Opportunity Zones: The Basics

The talk of “Opportunity Zones” seems to be growing with each passing month,  though there is not a lot of information available. Opportunity Zones are a great way to not only receive tax benefits, but help better economically stressed communities in the process. This article helps acquaint those unaware of Opportunity Zones with how they work, and what makes them so important for the future of redevelopment efforts across the US.

Hazel Park
Hazel Park in Michigan is an opportunity zone site that used a preemptive vapor barrier, MonoShield to protect against environmental issues. Hazel Park is benefiting from a new development, which will stimulate jobs, promoting growth within their city.

What is an Opportunity Zone?

In 2017, Congress established the Tax Cuts and Jobs Act to aid economically strained communities by turning designated areas into a potential real estate investment. By using private investment funds, the communities would benefit from economic growth while investors would receive tax benefits by re-investing their unused capital gains into Opportunity Funds. Today, up to 25% of low-income neighborhoods  qualify, in a state, territory, or district are eligible for qualification. Once an Opportunity Zone is created in a certified area, it holds onto that title for 10 years until it is time for the zones to be re-evaluated.

Investing in an Opportunity Zone

If planning to invest in an Opportunity Zone, there are a few requirements that should be taken into consideration. As an example, with a real estate investment, there are certain restrictions put in place to ensure that the property in question is, in fact, bettering the community. For these real estate investments, properties can be either built or remodeled. It must be known though, that if an investor is choosing to remodel, there is a minimum on how much the investor must invest in the project. Say you, as the investor, bought a pre-existing building for $2 million and only wanted to upgrade/remodel it, in order to comply with the Opportunity Zone rules, you would need to spend at least $2 million and 1 dollars. An investor must put more into the project more than the amount they purchased it for – even it that means the investment is only $1 more than the purchase price.

opportunity zone
In order for a site to qualify for the opportunity zone program, it must bring value to the community.

It is also essential that investors note there are “right” and “wrong” types of investments, especially when it comes to real estate. As an example, the “wrong” investments are those that are not much use to community, with examples such as country clubs, luxury housing, gambling facilities, and liquor stores. Keep in mind, communities where Opportunity Zones are located are those with greater financial hardships. The examples provided either create greater financial burden for the residents of the community or are of no use to them. The goal of the Opportunity Zone project is to improve and bring wealth to low-income communities, not to bring in establishments that can do them more harm than good.

The “Right” Investments – Real Estate Example

It is essential when choosing a real estate investment to keep in mind the question of “is this bettering the community”? Great opportunities can come in the form of business parks and warehouses, due to their ability to generate job growth. In 2015, Ashley Capital began a project to turn Hazel Park Raceway, a horse track in Hazel Park, Michigan, into industrial offices and warehouses. The project generated 675,000 square feet of the manufacturing and industrial space now known as the Tri-County Commerce Center. The raceway was located in an Opportunity Zone, so Ashley Capital would receive the provided tax benefits for building within the zone, all the while creating the possibility for job growth in the area.

What is an Opportunity Zone Fund?

Opportunity Zone Funds are a way for investors to invest in Opportunity Zone projects. They are a US corporation or partnership planning on investing at least 90% of its holdings into a qualified Opportunity Zone. They can be used, as stated before, to start ground-up on new buildings, or significantly improve existing ones. These investments allow investors to receive tax benefits immediately and long term on capital gains.

When using an Opportunity Fund to invest, there are three different types of investments that are available. The first is through partnership interests in a business that operates within an Opportunity Zone; the second is owning stock in a business that executes all of its projects and affairs in an Opportunity Zone, the third, is by investing in property located within an Opportunity zone such as real estate.

If looking at it on a 10-year timetable, like the one provided by fundrise.com, there are a few crucial years to  note. For the first year, taxes are deferred on the capital gains. For the 5th year, the tax on the capital gains will be reduced by 10%. On the 7th year, tax on the capital gains is reduced by 5% from the 5th year now making it a total of a 15% reduction. On the 10th year, the capital gains taxes are eliminated on potential profits from the Opportunity Fund. It is important to note that in order to take advantage of this program, an investor has to take their capital gains and invest it into an Opportunity Fund within 180 days of the sale of the asset.

According to Adam Hooper for WealthManagement.com, “Essentially, the federal government is allowing the investor to keep the capital gains at 0 percent interest and use those funds to invest in one of these Opportunity Zone projects for 10 years. After 10 years, the investor pays no capital gains tax on the appreciation of the asset”.

How REGENESIS and Land Science Can Help

When investing in an Opportunity Zone, there may be a unexpected issues that come with the land. There is a possibility that the previous inhabitants of the site created negative environmental impacts, and cleanup may be necessary before further progress can be made.

