositioning to multifamily because, I mean, office is number one and it's got two problems right. It's got a vacancy problem and demand problem and it's got the same interest rate shifts that might have happened to certain buyers that didn't have fixed rate debt, that have penciled out their deal at a 3% rate environment and now they're on a 9% or 8% or 10%. But multifamily might have that debt issue and we've just seen this in some opportunities. We've seen people investing in here. But the one thing with multifamily is the demand's still there.
Speaker 2:Yes, yeah. So vintage is a big thing. In investing and whether you're investing in a private equity fund or a venture capital fund or a real estate fund, the concept of vintage is one of the most important concepts for anyone to understand.
Speaker 2:You can look at top tier venture capital investors across the country and, as long as you're working with somebody who's reasonably good, the only differentiator typically between the fund returns from Andreessen Horowitz versus another one would be what timing, what vintage, did you invest in the fund? And then, once you invested, what did the next 24 months look like in terms of the buying opportunities they had to deploy your money? And where were we at all time highs in company valuations? Are we at all time lows in company valuations? So kind of similar to the same thing in real estate funds and real estate investing. Your vintage matters and with multifamily, or industrial, it's just vintage.
Speaker 2:Did you come in before the highs and build into the craze or are you coming in now buying at a potential discount Office? Like you said, fundamental problem people aren't using offices as much. That's going to be a different kind of problem. And then hotel is kind of like a combination of all those things. The capital stacks are messed up so you can buy them at a discount, but people are using them at higher and higher volumes. So just to give you the hotel story in a short little clip, in 2020, january 2020, we had the same amount of hotel rooms we do today, five years later.
Speaker 2:Prior to 2020, there was going to be a hotel building craze. That never occurred because COVID happened and all those projects got canceled. Demand today is well above what 2020 demand was. So you've got a supply and demand issue. If I owned a hotel in 2020, before COVID, I had a bunch of cash reserves sitting around waiting to do my next renovation. Those cash reserves are gone. Had to use that to get through the COVID thing and pay my dad and that kind of stuff.
Speaker 2:But now the brands are saying look guys, it's been five years since COVID. We need you to renovate your hotel immediately, and if Marriott or Hilton is going to take their name off the side of your hotel, you're going to lose half your value overnight. So you've got to renovate the hotel. What you typically do if you don't have cash reserves sitting around is you go borrow more money against the asset. But you can't because interest rates are doubled. So hotel owners are facing a situation where their demand for their hotel is beyond any prior record, but they can't renovate the asset. They're facing a loss of the brand and they have to sell their assets just to create cash. So same kind of scenario all this disruption in real estate. What it creates for you is the best buying opportunity we've seen in at least a decade.
Speaker 1:Okay, let's, let's focus in on hotel for a second Cause you're doing like ground up building. I know we talked about some of the distress stuff, um, and I actually want to come back to that too. Well, let's say, let's stay on distress actually, and then I want to talk about the ground up stuff. So, okay, so you went over an example there. You're buying office.
Speaker 1:That's a distress, a significant discount to what you could build now, which is interesting because we went through like building a new office building in Utah and the bank was like, when we got all the bids, the bank was like wait a second, you know, replacement costs on this is like 40% of what you're trying to build this out. Right, they're like why don't you just go buy something? And we're like, cause it's in this dinky little town, cedar city, where there's just where we have an office and an amazing team, but there's just like not commercial office. You know there's houses and stuff and you can, there's bills and other stuff, but like, just not like office, and so, anyways, this has been an interesting of where like well, that's a perfect placement cost.
Speaker 2:That's a perfect corollary to the hotel thing, because where do people live and where do they travel now, different than what they used to before COVID? So even though in certain cases you could buy a hotel for less than build costs, you can't in a play in a market like Georgetown, which is outside of Austin, where we're building one yeah, it's the third. It like Georgetown, which is outside of Austin, where we're building one. It's the fastest growing city in the country of its size for the last three years. There's nothing there.
Speaker 2:And so you're capturing these weird movements of well, people are living in different places now, they're traveling to different places now and it's identifying these pockets where, gee, there was already an issue with hotel supply and now there's a massive issue with hotel supply.
Speaker 1:I mean, there's the overriding trends, of course, going on in the market here that we're talking about and you're like there's distress opportunities there's, but then there's this ground up development type stuff that you're doing in hotels and you have like a deal with Hyatt right, is that the one?
