The time is now
The rest of the city, the state, and even the country are just as dedicated to the economic prosperity of Brooks as the South Side. In recent years, Brooks has been designated a Tax Increment Reinvestment Zone and a Smart SA Innovation Zone by the city. It was also designated an Opportunity Zone by the federal government with support from the state. Each of these designations provides unique opportunities and benefits for potential investors.
The ultimate opportunity — investing in Brooks and the South Side
By Jim Thompson, Chairman and CEO of Preston Hollow Capital
A productive partnership
Preston Hollow Capital is a municipal finance business, and Brooks is one of our longest and most active borrowing relationships. We’ve loaned approximately $100 million over the period from 2015 to the present, supporting a variety of projects such as infrastructure improvements, restoration of Hangar 9 (listed on the National Register of Historic Places), public building improvements, and the 156-suite Embassy Suites hotel.
Since our first visit to Brooks in 2015, I’ve been impressed by the energy behind the bold vision of repurposing this former Air Force base into a vibrant community and an engine for economic development in the Southeast Side. Brooks is exactly the type of transformative story we look for in our investments, and we’ve been pleased to play a role in its success.
Seizing the opportunity
Opportunity Zones were created by Congress at the end of 2017 to encourage long-term investment in historically disadvantaged areas. Preston Hollow Capital created an Opportunity Zone fund last year and immediately began looking for suitably qualified investments. Once we learned that the Brooks campus was in an area identified by Governor Abbott for Opportunity Zone treatment, we immediately began speaking with Brooks’ President & CEO Leo Gomez and his staff about suitable projects at Brooks. This was an easy decision for us given our already substantial commitment to Brooks and our belief in its development story.
Together with the Brooks team, we identified an approximately 350,000 square-feet of light industrial development project and our Opportunity Zone fund has made a $22.1 million investment commitment to build it. This project will create jobs in the district and help continue to solidify Brooks as a thriving and diversified business center.
A sound investment
As an Opportunity Zone, Brooks offers many incentives to investors that are not often found elsewhere. Not only are capital gains tax deferred until 2026, but tax liability on deferred capital gains is reduced by 10% if investment is held for at least five years and by 15% if the investment is held by at least seven years. Furthermore, investors benefit from tax exemption of appreciation of the invested gains if the investment is held for at least 10 years.
As an Opportunity Zone, the prosperity that Brooks has brought to the South Side benefits everyone, from investors and small business owners to families and young professionals who choose to live and work on this side of town.
