Michigan City Opportunity Zone Funds
When the Tax Cuts and Job Act was passed by Congress in December of 2017 creating the Opportunity Zone (“OZ”) regulations, UDG quickly recognized its intent to spur high value-add real estate projects nationwide. In this regard, UDG, as a highly experienced developer/sponsor already operating in qualified OZ’s is a logical choice for investors with capital gain’s looking for quality OZ projects.
The OZ program offer’s investors three unique tax incentives for investing in projects located in OZ’s. Generally speaking, these are:
1. Deferral of Capital Gains – The income taxes due on proceeds from current capital gains re-invested in OZ’s can be deferred as long as until December 31, 2026.
2. Reduction of Capital Gains – after holding an investment in an OZ for seven years, the deferred capital gains taxes due is reduced by 15%.
3. No Capital Gains on OZ profits – after holding an investment in an OZ for 10 years, an investors disposition of an OZ investment does not result in any additional federal income taxes.
UDG intends to provide investors high quality, risk-adjusted OZ investment opportunities that leverage on UDG’s existing deal flow and track record, while capitalizing on further enhancement of project returns through the newly created OZ incentives.
UDG believes that Michigan City, part of the larger Chicagoland MSA at the eastern edge of rapidly growing Northwest Indiana submarket, is poised for phenomenal near term growth. UDG began making individual investments in Michigan City in 2015, and while steering those initial investments to incredible success, has developed an even keener understanding of the micro and macro economics of the local market place.
In 2018, when the US Treasury approved three Michigan City census tracts as designated OZ’s, UDG immediately moved to expand its deal flow in those two census tracts (in fact, several of its existing investments are already in these tracts), which has culminated in this presentation seeking a strategic OZ Fund or individual investor to partner with in the execution of the strategies herein.
For our initial Michigan City focus, we have three complimentary and strategic OZ projects requiring approximately $2,000,000 of investment.
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