Tax Credits & Opportunity Zones
Ginsberg Jacobs focuses on assisting real estate developers in bridging the financial gap through tax credit financing and opportunity zones. We represent lenders, investors, and borrowers in connection with investments, leveraged loans, and real estate financing for projects utilizing various tax credits, including, New Market Tax Credits, Historic and Rehabilitation Tax Credits, Low Income Housing Tax Credits, and Energy Credits, as well as opportunity zones.
Our attorneys structure and document these transactions to allow our clients to maximize the benefits of these transactions. Ultimately, we have saved entire development projects by finding government credits that work toward the bottom line.
The New Markets Tax Credit (NMTC) promotes investment in low-income communities by providing tax credits for qualified investments. Qualifying areas are determined by the prior census; therefore, the areas that qualify for such credits are often surprising. Our attorneys have assisted clients across the nation, in transactions involving hotels, shopping centers, community facilities, office space, and mixed-use developments.
An Opportunity Zone is another economic development tool that incentivizes investment in distressed, low-income communities by temporarily deferring taxes on eligible gains. Taxes are deferred if such gains are invested in a Qualified Opportunity Fund organized for the purpose of investing in Qualified Opportunity Zone property. Greater tax benefits can be realized the longer the investment is held. Qualified Opportunity Zones are economically distressed communities that were nominated by states and certified by the U.S. Department of Treasury. Opportunity Zones can be used by developers who are looking for new sources of capital to complete local projects that otherwise would not have attracted private investment.
The Historic and Rehabilitation Credit plays a vital role in the financing and development of historic preservation and affordable housing projects, as well as retail, industrial, office and mixed-use real estate in low-income communities. We bring a unique perspective to preservation matters as a result of our involvement with charitable organizations dedicated to preserving historic structures.
- Structuring leveraged New Markets Tax Credit transactions including preparation of Qualified Low Income Community Investment loan documents and leverage loan documents
- Structuring non-leveraged New Markets Tax Credit transactions including negotiation and preparation of loan documents
- Structuring Opportunity Zone transactions including formation and structuring of a Qualified Opportunity Fund, creation of a Qualified Opportunity Zone Business, and investment by the Qualified Opportunity Fund indirectly into the Qualified Opportunity Zone Business or directly into the Qualified Opportunity Zone Property
- Structuring Historic and Rehabilitation Credit transactions using direct and pass through credit structures
- Structuring and preparing offering documents for Tax Credit syndications
- Managing Twinned Credit transactions combining New Markets Tax Credits with Historic or Rehabilitation Credits
- Developing strategies for avoiding credit recapture in troubled credit transactions