Joseph Brendel of Clark Hill PLC has an interesting article, which has some excellent news for real estate investors interested in Pennsylvania Opportunity Zones, on jdsupra.com, Pennsylvania DEP Confirms that Qualified Opportunity Zones in Pennsylvania May Also Offer Environmental Incentives for Redevelopment.
Mr. Brendel writes,
While the real estate development community has focused primarily on the tax incentives available for investment in QOZs, there also may be significant opportunities for limiting environmental risks associated with redevelopment of QOZs.
The designated opportunity zones often are located in financially distressed areas that typically have legacy environmental issues from shuttered manufacturing facilities, refineries, etc.
Therefore, investment in those QOZ areas also requires thorough environmental due diligence and addressing site contamination through state voluntary cleanup programs to protect the investors from exposure to potentially significant environmental liabilities.
The above offers some excellent insights into the potential Opportunity Zones offer for those looking to invest in industrial or commercial buildings in Pennsylvania. Mr. Brendel then goes on to show how a favorable decision by the DECP may make Opportunity Zones even more attractive for industrial real estate investors.
The DEP recently confirmed that properties located within these designated QOZs also qualify as “enterprise zones” for purposes of the applicability of the Special Industrial Area approach under Section 305 of Act 2.
Lastly, he finishes with some excellent insights into why industrial investors in Pennsylvania should benefit from investing in Opportunity Zones.
The benefits associated with remediating Special Industrial Area property in Pennsylvania demonstrate that there can be significant advantages beyond the tax incentives available under the Tax Cuts and Jobs Act for redeveloping environmentally-impacted QOZs that were formerly used for industrial purposes.