Speaker 2:Yeah, we're building a Hyatt studio there, which is an extended state hotel that was designed by Hyatt specifically after COVID, to kind of take advantage of the fact that travelers want different things now.
Speaker 2:They don't need their room cleaned every day, so we save a huge amount on room cleaning expense. They want an extended stay hotel, so they have a little kitchen. Because they may have traveled for business in the past for like two days and then rushed back home and now they're like, why don't I stay for a week? Yeah, and I'll turn this into a sort of a work, remote and vacation time, and I want to be able to cook in my hotel room because I don't want to go out to eat every night. So things have just changed fundamentally and we just announced about three weeks well, I guess maybe a month ago that we're doing a $400 million deal with Hyatt.
Speaker 2:We have the best contract in the country to build Hyatt Studios hotels and we're only building them. That's the only thing we're really focused on building in a programmatic way, and we're only building them in markets that are highly underserved by a hotel.
Speaker 1:Yeah, and markets that are highly underserved by hotel, yeah. And so the second piece of that is then like overall trends here, just sticking with this. But then you're looking at the specific market, because real estate is still local and like I don't know the hotel situation in Phoenix here, is it good or bad? I don't know. But you're like, no, we're going to this specific town, georgetown. It's had great growth, it's underserved in terms of this, of hotel, and so that's where it makes sense to actually go build. You got to, of course, recognize brand or whatever you have a agreement with. That's pretty significant. And so so you're like all right, let's go focus on that. We know we can make money there.
Speaker 1:So like, let's say I'm, I'm an investor, though Like I'm not going to go get the Hyatt contract, you know. But like I mean and again, this is not meant to be promotional or you know, do your own due diligence and everything but like, but like you're raising capital in that right now. Cause I know you were like we talked before too and you're like, you're like Matt dude, the last few years we were just like shelter in place because we didn't think the market was a great buying opportunity, and now we're seeing a couple of opportunities where we're really excited. So we're like we're going back out at hard to go raise, get deals done. So this is one. How does that look for investors? Is it specific to that type of strategy that you're raising for the fund? What is that? Is that accredited investors?
Speaker 2:Talk to me about that. Yeah, so I want to present to investors the opportunity to invest however you like to invest. So we give you options in this Hyatt deal as an example. You can invest directly into the deal. You can invest with your IRA or with your non-IRA funds. It's a $50,000 minimum accredited investor only pretty typical structure for what we do.
Speaker 2:But if you say you know what, I like that, but I don't want to pick and choose which deal is going to work, because Caliber is doing one in Georgetown and Austin and maybe I like that market, but they're also doing one in Steamboat Colorado and I don't know anything about Steamboat Colorado, so maybe I want to just be in a fund and so in that case we have funds and what we do with the funds is they lead the investment into these individual assets. They typically take the biggest chunk of the deal. We don't charge extra fees. You actually pay probably the same or less fees in a fund format than you pay in a direct investment format and you get diversified. So we offer both options for investors.
Speaker 2:And then, for the first time in Calibra's history, for a hopefully very short window of time, we're raising capital under a Reg A Plus offering for preferred stock. So if you are a non-accredited investor, you can invest with us in our preferred. It's a $5,000 minimum investment and it's available to any investor. So that's pretty rare for us. That's the second time in 16 years we've done something like that and if it works which we think it will we expect to kind of consistently do this style of investment to allow the non-accredited investor to get some exposure to real estate.
Speaker 1:Yeah, and I think that's been a trend is everybody wants access to quote, unquote, alternative assets or non-publicly traded assets. You've talked about real estate and why this is a time to focus on real estate, particularly in these areas where you guys are heading in the commercial space and distress in this kind of targeted hotel ground up development. And you know most people, a lot of our listeners, are accredited investors and you're familiar with that. You have to have a million-dollar net worth or 200,000 annual income single, 300,000 annual income married. But a lot more Americans are qualifying as accredited investors, just as, like, those numbers don't adjust for inflation and then people make more money or, with inflation, more and more people qualify and they think.
