Real Estate Development Group

A distinct advantage Gateway Opportunity Funds brings to Opportunity Fund Origination and investing is its Real Estate Development Group.

The founders of Gateway Opportunity Funds are developers, that’s how they got involved with Opportunity Zones and Funds in the very early stages of the new law. Having found themselves with a parcel of land being named into an Opportunity Zone they set out to see just how this new tax law could help them in the development of the property. This lead to the creation of Gateway Opportunity Funds and its varied groups and associates.

As a land owner looking to take advantage of a real estate asset located in an Opportunity Zone, Gateway Opportunity Funds can assist you in the physical development a qualifying project, provide you all the technical knowhow to navigate all the rules and regulations of an Opportunity Zone, set up your dedicated Opportunity Zone Fund, and provide access to the investment community to fund your project.

How can a land owner benefit from being in an Opportunity Zone?

As a general rule, the OZ program provides tax benefits for investors in a qualified opportunity fund (QOF) that engages in business, including the business of renting real estate, in an OZ. Among other requirements, the real estate and other tangible assets used in the business generally must be acquired “by purchase” from an unrelated person after Dec. 31, 2017. In addition, property that was previously placed in service in an OZ will only qualify as qualified opportunity zone business property if it is substantially improved by the QOF. Given these basic requirements, how can a person who acquired property in an OZ prior to 2018 use the OZ program to raise capital for the purpose of improving the property or funding the start-up of a new business that will use the property? As explained below, an existing OZ property owner has a number of options, including selling the property to a newly organized QOF in which the property owner has a less than 20% ownership interest or leasing the property to a newly organized QOF.

Overview of Key OZ Requirements

The OZ rules are complex, and many requirements must be satisfied in order to qualify for the new tax benefits from owning and holding a real estate project or other business located in an OZ. Among the key requirements are the following:

OZ tax benefits are only available to an investor who recognizes a capital gain and, within 180 days of recognizing the capital gain, makes a capital contribution to a qualified opportunity zone (a QOF) that, directly or indirectly, conducts business in an OZ.
Real property in an OZ may be held directly by the QOF or by a subsidiary entity that qualifies as a qualified opportunity zone business (QOZB). In practice, due in large part to rules that severely limit the amount of cash and liquid assets that can be held by a QOF, in the vast majority of cases the OZ business will conducted through a QOZB (which can take advantage of a 31-month safe harbor for holding working capital).
For an entity to qualify as a QOZB it must be engaged in an active trade or business (which can include rental real estate) in an OZ and at least 70% of the tangible property owned or leased by the entity must be qualified opportunity zone business property (QOZBP).
To qualify as QOZBP, real estate and other tangible property must be acquired “by purchase” by the QOZB after Dec. 31, 2017 from an unrelated person. To be considered “unrelated” the seller of the property cannot own more than 20% of the capital or profits of the QOZB, either directly or by attribution.
If the QOZB is not the “original user” of the real estate, the QOZB must “substantially improve” the property. This means that the QOZB must, within any 30-month period following the acquisition of the property, make improvements to the property with a cost at least equal to the original cost of the acquired building (the cost of the acquired land can be ignored for this purpose).

Our Founders Are Real Estate Developers

With over 100 years of combined experience in most all aspects of real estate development the executives of Gateway Opportunity Funds real estate development group has the knowledge and experience to assist in any of the projects Gateway Opportunity Funds accepts into its family of Opportunity Funds.

More Protection for Investors (That’s a Good Thing!)

Our real estate development group can bring an opportunity zone land owners project concept to fruition.

In addition to working with opportunity zone land owners, having an experienced development group gives our investor comfort knowing if something were to happen to any fund sponsor/developer, our development group can step in and finish the project, protecting the funds investors and providing another opportunity zone project that benefits the served community. This could easily be the deciding difference in an investors choosing to invest in your project vs another project.

Gateway Opportunity Funds Real Estate Development Group Services offered:

Land Acquisition
Project Planning
Design
Feasibility

Zoning/Permitting
Project Development
Construction

We welcome the opportunity to discuss Gateway Opportunity Funds with you. Call us today:

864-GATEWAY (428-3929)

Gateway Opportunity Funds 11000 Riverview Dr. | St. Louis, Mo. 63138

DISCLAIMER

Gateway Opportunity Funds, LLC is organized and authorized under the laws of the State of Missouri Limited Liability Company Act, and is a qualified opportunity fund operating under current Federal Opportunity Zone Regulations as issued and updated by the IRS.

This is not an offer to sell nor a solicitation to buy securities of/in Gateway Opportunity Funds. Any investment in Gateway Opportunity Funds and only be through our current Private Placement Memorandum (“CPOM”). This offering has not been approved or disapproved or registered with the federal Securities and Exchange Commission or any state securities division. Investments in Gateway Opportunity Funds are available only to Accredited Investors as defined by the Securities and Exchange Commission. No Federal or state agency issued any notice as to the accuracy or adequacy of the CPOM or any other information contained herein. There may be limited liquidity in any opportunity fund investment.

No statements or documents contained herein are to be construed as Gateway Opportunity Funds providing legal, tax, investment or other professional advice. Please contact your own professional advisors to see how any investment in an opportunity fund may affect your individual situation.