Tag: investment strategy

Webinar 5 – Thrive in ’25: Faris Capital Partners

Introduction

The real estate investment landscape is ever-evolving, and one area garnering significant interest among Canadian investors is U.S. multifamily properties. In a recent webinar hosted by Westcliff, key insights into this lucrative market segment were shared by the Faris Capital Partners team. From exploring the intricacies of cross-border investments to understanding strategic execution, this session was a treasure trove of information for potential investors.

An Overview: Faris Capital Partners’ Approach

The session began with an overview provided by Kaz Jaffer and Addy Saeed, introducing the audience to the experts from Faris Capital Partners – Mark Faris and John Makarewicz. They dived into the ethos that drives their business, which fundamentally revolves around three pillars: Learn, Invest, and Manage. This philosophy underscores their commitment to providing an enriched investor experience, underlined by transparency and operational excellence.

Mark Faris’ Journey and Expertise

Mark shared his personal journey from playing hockey to becoming a pivotal figure in real estate, highlighting the transition from residential real estate in Canada to multifamily investments in the U.S. His realization of the untapped potential in the U.S. market, primarily in states like Florida, Georgia, and South Carolina, stemmed from challenges faced in Canada due to rent controls and other constraints.

Differentiators: Why Faris Capital Stands Out

Faris Capital distinguishes itself in the crowded investment real estate field through its robust team and proactive execution strategies. They focus on creating tax-efficient structures for Canadian investors, ensuring a seamless investing experience. Moreover, their unique 28-day transformation plan for property upgrades stands as a testament to their commitment to delivering value and enhancing properties swiftly to maximize returns.

John Makarewicz’s Insights on Investment Philosophy and Core Values

John elaborated on the core values and philosophies that drive Faris Capital’s operations. A genuine love of people, wise decision-making, and a commitment to first-class service are central to their operations. Their approach to investing is not just about financial returns but also providing an exceptional resident experience, ensuring longevity and stability in their investments.

Delving into the Multifamily Investment Thesis

Faris Capital’s investment thesis is built on acquiring assets that are well-located in economically diverse areas with population growth. They prioritize properties offering immediate cash flow and opportunities for value-add renovations. By targeting properties in business-friendly states with low crime rates and affordable housing, they mitigate risks and position for long-term growth.

Managing Risks: Climate and Insurance

A pertinent discussion point was the management of risks associated with climate and insurance, notably in states prone to weather impacts like Florida. Faris Capital proactively seeks out properties in safe zones and collaborates with robust insurance partnerships to ensure their investments are protected against unforeseen climatic events.

Investment Strategies for Canadian Investors

For Canadian investors interested in U.S. opportunities, Faris Capital offers a sophisticated structure via a Canadian Limited Partnership, which simplifies tax efficiencies and reporting. This strategy negates the need for double taxation and provides investors with U.S. dollar distributions, easing the complexities often associated with cross-border real estate investments.

Conclusion

The Westcliff webinar with Faris Capital Partners underscored the potential of U.S. multifamily investments for Canadian investors. Through their strategic approaches and unwavering commitment to value, Faris Capital offers a compelling portfolio option for those looking to diversify and capitalize on the U.S. real estate market. For more insights, investors are encouraged to reach out and explore this opportunity further.

Call to Action

To dive deeper into U.S. multifamily investing, consider booking a call with Westcliff or joining their investor network. Stay informed through their weekly podcast, and don’t hesitate to connect for further educational resources.

Contact Information

For more information, reach out to Westcliff via email at info@westcliffam.com or visit their website. For slides or additional details from the webinar, send a text with the word “slides” to 647 799 2264. Always consult with a professional advisor to align your investment decisions with your financial goals.

Webinar 3 – Thrive in ’25: Durum Industrial REIT

In a rapidly evolving real estate market, staying informed is more crucial than ever. On March 18th, 2025, a riveting webinar was hosted by Westcliff Asset Management, featuring insights from Simon Reddish of Durum Capital. This event, part of the “Thrive in 25” series, focused on industrial real estate and its potential as a lucrative investment opportunity. Below, we delve into the key themes and insights shared during the session.