Speaker 2:I don't know if this is fully done yet, but we think at some point in time there's just going to be a test. You'll take a test and you'll say look, I understand that if Caliber says this is an illiquid investment, that means I can't sell it whenever I want, and once you pass the test, you can be accredited, which probably makes more sense than tying it to your net worth, because some investors have a very high net worth and not a lot of experience with investing, and some have a lower net worth and have a ton of experience with investing. So it just depends on that and hopefully at some point in time the SEC and the regulators will come up with that test and make it easier.
Speaker 1:Yeah, proposals have been floating around, but the nice thing is, for now you have the Reg A, so it doesn't matter.
Speaker 2:I mean it can be a minimum of $5,000, but you can also go more than that if that's what you want. Yeah for your self-directed IRA guys that have $13,000 sitting in their IRA that they got out of distributions after a couple of deals. They're like where am I going to put this $13,000? Come into our regular plus offering.
Speaker 1:Yeah, yeah, yeah, ok. So that was interesting though. So you have kind of and this is is your investing, you know, and you're looking at private investment alternatives you can so you allow them to go on on a specific deal, like, let's say, someone was like no, I like that Georgetown market and that opportunity there. I want to just be specific into that kind of like buying a specific stock. You know where you're like, I just want to buy Apple.
Speaker 1:You know that's the one I think is going to be the winner, rather than the whole S&P 500.
Speaker 2:Yeah, or they can custom build their own sort of caliber portfolio by saying, okay, I'm going to put 50 grand into this Georgetown deal, I like that distressed office deal, I'll put 50 grand into that and I'll build my caliber portfolio the way I want it built, not necessarily the way that Calibre's a fund manager wants to build it.
Speaker 1:So if you want to do that, you can do that too, all right, but you kind of have already like solutions of all right. Well, if you just want to put, let's say, 50 K in but you want to spread across, you know, the hotel, let's just take this as the example opportunity. There's a fund for that? Yeah, absolutely, and there's going to be more than a handful of deals going through there.
Speaker 2:And everybody's got their own flavor, Like some people want to time out all their positions and when they think they're going to get liquidity and that's easier on a single asset investment structure, and some people just want the the the comfy cozy blanket of diversification, which I think is the right way to go, but everybody's got their own point of view and you know, here in America you get to invest how you want, right yeah?
Speaker 1:I love that, ok. Well, let's flip over back to distressed for a second. So I know you talked about the office conversion to multifamily. What else are you seeing coming as distressed, and are you doing a lot of repositioning of what you're buying into something different, or is there still opportunity to just buy stuff as it is? And there's financing issues on the seller, what's?
Speaker 2:Yeah, most of the multifamily is just buy it as it is and just you come in at a cheaper basis, you have a good property manager and you just run it Well. Um, there's not a lot of huge repositioning opportunities. It's really just taking advantage of the capital stack on office.
Speaker 1:Yeah, you're going to reposition.
Speaker 2:you know most of the time you're, you're, you're changing the use, and industrial I mean. It's just. You know, at one point in time the last couple of years, if you said I've got an industrial deal in Phoenix, people were going to buy it, no matter what the price was. And, um, I think we're all coming back to reality that you, no matter what the price was, and I think we're all coming back to reality that you know you got to buy stuff at a good price. That's always been the way that investing works and I think that's what's out there right now. Having said that, you can buy the wrong office building in San Francisco at a phenomenal price and still be buried by that thing between taxes, inability to convert it, inability to get through local governmental issues Like there's. You do not want to be in this business unless you know what you're doing.
Speaker 1:Yeah.
Speaker 2:You know, I talked to a guy about a year ago and I might've told this story on the podcast before, so if I did, I'm sorry, but um, he called us because he had gotten a multifamily entitlement approved in downtown San Jose. Okay, heck, yeah, like, let's build multifamily in Silicon Valley in downtown San Jose. He's like you know, he must have been in his mid-80s and he said I've been working on getting this approval for 40 years. And we said 40 years. He's like all right, do you want to buy it? And I said no, it's going to take us 20 years to get design approval.
Speaker 2:No, there's no chance we're going to come in after 40 years of trying to get an entitlement approved. So you got to invest in markets that want you to be there as a developer, and we try to take advantage of that. And then there's all these little micro things. So we bought an office building in Phoenix. Okay, that office building is 15 minutes away from Taiwan. Semiconductors $160 billion investment in semiconductor manufacturing.
Speaker 1:We saw president Trump talk about that.
