PEG Companies Announces Focus on Opportunity Zones with Launch of Qualified Opportunity Fund
Friday, March 29, 2019 9:40 AM
Commercial real estate operator's Qualified Opportunity Fund focuses on pre-identified projects
PROVO, UT / ACCESSWIRE / March 29, 2019 / PEG Companies (PEG) today announced the launch of a fund targeting $250 million in commitments for investing in the federal Opportunity Zone program which provides generous tax incentives to investors. Unique to the market, PEG's fund focuses on pre-identified, shovel-ready investments. The offering contrasts sharply with vehicles hoping to land attractive opportunity zone deals after raising capital from investors.
The Opportunity Zone program, established under the 2017 Tax Cuts and Jobs Act, provides special incentives for investors who substantially improve assets in more than 8,700 federally designated geographical areas across the United States.
The Utah-based firm specializes in urban infill redevelopment, with a focus on projects that incorporate government incentives. Prior to the introduction of the Opportunity Zone program, PEG built a long track record of distinctive and complex deals that align with the program's goals of driving real estate improvements and bringing new businesses to areas - many of which are now designated as Opportunity Zones. PEG's in-house expertise in deal sourcing and execution, as well as project and construction management, allows the company to provide this compelling offering.
"Deals that qualify for the Opportunity Zone benefits are right in our wheelhouse. We have a strong pipeline of qualifying deals - many of which we've been working on before the regulations came out and Opportunity Zones were identified," explained PEG Chief Executive Officer Cameron Gunter. "For the investor, this means that we are well-positioned to help them achieve the maximum benefits under the program by putting their money to work before the end of 2019."
Throughout 2017 and 2018, PEG identified infill sites for redevelopment in metro areas across Utah, Arizona, Minnesota, and California, before the Opportunity Zones themselves were selected, giving PEG a head start in providing investors access to attractive investments with the benefits of the Opportunity Zone program.
"When we underwrite our deals, we focus on the deal's fundamentals and maintain a pre-tax return target and location consideration that does not adjust whether it is in an Opportunity Zone or not. Most all of our current Opportunity Zone deals were in the works before the location of Opportunity Zones were published, so these first projects not only benchmark against a standard PEG deal but have also progressed through certain due diligence levels before the associated markets were labeled as official Opportunity Zones," said PEG Chief Investment Officer Soren Halladay.
Since its founding in 2003, PEG has developed or acquired over $1.5 billion in assets across the U.S. and Canada, garnering awards and generating strong returns for investors along the way. With numerous pre-identified Opportunity Zone developments, PEG has established itself as a leader in the Opportunity Zone space.
"As the rubber hits the road with Qualified Opportunity Funds becoming a reality, investors are realizing that there are very few shovel-ready projects for them. To get the maximum benefit under the law, an investor needs to contribute their gains to a Qualified Opportunity Fund before the end of 2019," explained Jameson Haslam, Chief Operating Officer at PEG Capital Partners. "We have worked with leading law and tax experts to structure our offering and ultimately provide maximum benefits to investors, while also controlling for some of the major risks and potential pitfalls facing Opportunity Zone projects."
PEG has held an initial closing on its first Qualified Opportunity Fund - PEG Opportunity Zone Impact Investors, L.P. The fund commenced in December 2018 and aims to invest in multiple projects, including infill redevelopments in high growth areas of Utah (Salt Lake City, Provo, Ogden), Arizona (Scottsdale, Tucson), Minnesota (Rochester), and California (Sacramento). Target developments include multifamily residential, hospitality, office, and mixed-use components.
"Ultimately, the Opportunity Zone program connects to what PEG does well - urban infill redevelopment and creative uses of space. We are excited to partner with communities to make the intended impact of this legislation a reality," Gunter said.
To learn more about Opportunity Zone investing, access a timeline of important dates/deadlines pertaining to the program, view PEG's pre-identified urban infill projects across the country, and calculate your potential after-tax returns, please visit www.opportunityzones101.com.
About PEG Companies:
PEG Companies was founded in 2003 and is now one of the fastest-growing commercial real estate development firms in the West. PEG focuses on developing quality projects that create value and return for its investors, end users, and communities. The PEG team offers considerable experience in project design, engineering, financing, city entitlements, tax incentives, construction management, marketing, and property management. PEG owns and manages over 35 hospitality assets across the U.S. and Canada, with over 4,230 multifamily housing units, and additional office, retail, and industrial space across the West. For more information about PEG, visit https://www.pegcompanies.com.
Ali Monsen | [email protected] | (801) 783-7334
Opportunity Zones 101
Related Video: https://youtu.be/QzdJSoEF2H4
SOURCE: PEG Companies