Hurricane Ian Puts Squeeze on Tight Rental Property Market

In its September Rental Report, Realtor.com indicated that rents in certain metro areas that have been experiencing double digit year-over-year increases, such as Tampa-St. Petersburg-Clearwater, Florida, have started to cool and in some cases even slightly decline. In my opinion, the damage inflicted on communities by Hurricane Ian is likely to slow, and possibly even reverse, any rates of decline as fewer available units put the squeeze on already tight markets, particularly in states, like Florida, that are seeing huge inflows of new residents.

The sunshine state’s migration rate looks as if it won’t slow anytime soon. According the mortgage site, Movement Mortgage, “[o]ut of the 8.9 million people who changed their addresses at the onset of the pandemic, 28 percent of them moved to Florida. The state will have over 845 new residents every day for the next three years.”

Factors that I think weigh heavily within this trend include a perfect destination for family and friends to visit, zero state income taxes, broad cultural diversity, lower cost of living and an affordable housing and rental markets.

Another major draw is the robust job market. Florida’s labor force grew by 6.1% in 2021 to accommodate its rising job demands. Businesses operating in the state gained 11,900 private-sector jobs in the month of December 2021, while the private sector employment increased by 6.2% over the 2021 year. Plus, as a big-time retirement destination, the state also doesn’t impose any taxes on retirement income (including on pension income, income from an IRA or 401(k) or income from Social Security benefits).

These attributes are just some of the many reasons why Belpointe PREP, LLC (NYSE American: “OZ”) has made a number of investments in the state of Florida.

At Belpointe PREP (NYSE American: “OZ”), our business model is built around acquiring, developing and owning multiple properties in select cities where our research shows there is strong migration and employment trends, such as Sarasota and St. Petersburg, Florida, and Nashville, Tennessee, where we already have projects well underway. Some of the other markets that we are looking at include Raleigh, Durham, and Charlotte, North Carolina.

Investors that have realized capital gains in the past six months from the sale of stocks, real estate, a business, collectibles, planes, boats, livestock, cryptocurrencies, precious metals, an interest in a partnership, or other varieties of assets may want to consider reinvesting those capital gains into a Qualified Opportunity Zone Fund (a “QOF”) such as Belpointe PREP, whose Class A units are listed in on the NYSE American under the symbol “OZ” and can be purchased in the open market. Plus, there is no minimum investment amount; you can purchase as little as one Class A unit. Thus, pairing off realized capital gains against a liquid tax shelter, where no taxes are due from capital gains realized in 2022 (as long as you continue to hold the investment) until December 31, 2026.

Time is running out. As of this writing, any realized capital gains going back to April 23, 2022 qualify for deferment, representing a 180-day lookback. Make sure to shelter your or your clients’ 2022 capital gains before the 180-day reinvestment period runs out. Every day closer December 31 narrows the window to shelter capital gains for 2022.

What’s more, because Belpointe PREP, LLC (“Belpointe OZ”) is a publicly traded QOF, transparency is considerably higher than in that of many privately managed QOFs. In addition, while most other QOFs have limited or restrictive redemption features, Belpointe OZ unitholders can buy and sell Class A units in the open market.

One more key item, which I think is of huge importance, is that Class A unitholders of Belpointe OZ are not at risk of receiving and being liable for any future capital calls. Capital calls are an unfortunate feature many investors may regularly face in acquiring, developing and renovating private opportunity zone properties. Liquidity, no risk of capital calls and diversification put Belpointe OZ in the class of best qualified opportunity zone funds in my view.

Investing capital gains into a QOF, like Belpointe OZ, allows an investor to defer the tax payment on those capital gains through the earlier of tax year-end December 31, 2026, or the date on which the investor sells their investment or other experiences an inclusion event. Plus, all income and appreciation from the time one invests capital gains into a QOF through December 31, 2047, is potentially tax-free. We spell out how this alternative can work for you in our updated white paper.

Have questions about how Belpointe PREP, LLC (NYSE American: “OZ”) can provide opportunities for investment appreciation and income and help you or your clients to defer or eliminate capital gains tax obligations?

Call or email us and we’ll take the time to answer all of your questions about Belpointe PREP, LLC (NYSE American: “OZ”) and how reinvesting capital gains into a QOF can be utilized to offset tax obligations.

You can contact us at 203-883-1944 or IR@belpointeoz.com.

Cody H. Laidlaw
Editor-in-Chief
Belpointe OZ
255 Glenville Road
Greenwich, CT 06831
T: (203) 883-1944
E: IR@belpointeoz.com

Disclosure: Cody H. Laidlaw is the Chief Investor Relations Officer. Cody is also an investment advisor representative with Seaside Advisory Services, Inc. (d/b/a Seaside Financial & Insurance Services), a SEC registered investment adviser offering advisory accounts and services, and holds a long position in Belpointe PREP, LLC’s Class A units.

Important Information and Qualifications

Belpointe PREP, LLC (“Belpointe PREP”) has filed a registration statement (including a prospectus) with the U.S. Securities and Exchange Commission (SEC) for the offer and sale of up to $750,000,000 of Class A units representing limited liability interests in Belpointe PREP. You should read Belpointe PREP’s most recent prospectus and the other documents that it has filed with the SEC for more complete information about Belpointe PREP and the offering

Investing in Belpointe PREP’s Class A units involves a high degree of risk, including a complete loss of investment. Prior to making an investment decision, you should carefully consider Belpointe PREP’s investment objectives and strategy, risk factors, fees and expenses and any tax consequences that may results from an investment in Belpointe PREP’s Class A units. To view Belpointe PREP’s most recent prospectus containing this and other important information visit sec.gov or belpointeoz.com. Alternatively, you may request Belpointe PREP send you the prospectus by calling (203) 883-1944 or emailing claidlaw@belpointe.com. Read the prospectus in its entirety before making an investment decision.

This communication, including any links embedded herein, may not be distributed in any jurisdiction where it is unlawful to do so. Nothing in this communication is or should be construed as an offer to sell or solicitation of an offer to buy Belpointe PREP’s Class A units in any jurisdiction where it is unlawful to do so.

Neither Belpointe PREP nor any of its affiliates provide investment or tax advice and do not represent in any manner that the outcomes described herein will result in any particular tax consequence. Prospective investors should consult their own investment and tax advisers concerning the U.S. federal, state and local income tax consequences, as well as any tax consequences under the laws of any other taxing jurisdiction, in relation to their personal tax circumstances, which may vary for prospective investors in different tax situations.

This communication may contain estimates, projections and other forward-looking statements, typically identified by words and phrases such as “anticipate,” “estimate,” “believe,” “continue,” “could,” “intend,” “may,” “plan,” “potential,” “predict,” “seek,” “should,” “will,” “would,” “expect,” “objective,” “projection,” “forecast,” “goal,” “guidance,” “outlook,” “effort,” “target” or the negative of such words and other comparable terminology. However, the absence of these words does not mean that a statement is not forward-looking. Any forward-looking statements expressing an expectation or belief as to future events is expressed in good faith and believed to be reasonable at the time such forward-looking statement is made. However, these statements are not guarantees of future events and involve risks, uncertainties and other factors beyond Belpointe PREP’s control. Therefore, we caution you against relying on any of these forward-looking statements. Actual outcomes and results may differ materially from what is expressed in any forward-looking statement. Except as required by applicable law, including federal securities laws, Belpointe PREP does not intend to update any of the forward-looking statements to conform them to actual results or revised expectations.

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