That’s where REGENESIS and Land Science can help. As investment continues into Opportunity Zones, developers will increasingly look to develop brownfield sites – properties with environmental impacts preventing redevelopment. By integrating site cleanup with wider community plans, there can be significant economic benefits, such as the creation of new jobs or an increase in housing values, which can stimulate the revitalization of distressed neighborhoods.

To learn more about handling environmental impacts at opportunity zone sites, download the eBook 11 Tools and Resources for Maximizing Your Investment in An Opportunity Zone.

When it comes to site cleanup, there are many available approaches, each of which must be carefully considered to achieve maximum impact both technologically and economically. Selecting the proper technology to deal with environmental issues can lead to immediate cost savings due to the streamlining of construction schedules or as compared to other applicable remedial technologies or future cost savings from the reduction of overall risk.

The Benefits of Using Nitrile to Mitigate Vapor Intrusion

Nitrile or nitrile-butadiene rubber (NBR) has an abundance of properties that make it an ideal material to be utilized in barrier systems that prevent subsurface contaminants from migrating into the indoor airspace of buildings. It has good abrasion/tear resistance, good compression set, resistance to heat, water, and chemicals. But let’s take a close look at why nitrile has become of key importance to the vapor intrusion mitigation industry.

Gas Permeability and Chemical Resistance – Why Nitrile is So Protective

nitrile
Physicians offices have moved away from latex and to nitrile gloves, because not only is nitrile more chemically resistant; it’s more durable too.

Many synthetic rubber production companies rate Nitrile’s gas permeability as good. Its gas resistance depends on the level of acrylonitrile which is commonly referred as the ACN content. The typical ACN content ranges from 14% to 50% because the more acrylonitrile included in the copolymer, the resistance to oil and gas permeation increases; however, the higher the ACN content, the lower the flexibility of the rubber. Ergo, the common ACN content percentage for the nitrile to have low permeability while still being flexible is 36%. The possible reason for the good gas permeability is that when butadiene and acrylonitrile are combined in the mixing process, the two polymers react to each other a create strong cross-linked valent bonds. These bonds leave little room for most gases to pass through, except for ozone, ketones, esters, and aldehydes.

So it makes sense that nitrile can be of tremendous value to the vapor intrusion world.  The primary goal of practitioners in this industry is to protect human health by blocking contaminant gases from migrating from a subsurface source into the indoor air space of a building.

An acknowledged weakness in many vapor barrier systems is in the slab penetration and perimeter termination locations, where spray-applied core material composed of Styrene-Butadiene (SBR)- modified asphalt is used. While excellent at repelling water, aggressive chemicals such as petroleum solvents and chlorinated volatile organic compounds (VOCs) will permeate into the SBR-modified asphalt at a relatively high rate, particularly in these vapor intrusion sensitive areas of the building construction.

The Research and Development Scientists at REGENESIS and Land Science know this, and that’s why they developed Nitra-Seal.

Nitra-Seal offers a substantial upgrade as it employs a more chemically resistant nitrile latex instead of the more susceptible SBR material. Nitrile, due to some of the reasons explained above, is recognized throughout the environmental engineering industry as being more chemically resistant than rubber or SBR and is often used in personal protective equipment when working on hazardous waste sites (e.g. nitrile gloves). Laboratory testing has shown up to 10X higher chemical resistance when compared to any other spray applied vapor barrier material on the market.

Puncture Resistance

If you’ve been to a doctor’s office lately, you’ll likely see that the gloves sitting there on the counter are no longer latex; they’re nitrile. Physicians offices have moved away from latex and to nitrile gloves. Why? Because not only is nitrile more chemically resistant; it’s more durable too.

So the R&D team at Land Science again applied this concept when they were developing Nitra-Seal. With vapor intrusion regulatory standards becoming ever more complex and stringent, there is an emerging need in the industry for better, more reliable protection against contaminant vapor intrusion.

This is why nitrile is so valuable. It will provide better protection, and that protection will be more durable and reliable due to puncture resistance. Nitra-Seal forms a highly puncture resistant barrier that greatly reduces the chance of damage occurring after installation and prior to the placement of concrete.

The added value brought by nitrile’s durability provides a critical advantage with new building construction.

Nitrile can be applied as sheets or as liquid depending on what it needs to be applied to. For instance, if nitrile rubber is needed to seal plumbing, then liquid is required; but if an entire floor needs to be sealed then nitrile sheets are the best option. There is no need to lose sleep over whether nitrile will leave even a sliver of a crack on the application site because Nitrile can fit into any nooks and crannies of any site where it is spray-applied, including seams and penetrations of a vapor barrier base layers. In the end, once a site is sealed, there is an excellent chance that the seal will last for years without letting gas permeate or being severely damaged.

When the other layers of the Nitra-Seal system are combined with its spray-applied Nitrile-based core to seal all seams and penetrations, the end result is a barrier that is highly resistant to a broad range of chemical pollutant vapors.