An Introduction to Westcliff Asset Management

Kaz Jaffer, co-host of the webinar, kicked off the session by introducing Westcliff Asset Management. Westcliff’s business strategy revolves around three core elements: Learn, Invest, and Manage. With a profound commitment to investor education, Westcliff offers a variety of resources, including podcasts and webinars. The company’s strategic partnership with Waverly Corporate Finance allows them to cater to accredited and eligible investors looking for tailored investment opportunities.

Meet the Speaker: Simon Reddish of Durum Capital

Simon Reddish, a key figure at Durum Capital, joined the discussion to shed light on the company’s shift towards innovative and value-driven investments. With a diverse background in asset management and development, Simon emphasized Durum’s creative approach to uncovering investment value where others might not.

Understanding Industrial Real Estate

The discussion transitioned to a broader overview of industrial real estate. Simon highlighted that industrial properties, encompassing everything from distribution facilities to manufacturing sites, are foundational to our everyday lives. Each click online to purchase a product typically involves industrial facilities at some stage—from manufacturing to shipping. These properties generally involve long-term leases (5-15 years), offering stability and predictability for investors.

The Durum Capital Landscape

Durum Capital is characterized by its diverse fund offerings, including an Industrial REIT focusing on Canada’s Prairie Provinces, Durum Developments, a Carbon Fund, and an Opportunities Fund. Each offers distinct opportunities and challenges. Simon touched on the competitive nature of acquiring industrial sites, particularly post-COVID, and the impact of macroeconomic elements like tariffs on their investments.

The Durum Approach to Investment

Simon detailed Durum’s investment principles, highlighting their focus on tenant creditworthiness and the physical characteristics of the properties. Recent acquisitions, like a notable one in Edmonton, demonstrate Durum’s strategic approach. These acquisitions often involve improvements designed to enhance property value and tenant satisfaction, indicative of Durum’s hands-on strategy to add investor value.

The Future of Industrial Real Estate with Durum

Looking ahead, Durum Capital aspires to grow significantly, driven by its focus on the Prairie Provinces, which offers higher yields compared to markets like Toronto or Vancouver. This strategic geographic focus, combined with Durum’s commitment to creating value through capital improvements and opportunistic acquisitions, positions them uniquely against other market players.

Conclusion: The Westcliff and Durum Collaboration

As the webinar wound down, Kaz and Addy of Westcliff reiterated their commitment to empowering investors through education and strategic partnerships. For those interested in exploring more about these exciting investment opportunities, Westcliff offers several ways to engage—from podcasts to their online community.

For inquiries or a copy of the webinar slides, Westcliff can be contacted via text at 647 799 2264 or through email at info@westcliffam.com.

Understanding the Capital Cycle – Episode 2

In this episode of Smart Real Estate with Westcliff, hosts Addy Saeed and Kaz Jaffer explain the capital cycle of real estate investments, which includes acquisition, value enhancement, stabilization, and disposition. They emphasize the importance of market research during acquisition, implementing value-adding strategies, optimizing operational efficiency during stabilization, and timing the market during disposition to maximize returns. The hosts also remind viewers to seek professional advice for their investment decisions and provide contact information for further assistance.

Explore the crucial phases of the capital cycle in real estate investments on ‘Smart Real Estate with Westcliff’ with hosts Addy Saeed and Kaz Jaffer. This episode covers everything from the initial acquisition of properties to their eventual sale, emphasizing strategies to maximize returns at each stage. Tune in for detailed discussions on market research, value enhancement, stabilization, and timing your sales for maximum profit. Don’t forget to subscribe for more expert advice, and contact us at via call or text at 647-799-2264 for personalized guidance on your investment decisions.