Speaker 2:Yeah, that was a big deal and um, and we we bought it because we saw a partner of ours convert another office, building a block away to multifamily. We saw their rents, we saw their returns. The banks are national. They're getting affected by the office performance they have in San Francisco and in Portland and places where they're getting really crushed. So office to them is a category and for them it's just like office equals bad. Office in Phoenix is like office equals bad. Yeah, office in Phoenix is not necessarily that bad, yeah. So we get to take advantage of that, because this macro trend that the banks are dealing with and the distress they have from their regulators and hey, you've got to get office off the books, I don't care what kind it is Then turns into a micro opportunity where it's like well, office in this specific location, in this specific area is actually a pretty good deal. So that's kind of the role that any investor needs to play is, you know you follow the macro trends, but then you get hyperlocal on the asset.
Speaker 1:Yeah, and the distressed area, because when you're let's again, I want to go back to like how you raise capital and just like investment opportunity is, do you have specific distressed funds? Then that's separate. If I'm more interested in like hotel development and I know you guys have done even specific, you've raised capital for opportunity zone type investors too. Maybe let's talk about that for a second, but because that might be coming back in the new tax bill, I saw that's in there, but yeah.
Speaker 1:So on the distressed side, like what are? If someone is like I believe in that thesis on distressed and this is a nice thing about investing and kind of taking control of your own financial future, your retirement is, think of the thesis of where sense to you, like, what do you believe in and what do you have conviction for? Get to understand the. You know whoever you're investing with. What's their capability, what's their track record? Do I feel comfortable with them? Of course, what's their investment offering?
Speaker 1:You know and look into the details, of course, but if I'm thinking of the thesis here and I'm like I believe in the distress thesis right now, I see that coming. I, you know, maybe I'm in residential right now and I want to reposition some of my portfolio. Or maybe I'm in the stock market and I have a and I believe that the stock market's over. You know it's at an all time high too and it's just not going to get the type of returns in the future. There's a lot of people in that line of thought, but I see the upside in distress. So how are you raising capital for distressed?
Speaker 2:How would I invest in that? I think you got to start with. How do you get in?
Speaker 1:Because I'm not going to go find those deals myself.
Speaker 2:You could try. Yeah, I'm not, I'm not. But first it's how do you get?
Speaker 1:in I might be able to get the single family distress deal and I think a lot of investors even that might be listening may have done that and have experience with that. Getting a distress commercial deal is a little different.
Speaker 2:Every deal has a story. So the Canyon deal, the one I just showed you guys, we found that a year and a half ago we negotiated for a year to get that done. We started with the seller, then we ended up negotiating with their lender, who eventually took control of the property, and then we went back and forth and then they had buyers at higher prices, so we said God bless. And then they came back to us and so you have to work the deal and every deal has a story. You're going to see that some deals will be extracted like over protracted over a long period of time, with that where you're dealing with different parties and you think you've got something done and then it ends up in bankruptcy. And now you're trying to be the stocking horse bidder in the bankruptcy and there's a lot of complexity around that and some deals will trade in a week with no fanfare and nobody knows about it.
Speaker 2:And so what we saw in 2008 was there was a mass volume of need for foreclosure across residential and commercial assets at the exact same time. What's different from then till today is that, because 2008 was such a big crash in real estate and was so deep, most of the financial institutions across the country created pretty sophisticated ways to deal with their distressed assets now. So there was no systems in place, no job titles, no software systems to manage these foreclosures. None of that existed back then. All of that exists today. So what that means is, if you're trying to get access to these types of assets, even though there's a big pool of them coming, they're likely going to trade much more efficiently. They're likely going to trade behind the scenes.
Speaker 2:You're not likely going to see quite the same amount of like oh, anybody can just get into this and leave their job and start buying auction properties downtown and that kind of stuff, which is how we got in.
Speaker 2:So you know, thank God we got in. But I think what's going to happen is everything's going to benefit the incumbents and you should be looking at as an investor. You should say let's look at the track record of who I want to work with. What are you looking for? Well, a lot of investors in the last couple of years got burned by the fact that they're like, hey, this is a hot new company. They've never missed a distribution, they've never had any problems in their career. I'm going to invest a lot of money with these guys because they obviously know how to do it right.