Nitrile is a versatile material that is utilized in many different applications, from sealing gas pipes to providing doctors protection in gloves. But it’s also especially valuable to the vapor intrusion mitigation industry, due to its low gas permeability, chemical resistance, and easy application.

webinar

Incorporating CSIA in Vapor Intrusion Investigations

Land Science is pleased to present a webinar with Dora Taggart, President of Microbial Insights, Inc., and Sam Rosolina, PhD, Analytical Chemist and Manager of the Compound Specific Isotope Analysis (CSIA) Laboratory at Microbial Insights. In this webinar, Dora and Sam discuss incorporating CSIA in vapor intrusion investigations. They are joined by Tom Szocinski, CEP, Director of Vapor Intrusion at Land Science, who discusses innovative new vapor barrier technologies that are more protective and more cost-effective.

Learn the following in this free webinar:

  • A primer for sites impacted with contaminant vapor intrusion
  • How CSIA is being used to fingerprint different contaminant sources
  • Using CSIA to help identify the underlying cause of decreased indoor air quality

FAQ: CSIA and Vapor Intrusion

Geophysics FAQThe questions summarized in this FAQ as part of the Land Science “Distinguished Speaker” webinar series, were provided by our guest presenters, Dora Taggart and Sam Rosolina, PhD in response to questions fielded throughout the webinar presentation. REGENESIS and Land Science are grateful to both Ms. Taggart and Dr. Rosolina for sharing their expertise. Land Science is dedicated to providing relevant, industry-leading content in support of client partners globally. Any use or reproduction of the contents of this FAQ document must be approved by Land Science, REGENESIS and/or Microbial Insights.

Want to learn more about CSIA and Vapor Intrusion? Download the Q&A from the webinar here:

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Former textile mill

Vapor Barrier Speeds Redevelopment of Former Textile Mill

A former textile mill operated from 1926 through 1983. Throughout the years in operation, there were no regulatory guidelines in place regarding the use and disposal of hazardous chemicals used on site. As a result, once operations ceased, the site was classified as a brownfield. The building has been vacant since the early 2000’s and the hazardous environmental conditions have made redevelopment a challenge. However, tax credit financing made it possible for developers to purchase the 24,500 square-foot building in 2015. The developers received $9 million in tax credit financing, making this remediation and restoration project possible. The tax credits included the New Markets tax credits and South Carolina Textiles Communities Revitalization Act.

textile mill case study

This case study features the following:

  • Site owners are pleased that the quick installation of Geo-Seal allowed the project to meet construction timeline goals
  • The support of the state of South Carolina through the tax incentive package made it possible for developers to redevelop this brownfield site into new jobs and businesses for the community
  • The construction and renovations included elements of historic preservation

© 2020 All rights reserved. Geo-Seal is a former registered trademark of REGENESIS.  Geo-Seal is now a registered trademark of Epro Services Inc.

Thank you, download the case study here

Background

A former textile mill operated from 1926 through 1983. The former textile mill was built in 1925 and was the first plush fabric mill in the state of South Carolina. This textile mill was a key business in the community, providing higher than average wages for generations of families. Unfortunately, the downturn of the U.S. textile industry in the 1980’s led to the company’s decline, eventually causing the textile mill to go out of business in 1983.

The redevelopment of the former textile mill consisted of remediation, historic preservation, and the creation of a pocket park for the city. This redevelopment will bring new jobs and businesses to the area while preserving the site’s important cultural and historical features.

textile mill vapor mitigation

Vapor Barrier Speeds Redevelopment

© 2020 All rights reserved. Geo-Seal is a former registered trademark of REGENESIS.  Geo-Seal is now a registered trademark of Epro Services Inc.

langan webinar

Update on The Evolving Vapor Intrusion Regulatory Landscape

Land Science is pleased to present a webinar with vapor intrusion expert Sigrida Reinis, PhD, PE, Associate at Langan. During this webinar presentation, Dr. Reinis discusses the increasingly challenging vapor intrusion regulatory landscape, and solutions to address vapor intrusion challenges at sites. Rick Gillespie, REGENESIS and Land Science Senior Vice President, North America also presents innovative new vapor barrier technologies that are more protective and more cost-effective.

Learn the following in this free webinar:

  • Changing trends in the vapor intrusion regulatory landscape at the federal and state levels
  • How to meet the demands of increasingly data-driven regulations
  • Case studies of vapor intrusion sites where extensive data-driven challenges were addressed

View this Free Webinar

Complete the form below to view this free webinar.

Thank you, download the case study here

Background

A former industrial manufacturing facility in Greenville, SC was purchased for redevelopment in 2017. Building improvements were planned to include a warehouse, offices and self-storage units to serve a growing commercial area. Now located within an urban commercial land use area of Greenville, redevelopment plans included converting the industrial warehouse building into climate controlled self-storage units, and renovating the office into an apartment unit and office.

