After purchasing our own historic building at 287 Auburn Street, Newton, Massachusetts in late September of 2017, we were anxious to begin rehabilitation of the building and move into our new home.
In December, 2017, the Tax Cuts and Jobs Act of 2017, established Opportunity Zones by way of a provision of the Internal Revenue Code i.e Section 140OZ-2 (the "OZ Rules"). Pursuant to the OZ Rules, Treasury directed the individual states to designate certain census tracts as Opportunity Zones.
Historical buildings lend themselves very well to multifamily residential use.
When performing an adaptive reuse of a historic building, in addition to the possibility of utilizing historic tax credits (HTC's), if a certain number of the residential units are designated as affordable there may be a possibility to secure low-income housing tax credits (LIHTC's). In such a project, there will need to be a twinning of the two different types of tax credits, and successful completion of the project will hinge on the attention needed to be paid to the structuring of the transaction, the coordination between the requirements of each program, as well as the specific protections needed by the tax equity provider(s) and/or the lender(s).