Speaker 2:And what they didn't understand is they're investing a lot of money with people who've never been through a cycle, and those companies are getting hurt right now because they've never been through a cycle. They didn't know what moves to make. They didn't know how the banks were going to react to them. They didn't. They're starting to lose assets and those were on the other side of that buying opportunity.
Speaker 2:So what you have to look for in the sponsors you pick or the people you're going to work with is show me your warts, show me your worst deals, show me the problems, show me how you dealt with it. And if you look through that and actually understand how they dealt with their problems and say, ah, they're making good decisions on my behalf, then you've probably found a winner. Because you're going to have to pick somebody who's an incumbent, who has real access to these opportunities, because most of them will come to me via a phone call. Bob the receiver, who knows caliber, will buy these things quick, knows that we'll move up, move this asset off the balance sheet, and they care about getting the assets sold to fulfill their mandate. They don't care as much about the price.
Speaker 1:Yeah, and they want certainty of execution.
Speaker 2:Certainty of execution. You know not somebody raising their first fund to try to take this asset down, or show me a documented track record that you can actually convert this 300,000 square foot office building to residential successfully, because if you can't, we know you're not going to be able to get a loan to close, and so they want to be able to see all that.
Speaker 1:All right. On Distress, though, you have a Distressed Fund. Is that accredited?
Speaker 2:investor Accredited investor. It's a brand new fund, new vintage. It's raised 500,000 bucks. We were going to open a year ago to go build new stuff and we said it's not a good time to build, let's make it our distressed asset fund and let's just sit on this fund for a year. And now it's open. We just launched it. We've just put in a new set of fees in there so that the first 20 million that come in get sort of like founders fee treatments.
Speaker 2:They get special treatment and what we're going to do with that fund is we're going to surgically buy dist, okay. And then our second opportunity zone fund is also buying distressed assets inside of opportunity zones. So if you have that capital gain event where you sold your business or you sold, you know, stock portfolio yeah.
Speaker 2:Hey, if you know, if your Tesla just hit an all time high, sell it. Take the capital gain, rebuy Tesla with, set a new basis and take your capital gain and put it into real estate. Not a recommendation, just an idea.
Speaker 1:Yeah yeah, that's kind of the tax play opportunity zones. If you're not familiar with that, we have other content on that where we've dug into opportunity zones and it's. It's a way you can sell appreciated assets, pay no tax on it, roll that gain. You don't have to roll the whole proceeds, just the gain part, which is unique, it's not like a 1031, just roll the gain into a new investment. That's opportunity zone qualifying.
Speaker 2:Yeah. So at the end of the day, you're selling something at a high and you're taking the gain that you get and putting it into a fund that's going to buy one or more pieces of real estate, hopefully at a low. So that's the play Sell the stuff at a high, buy real estate at a low and then create some more wealth and protect yourself from taxes. The big news can we break some big news?
Speaker 1:Yeah, yeah, let's do it.
Speaker 2:The House passed a bill about a month ago. The Senate, the Finance Committee, just put out their version of the bill and in the Senate's version of the bill, opportunity zones become a permanent part of the tax code. You get all kinds of additional benefits that are coming in and I think I project this is a forecast that when they reconcile these two bills, the Senate bill will win and we'll even get a better version that comes out of this. So if you're a tax professional, a financial advisor, and you were looking for like the all clear signal to include opportunity zones into your practice, now's the time. We help guys like you all the time um understand opportunities on investing. We'll teach you how it works. We'll teach you how to bring it to your clients. We do that kind of stuff because we're we were one of the first companies in the country to launch an Opportunity Zone fund. We've raised $250 million in Opportunity Zone capital, yeah, and we've done a bunch of projects so we can actually give you concrete examples of how to make these successful.
Speaker 1:Yeah, it's a pretty cool tax strategy. I mean, we advise a lot of clients on it. When the first round of Opportunity Zone passed what was that?
Speaker 2:2017 or so. Yeah, kind of like Jan 2018 was when it was made up.