Prior to purchasing the site in 2017, the current site owners entered into a Voluntary Cleanup Contract and Brownfields agreement= with the South Carolina Department of Health and Environmental Control (SCDHEC). The Brownfields agreement allowed the site owners to purchase the site while receiving SCDHEC liability protection for existing environmental contamination by agreeing to perform certain environmental assessment, mitigation, or remediation activities.

Bunnell Lammons

Innovative Use of Vapor Intrusion Coating

Retro-Coat Utilized to Prevent Harmful TCE and Chloroform Vapor Intrusion

A former industrial manufacturing facility in Greenville, SC was purchased for redevelopment in 2017. Building improvements were planned to include a warehouse, offices and self-storage units to serve a growing commercial area. Now located within an urban commercial land use area of Greenville, redevelopment plans included converting the industrial warehouse building into climate controlled self-storage units, and renovating the office into an apartment unit and office.

Prior to purchasing the site in 2017, the current site owners entered into a Voluntary Cleanup Contract and Brownfields agreement with the South Carolina Department of Health and Environmental Control (SCDHEC). The Brownfields agreement allowed the site owners to purchase the site while receiving SCDHEC liability protection for existing environmental contamination by agreeing to perform certain environmental assessment, mitigation, or remediation activities.

Vapor Intrusion Barrier South Carolina

This case study features the following:

  • The Retro-Coat barrier and Vapor-Vent system were incorporated into already planned renovations, saving the site owner time and money.
  • Retro-Coat is resistant to both TCE and chloroform and is a wearing surface, rated for foot and forklift traffic.
  • The Retro-Coat system layers cure quickly, reducing building downtime.
  • The combination of Retro-Coat and Vapor-Vent was chosen as a remedial solution to mitigate the risk of harmful vapor intrusion.

TerraShield Construction Details

TerraShield Construction Details

In an effort to provide the best support possible to environmental consultants, architects, contractors, applicators, and inspectors, Land Science provides a variety of pre-engineered details and information for different vapor intrusion mitigation designs and solutions.

To access and download the DWG file content on this page, you must first fill out our short Registration Form. If you have already registered for an account then go straight to the Login Page.

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Detail Drawing PDF DWG
TerraShield Base Layer Components PDF-icon dwg-icon
TerraShield Base Overlap PDF-icon dwg-icon
TerraShield Existing Repair Sequence PDF-icon dwg-icon
TerraShield Penetration Sequence PDF-icon dwg-icon
TerraShield Repair Sequence PDF-icon dwg-icon
TerraShield Termination Sequence PDF-icon dwg-icon
TerraShield TerraVent Riser PDF-icon dwg-icon
TerraShield Vertical Termination PDF-icon dwg-icon

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Detail Drawing PDF DWG
TerraShield Base Overlap PDF-icon dwg-icon
TerraShield Existing Repair Sequence PDF-icon dwg-icon
TerraShield Penetration Sequence PDF-icon dwg-icon
TerraShield Repair Sequence PDF-icon dwg-icon
TerraShield Termination Sequence PDF-icon dwg-icon
TerraShield TerraVent Riser PDF-icon dwg-icon
TerraShield Vertical Termination PDF-icon dwg-icon

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For more information or to inquire about a unique design, please contact Land Science support at info@landsciencetech.com

MonoShield Construction Details

MonoShield Construction Details

In an effort to provide the best support possible to environmental consultants, architects, contractors, applicators, and inspectors, Land Science provides a variety of pre-engineered details and information for different vapor intrusion mitigation designs and solutions.

To access and download the DWG file content on this page, you must first fill out our short Registration Form. If you have already registered for an account then go straight to the Login Page.

[pp-non-logged-users]

Detail Drawing PDF DWG
MonoShield Base Overlap PDF-icon dwg-icon
MonoShield Existing Repair Sequence PDF-icon dwg-icon
MonoShield Penetration Sequence PDF-icon dwg-icon
MonoShield Repair Sequence PDF-icon dwg-icon
MonoShield Termination Sequence PDF-icon dwg-icon
MonoShield TerraVent Riser PDF-icon dwg-icon
MonoShield Vertical Termination PDF-icon dwg-icon

[/pp-non-logged-users]

[pp-logged-users]

Detail Drawing PDF DWG
MonoShield Base Overlap PDF-icon dwg-icon
MonoShield Existing Repair Sequence PDF-icon dwg-icon
MonoShield Penetration Sequence PDF-icon dwg-icon
MonoShield Repair Sequence PDF-icon dwg-icon
MonoShield Termination Sequence PDF-icon dwg-icon
MonoShield TerraVent Riser PDF-icon dwg-icon
MonoShield Vertical Termination PDF-icon dwg-icon

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For more information or to inquire about a unique design, please contact Land Science support at info@landsciencetech.com