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Erik HaydenJul 16, 2021 10:33:43 AM6 min read

It Didn’t Take Long...

Moody’s, Bloomberg and CBRE nailed it when they predicted the San Jose area would bounce back quickly following the pandemic.

A quick recap of predictions. Last year:

  • Bloomberg’s analysis of 100 U.S. metro areas named San Jose the No. 1 region in the USA poised to recover quickly. The study looked at economic infrastructure, demographics and access to health care. Bloomberg attributed strong human capital, a highly educated labor force, and lower consumer debt to the high ranking of San Jose.
  • Moody’s analyzed 100 metro areas and ranked San Jose in its report of top 10 cities most likely to bounce back quickly. Researchers compared population density against the number of jobs and education level.

And back in February, CBRE’s U.S. Development Opportunity Index reported that San Jose offers the most favorable market for office construction in the U.S.

Fast forward to July 2021 and the news is filled with anecdotal evidence underscoring the resilience of the Bay Area:

  • The San Jose City Council voted unanimously in favor of Google’s historic Downtown West project, an 80-acre village with blocks of new housing units, office buildings, retail and parks.
  • Apple struck a deal to lease 701,000 square feet in a half-dozen large office buildings in Sunnyvale.
  • An investment firm out of South Korea paid $283 million to buy a new Mountain View building leased to Google.
  • LinkedIn purchased its global headquarters in Sunnyvale for $323 million.
  • The Silicon Valley Business Journal reported that the Bay Area is the top destination this summer as business travel rebounds
  • Costar reported that the “accelerating corporate investment in regional real estate suggests that Silicon Valley's office market is on the mend from the devastating economic impact of the dual health and financial crises.”

This rebound aligns with San Jose’s long-term commitment to strengthening its economy. The Bay Area is home to the largest tech companies and a concentration of top talent from around the world. And it is home to institutions like Stanford, UC Berkeley and San Jose State University, which are constantly churning out engineers. Meanwhile, a new report from PitchBook Data and the National Venture Capital Association says Bay Area startups have collectively raised $54.5 billion this year, on pace to easily break the $66.4 billion record set in 2018.

Interested in being a part of this exciting development? Contact us today.


Important Disclosures

The contents of this communication: (i) do not constitute an offer of securities or a solicitation of an offer to buy securities, (ii) offers can be made only by the confidential Private Placement Memorandum (the “PPM”) which is available upon request, (iii) do not and cannot replace the PPM and is qualified in its entirety by the PPM, and (iv) may not be relied upon in making an investment decision related to any investment offering by an issuer, or any affiliate, or partner thereof ("Issuer").

All potential investors must read the PPM and no person may invest without acknowledging receipt and complete review of the PPM.

With respect to any performance levels outlined herein, these do not constitute a promise of performance, nor is there any assurance that the investment objectives of any program will be attained. All investments carry the risk of loss of some or all of the principal invested. Assumptions are more fully outlined in the Offering Documents/ PPM for the respective offering. Consult the PPM for investment conditions, risk factors, minimum requirements, fees and expenses and other pertinent information with respect to any investment.

These investment opportunities have not been registered under the Securities Act of 1933 and are being offered pursuant to an exemption therefrom and from applicable state securities laws. All offerings are intended only for accredited investors unless otherwise specified.

Past performance are no guarantee of future results. All information is subject to change. You should always consult a tax professional prior to investing. Investment offerings and investment decisions may only be made on the basis of a confidential private placement memorandum issued by Issuer, or one of its partner/issuers. Issuer does not warrant the accuracy or completeness of the information contained herein. Thank you for your cooperation.

Real Estate Risk Disclosure:

- There is no guarantee that any strategy will be successful or achieve investment objectives including, among other things, profits, distributions, tax benefits, exit strategy, etc.;
- Potential for property value loss – All real estate investments have the potential to lose value during the life of the investments;
- Change of tax status – The income stream and depreciation schedule for any investment property may affect the property owner’s income bracket and/or tax status. An unfavorable tax ruling may cancel deferral of capital gains and result in immediate tax liabilities;
- Potential for foreclosure – All financed real estate investments have potential for foreclosure;
- Illiquidity – These assets are commonly offered through private placement offerings and are illiquid securities. There is no secondary market for these investments.
- Reduction or Elimination of Monthly Cash Flow Distributions – Like any investment in real estate, if a property unexpectedly loses tenants or sustains substantial damage, there is potential for suspension of cash flow distributions;
- Impact of fees/expenses – Costs associated with the transaction may impact investors’ returns and may outweigh the tax benefits
- Stated tax benefits – Any stated tax benefits are not guaranteed and are subject to changes in the tax code. Speak to your tax professional prior to investing. 

Opportunity Zone Disclosures

- Investing in opportunity zones is speculative. Opportunity zones are newly formed entities with no operating history. There is no assurance of investment return, property appreciation, or profits. The ability to resell the fund’s underlying investment properties or businesses is not guaranteed. Investing in opportunity zone funds may involve a higher level of risk than investing in other established real estate offerings.
- Long-term investment. Opportunity zone funds have illiquid underlying investments that may not be easy to sell and the return of capital and realization of gains, if any, from an investment will generally occur only upon the partial or complete disposition or refinancing of such investments.
- Limited secondary market for redemption. Although secondary markets may provide a liquidity option in limited circumstances, the amount you will receive typically is discounted to current valuations.
- Difficult valuation assessment. The portfolio holdings in opportunity zone funds may be difficult to value because financial markets or exchanges do not usually quote or trade the holdings. As such, market prices for most of a fund’s holdings will not be readily available.
- Capital call default consequences. Meeting capital calls to provide managers with the pledged capital is a contractual obligation of each investor. Failure to meet this requirement in a timely manner could elicit significant adverse consequences, including, without limitation, the forfeiture of your interest in the fund.
- Opportunity zone funds may use leverage in connection with certain investments or participate in investments with highly leveraged capital structures. Leverage involves a high degree of financial risk and may increase the exposure of such investments to factors such as rising interest rates, downturns in the economy or deterioration in the condition of the assets underlying such investments.
- Unregistered investment. As with other unregistered investments, the regulatory protections of the Investment Company Act of 1940 are not available with unregistered securities.
- It is possible, due to tax, regulatory, or investment decisions, that a fund, or its investors, are unable realize any tax benefits. You should evaluate the merits of the underlying investment and not solely invest in an opportunity zone fund for any potential tax advantage.

The above material cannot be altered, revised, and/or modified without the express written consent of Urban Catalyst.


Erik Hayden

Responsible for developing more than $3.5 billion in real estate projects, including over 2,300 residential units in the California Bay Area, Mr. Hayden has experience in acquisition, contract negotiation, due diligence, risk assessment, financing, construction, and disposition of multifamily, single family and large mixed-use and master planned developments. He maintains relationships with a broad network of property owners, enabling him to identify and acquire prime investments. Mr. Hayden also has expertise in navigating projects through the entitlement process by working with elected officials, community groups, and political organizations to gain support and get projects approved.