Speaker 1:Yeah, and it was a cool tax strategy as we dug into it, because it was like this supercharged 1031, where you didn't have to buy asset of greater or equal amount. It was just the gain you needed to roll. But it wasn't just for real estate. You could be, like you said, selling your business, selling stocks, selling real estate, it was any type of capital gain and you could roll it into a new qualifying opportunity zone. And it's interesting because opportunity zones the whole purpose of it is. They were trying to identify these areas and there's these tracks, of course, right across the country that need development and that are distressed, right when they're trying to encourage investment, and so that's where you could go deploy that. But it's got to be a qualifying opportunity zone. And I've been tracking that tax bill too. I've done a lot of content on it, I geek out on it and I saw the opportunity zone in there and it's actually you're the first person I thought of when I saw that, because you've spoke a lot on it and I've actually learned quite a bit.
Speaker 2:Well, all of us in the industry were sort of praying because it was like this has been the most successful economic development in the history of the United States of America and it kind of it. Has some bipartisan support too. It does. It's across both sides of the aisle, and the reason why they want to make it permanent is it worked. They used, they deferred some taxes, the government didn't collect as much, but then that money was reinvested. Instead of into a stock portfolio or an offshore account, it was reinvested into Main Street, into downtown Mesa, where Caliber is redeveloping the downtown and rebuilding a downtown that had been left behind by the freeways 40 years ago. Those types of investments create a lot of local taxes, a lot of state taxes, a lot of employment taxes, and even though the federal government gave up some of their tax, what they are getting on the other side is a great trade and an increase in the tax base and an increase in the wealth of the country.
Speaker 1:Yeah, so well, you guys can look up on Opportunity Zones. Of course we're going to be tracking that with the tax bill. So you know, make sure you're subscribed here. Of course we'll be giving updates on the tax bill. So, um, you know, make sure you're subscribed here. Of course we'll be giving updates on the tax bill. I've got a lot of content on it, but we'll do something specific on opportunity zones, cause it is a really good strategy. We had hundreds of clients we were talking about that. Um, it's kind of died down a little bit. The opportunity zone is still there, but it's set to expire. Um, again, this bill, hoping it passes. We'll, we'll bring that back to life.
Speaker 1:All right, what other piece of advice do you have for anyone out there looking at real estate right now? I mean, what's your big takeaway, as someone who likes to invest in real estate, is looking for opportunity right now, is thinking about investment assets they already have or where to deploy some capital right now. And you can talk your book, that's OK. Again, this is just educational nature today. But, like, what's your number one takeaway here? I'm thinking just myself about investing in real estate right now. What should I be thinking?
Speaker 2:Yeah, so I'm going to treat you like I'm talking to my mom.
Speaker 1:Okay.
Speaker 2:So, mom, here's the deal.
Speaker 1:It's a little weird, but okay.
Speaker 2:Everything, but you got to advise people based on how you would do it or how you would do it for your family.
Speaker 2:And so, at the end of the day, what do you want to buy? You want to buy the cheapest asset you can buy at the best possible price that has the most likelihood to create cashflow and appreciate. How do we do that? Well, we look at what has had the greatest price declines and then we compare that to what it costs to build. And if you do that math, you do not need to just give your money to Caliber and trust us, that's going to be okay. You can do this math on your own and you can say gee, if it would cost $400 a square foot to build this building, and they bought it for $60 a square foot and when they're done converting it, they're going to own it for $200 a square foot, they're still in at 50% of what it would cost to build and they're in an asset class that can cashflow. Yeah, that is your analysis. It doesn't need it to be any more complicated than that, and anyone who over complicates real estate investing is probably doing it wrong.
Speaker 1:Yeah.
Speaker 2:So there's a very rare moment in time when you can do that, because in a normal real estate market, I can't buy stuff for less than what it costs to build. I have to build, and so I think that's what you should be doing as an investor, and you should find places to invest where, whatever amount of capital you have, you can deploy it into a strategy that actually works. All real estate is not good. Don't go buy overpriced single family homes in a hot market right now. If all you can afford to buy is one single family rental property, think about taking that and splitting it into a fund or a strategy that would allow you to buy two pieces of a commercial real estate asset. That's what I would be doing, because values have come down, and if values were at all time highs, I would be selling you on. Let's go build more stuff and sell it to the guys who are willing to pay us all time high prices All right.
Speaker 1:Great piece of advice. And I like one other thing you threw in there that we didn't talk about, which was that cash flows, and I think you know your example, of course, of the office to multifamily is a great example of that demands there there's definitely demand for multifamily again, depending on the markets. You're in, of course, but you want to make sure we have that ability to cash flow. You're gonna be able to carry the property because the appreciation and the pricing change is going to happen over time. Yeah, like there's a that's not like next year. You're not going to be like, well, let's, let's sell. I mean, you want to get the benefit of it rebounding and coming back over a window. And what type of time window should people be thinking about in in these types of investments?
