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Episode 57: Building Tax-Free Wealth with Derek Uldricks from Virtua Partners

I had the pleasure of meeting with Derek Uldricks, the President of Virtua Capital Management. Virtual is a global private equity firm specializing in the commercial real estate asset class. They invest in real estate across the United States. Their background is in commercial real estate financing, and restructuring and they have a very experienced executive team.

Virtua focuses on multi-family, single family, and hospitality. Derek discusses how they set up their real estate portfolios and mitigate risk.

When the downturn happened in 2008, there was a lot of investors with negative equity. They helped them turn around properties. Today his role at Virtua is to oversee the funds, inclusive of Opportunity Zone Funds and assist with investment decisions.

They are excited about Trump’s new Opportunity Zones. These are economic development programs in each state that are selected by the governors. They designate geographic areas with the intention of increasing investment therein. Investment in these areas receives favorable tax incentives if held for a ten-year period. These tax advantages include the ability to defer capital gains on any asset which is sold and used to invest in opportunity zones. The asset class can be anything, not just real estate so for those who have assets such as stocks, businesses, etc. those can be sold and used to invest. Any appreciation created could be entirely tax-free.

They watch the tax laws quite carefully and with that foresight they were well positioned to able to get in early on opportunity zones.

He discusses the differences between opportunity zones and 1031 exchange investments and why opportunity zones may be more advantageous. He feels that a market correction is coming based on market valuations and the yield curve.

They have two funds one for accredited investors, and they have a qualified purchaser fund for those with larger sized investible assets.

Talking Points From This Week’s Episode
• The benefits of tax law changes under the Trump administration.
• Tax benefits can be quite substantial.
• Virtua is one of the first companies set up to take advantage of opportunity zones.
• A market correction is increasingly likely.

About Our Guest
Derek Uldricks is President at Virtua Capital Management LLC. He is an experienced real estate private equity executive overseeing capital formation, investment selection and securities compliance for the investment funds.
His experience includes managing several commercial real estate investment funds covering a range of investment strategies: credit, land banking, vertical development, value-add, opportunistic, and aggressive growth.
Mr. Uldricks holds a Series 65 license from FINRA. VCM is in the process of registering as an investment advisor with the SEC and applicable US states and oversees compliance under the Investment Advisers and Investment Company Act, respectively.

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