Our model (buy, rehab, refinance to return capital, hold w investors forever) turns out to work well with the Opportunity Zone rules. Bizarrely, a few LA 'hoods, in which we've done ~20 deals, are OZs (bizarre bc they didn't need the help). Starting to look closely at this now.
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Think about things from the perspective of a founder or investor in a start-up that exits. If you do nothing, you will pay a huge chunk of your cap gain to the IRS. Pretty much only alternative is op zone investment.
While I underestimated the value of opp zone tax deferral from a startup or stock exit, I still don’t think it works with your model in a meaningful way. Opportunity zones are all about stepping up basis for cap gains or eliminating them. You don’t sell so it doesn’t matter here.
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I'll mark you down as a "no" for the first deal then :)
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Anything can happen :)
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Allowing investors to defer capital gains for 10 years today while getting a 15% step up in basis is attractive to HNW. Investors still pay taxes on the deferred amount (original investment) in 2026 regardless of sale or not. That could be a challenge
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You’re 100% sure you have to pay cap gains in 2026 irrespective of a sale?
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