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How does the Federal 2024 Budget impact investors?

The 2024 Federal Budget proposes a number of changes that have caused an uproar among voters and the LinkedIn community. We decided to discuss the changes and how they impact Real Estate Investors and Developers.

At a macro level, real estate is built and funded based on free-flowing capital. Our clients seek opportunities to place their capital and realize returns on it before moving on to the next opportunity. The returns generated are then used to invest in the economy by building businesses, innovation, and creating high-paying jobs for a productive workforce.

Canada has to compete at the global level for capital, and like anyone running a business, we need to be easy to do business with. The stance taken by the Trudeau government in this budget is the opposite of pro-investment in an era of anemic economic growth and next to zero job creation by a private sector grappling with high interest rates and tightened consumer spending.

The list below does not include every single change in the budget but rather the highlights proposed and their general implications for our clients. If you’d like to explore how these tax changes impact your portfolio or your real estate firm, feel free to reach out for a complimentary consultation at info@westcliffam.com or www.westcliffam.com. We are here to help you every step of the way in this challenging environment. Our team of talented real estate tax accountants can help you navigate through these changes.

Let’s dive right into our top 5 budget changes with their impact on Real Estate Investors and Developers:

  1. Increase in Capital Gains Inclusion Rate

I am sure you have seen a ton of articles on this, but at a high level, this change of the inclusion rate from 1/2 to 2/3 will likely increase property sales and investment disposition activity by June 24, 2024. For my realtor and investment advisor friends out there, buckle your seatbelts!

From a longer-term perspective, this is a terrible change for anyone making investments, building a business, or planning their retirement. In short, in most cases, you will have lost an extra 17% of your after-tax cash available to either make your next investment or retire.

This change does the opposite of incentivizing more investment and productivity, making tax compliance much more complicated!

2. Lifetime Capital Gains Exemption (LCGE) and Canadian Entrepreneur Incentive

Generally, this change provides additional opportunities to shelter more of the capital gains on the disposal of qualifying small business shares under certain conditions. Unfortunately, the incremental change doesn’t necessarily offset the negative impact of the increased inclusion rate in capital gains.

3. Home Buyers Plan Withdrawal Increase

Do first-time home buyers have extra cash in their RRSP to buy a property? Well, if you are one of the rare bunch who do, you can take out $60K per person instead of the $35K you can today with a 3-year deferral on repayment.

Similar to other incentives for home buyers, the main challenge is that we need more homes for them to purchase and more higher-paying jobs to give them the cash flow to qualify for these purchases.

4. Higher CCA on Purpose Built Rentals

Typically, buildings have a 4% tax depreciation and a half-year rule for the first year of putting them into use. You will now be able to write off 10% tax depreciation (CCA) for buildings constructed starting April 16, 2024, with move-ins by January 1, 2036. An additional incentive here is that there is no half-year rule if you put the building in use before 2028.

Unfortunately, these benefits aren’t realized until after you have built the building and are in the leasing up stage, which usually has lower income in the first year. The real challenge developers are having is to get a handle on the full costs of buildings, making a market profit, and ensuring the capital stack is viable. In most cases, this is a down-the-road benefit and doesn’t help us get more buildings built.

5. Higher CCA on Patents and Technology

In an effort to incentivize businesses to invest in patents and technology, the Feds have increased tax depreciation rates from 25%/30%/55% to 100% if purchased on April 16, 2024, and put in use by January 1, 2027.

This may help industries that spend a lot on technology and patents, so I will leave it to experts in those fields to give their opinions. From a real estate perspective, most of the software has moved to SAAS, and so the software is being paid for and written off as an expense during the contract, resulting in little to no impact. For those in the prop-tech space, this could be a great benefit!

You can find more information on the 2024 Canadian Federal Budget here.

Our team would be pleased to discuss how these changes impact your portfolio and real estate investment strategy. Feel free to reach out at info@westcliffam.com or www.westcliffam.com.

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