Speaker 2:Unlike um. You know a hotel in time square or um, you know a beautiful home in that perfect location in you know, um I was going to say the Palisades, and sadly that that's a tough story for everybody but um, you know, in a beautiful location on the beach in California somewhere. Um, commercial real estate's value basically comes from its ability to produce cash, and if it's not producing cash, there's no value. You can buy assets that aren't producing cash, but as long as your end state is at the end of this, I'm going to produce a nice, healthy cash flow, which I would be looking for an 8% to 10% return on cost or better. So when I lever that, I'm into my double-digit cash flow. Don't buy it, don't do the deal, because commercial real estate doesn't just go up in value because it's a nice building. It goes up in value because the cash flows increase, and so that's the way that I would look at the types of timeframes I'm looking for.
Speaker 2:In distress is typically, you know, on a complicated commercial real estate deal, it's going to take you three years to turn it around. You're going to buy it. You're going to spend six to 18 months in development. You're going to spend another 12 months roughly in lease up and getting it back to cashflow and then you'd expect around two years to wind down because you don't know when it's going to sell. It could sell the day you complete it in year three, or it could sell two years from now because we're in a market disruption. So kind of that three to five year window is what we all target in the distressed and commercial and opportunistic style investing.
Speaker 2:And again, just historically speaking, I'm you know, I'm quoting you historical returns opportunistic real estate investing, which basically falls into two categories One is ground-up development and two is distressed or adaptive. Reuse turnaround has produced about a 12% annualized return unlevered over the last 20, 30 years. What that means is if you put some debt on there, you're making around 20% annualized in terms of your internal rate of return. If you're not making that, you're taking too much risk for the return that you're looking for. What happens in a distressed market is you can get typically another turn or better of that return by buying that asset pursuing an opportunistic strategy but buying at a deep discount to its replacement cost. So in a distressed market, I'm looking instead of to double the value of the equity in five years. I'm looking to get three to four times our money in five years because I bought it right, and that's where your protection is. Even in the worst case scenario, there's somebody else who will buy it for you for something. That's the goal.
Speaker 1:Okay, I have one more question.
Speaker 2:Sorry, I'm like.
Speaker 1:I just have one more question because I know you were just earlier this week. You were in Oregon speaking to a group of financial advisors talking about real estate. Most financial advisors are very familiar with the public equities. I'm just curious what the conversation is like when you're there with financial advisors. What are the questions they're throwing your way and what's the conversation with someone who's a financial advisor and a professional obviously looking for you know how do I allocate? They want to get good returns for their clients. They maybe want some diversification for their clients. People know real estate but, like, what's the conversation there? Are you talking about something differently? Or like, do you get different questions with the financial advisors?
Speaker 2:You know they um, they're a hundred percent focused on their client success and they're sometimes frustrated by if they're not fully independent. They can't access the types of investments that you can access as an investor directly. They can't just come to caliber. So what they're looking for is how do I get the opportunity is obvious to them, so we spend some time talking about that. Once they get it supply, demand, market pricing they ask all those questions, but we get through that really quickly. The next thing they want to get into is okay, how do I get access to this for my clients and how do I build around this as an anchor? It used to be, they used to call it the 60-40 portfolio 60% stocks, 40% bonds. Everyone says the 60-40 is dead and now it's a 40, 30, 30, 40 percent stocks, 30 percent bonds, 30 percent alternatives and real estate being the best alternative investment that those guys can typically access. So we spend a lot of time on fund structure. How much is being charged in fees? How much leverage are we using, because that creates risk. What happens if the distribution stop? How does my client get liquidity? That's where I get a lot of those financial advisory questions and that's what Caliber has, you know sort of.
Speaker 2:To give you my final pitch is try to present to the market is a public sponsor, so a public general partner of private equity real estate investments. So the company that runs the fund is the public company. But the company that owns the assets that the investors are exposed to is a private fund. So the investors are making decisions on the assets on a fund by fund or a deal by deal basis, but they have the comfy cozy blanket that the company that's running that is not a fly by night company. They're a NASDAQ company. The financials are transparent and I guess I'm not really tooting our own horn. Well enough, any investor can go in and buy our stock, so you don't have to be an accredited investor. You can get a little exposure to alternative investing through buying Caliber stock.
Speaker 1:Yeah, okay, awesome, one other, okay. Sorry, I'm just going to dig in on this because you actually wrote an article in Forbes. I remember this article. It's even in one of my decks where you talked about that traditional advisor 60-40, 60 percent of their investors or their client money is in public equities. The other 40 percent is in like fixed income bonds. Essentially, jpmorgan did a study and basically came up with actually the 40-30-30 that you talked about 40% equities, 30% fixed income, 30% alternatives is where they're going and JPMorgan is like the most Wall Street of Wall Street and their conclusion and again I read this out of your article was that their clients actually got greater returns and had less volatility in that 40-30-30 portfolio. That's right, and so, as advisors are going to that and we're seeing that too in our business more and more advisors wanting their clients to invest in alternatives and they're dealing with a lot of clients who are the mass affluent right and that mass affluent investor.
Speaker 1:Where do they have money?
Speaker 1:It's in their IRAs and 401ks and how do they access these alternative assets and so if you're someone that has like an IRA, just keep in mind your IRA can invest in private deals and like stuff that Chris is talking about here, these private funds, whether it's a Reg D fund, the Reg A fund, like if you're not familiar with this topic, we talk about it all the time.
Speaker 1:But when your IRA is like TD Ameritrade or Fidelity, you typically got a menu of what you can invest in and most people are investing in public stocks there. But when you're like, no, I want to do a real estate deal, I want to buy the duplex down the street or invest in a distressed fund, for example, well, you can do that with a self-directed IRA and you would move those funds from your IRA at Fidelity or TD Ameritrade over to directed IRA. That's our company that we have, where you can use your IRA to invest in quote, unquote alternative assets, but definitely a growing area and an area where people can invest in these types of opportunities. You can do it, of course, in your personal funds, but I just wanted to highlight that here for a second before we closed out.
Speaker 2:Yeah, you know I get to toot your horn now. You know Caliber is a unique company. We're one of the only providers of boutique small. You know. A $200 million fund in my world is a small fund.
Speaker 2:Most of my competitors do a $5 billion fund and they buy $200 million assets. And we're doing a $200 million fund buying $20 million assets, but out of the people I compete with that do that, the amount of them that have their funds available on Schwab or TD Ameritrade is almost zero. So, as an investor, if your advisor is only looking at what's available through those platforms, they may be missing an entire ecosystem of real estate investing. Obviously, we're trying to solve that problem at Caliber, but what I do with advisors all the time is I direct them to you, because you guys have the you're the time is I direct them to you because you guys have the you're the you're the easy button.
Speaker 2:They come to you and you will hook into their financial advisory software so that my fund will show up on their software, so their client can get a single statement. This is very important. Clients don't want to manage a hundred different positions in a hundred different places. You guys will run a really low fee model.
Speaker 2:I won't mention fees but, you'll run a low fee model so that they're not being charged and nickeled and dimed on every single position they take. They get a reasonable cost to custody their assets and your financial advisor must have a custodian to custody those assets. And so you, if you're an advisor, should talk to directed. But if you're a client of an advisor and the advisor is like, well, we don't really have Caliber or something like them on the platform, say, well, I found this company that I really like, bring directed to the table. The advisor can easily just move the account there and it'll show up on your statement. I'm making a lot of promises, your statement.
Speaker 1:Yeah.
Speaker 2:You know I'm making a lot of promises for you.
Speaker 1:Yeah, yeah, no, we've. We've integrated with Orion Morningstall by all accounts, and so we've definitely helped advisors when we have a relationship where we can share that data from our systems. And it's important right, Especially if you're an advisor, that this is a focus of your practice and you have a lot of clients you want to get into alternative assets using their IRAs. We also custody non-retirement accounts. So well, Chris, thanks so much for stopping by and for sharing all of your knowledge. We'll see you at the Alt Asset Summit. By the way, that's altassetsummitcom. Chris will be one of our incredible speakers there. That's going to be here October 16th 17th in Scottsdale, Arizona, at the Hilton here. We'd love to see all of you there and Chris appreciate you being here again and we'll see all of you next week. Thanks for having me.
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