IGX and 18 Squared Partner to Build Industrial Warehouses in Opportunity Zones

Qualifying Businesses Will Produce Significant Tax and Manufacturing Benefits

SAN ANTONIO, Texas--()--Industrial Group Southwest, LLC (“IGX”) and 18 Squared GP, LLC (“18 Squared”) announced today that they have partnered together on two industrial warehouse development projects, Ball Street 3 and South Park 2. Located in prime Opportunity Zones in San Antonio, Texas, these developments will allow investors to reap favorable tax benefits from the government, while also supporting the supply chains that are the backbone of American manufacturing and commerce.

IGX and 18 Squared formed the partnership to create diversified exposure to commercial real estate projects and tax-advantaged benefits for investors, equity partners, and qualifying businesses, while accelerating investment of the surrounding community in these Opportunity Zones.

“IGX is excited to partner with 18 Squared to help more qualifying businesses tap into this remarkable incentive,” said Ron Mills, Principal and Managing Director of IGX. “Fulfillment is one of the most critical pieces of ecommerce logistics and given the fact intermodal volumes are approaching pre-pandemic levels, Ball Street 3 and South Park 2 are uniquely positioned to be key players in the supply chain. We expect strong demand for prime locations after this pandemic-induced cycle.”

As the economy attempts to rebound from the global pandemic, while bracing for a potential second wave of COVID-19, this partnership comes at an important time. Consumers have dramatically increased online shopping, which has driven companies to stock increased inventory and diversify their supply chains to mitigate risks on imports from China and other hard-hit manufacturing cities. This diversification includes everything from moving operations to sites in Mexico to building distribution centers locally, closer to point-of-sales.

“Investors in a post-pandemic world are seeking to defer, reduce, or eliminate capital gains,” stated Mark Germain, General Partner of 18 Squared. “Our strategic locations in San Antonio, Texas will allow businesses to do this through Qualified Opportunity Funds. Significant tax benefits help ensure current equity partners receive favorable risk-adjusted returns through these investments.”

Ball Street 3 and South Park 2 are strategically located close to I-35, a major access point for manufacturing in Texas. South Park 2 is located in the South Submarket, close to the Port of San Antonio. And Ball Street 3 is situated directly on Loop 410 and IH-35, offering easy access to the IH-35 Corridor, which is the main thoroughfare in local and regional customers’ supply chains.

Both IGX and 18 Squared bring their own expertise to the projects. IGX is a local, fully integrated operating company with 40 years of experience and 20 million square feet of industrial space developed and/or acquired. 18 Squared has deep knowledge in real estate financing and the Opportunity Zone tax incentive.

Opportunity Zones are a federal economic and community development tax benefit, added to the tax code by the Tax Cuts and Jobs Act on December 22, 2017. As enacted by 26 USC 1400Z-1, a “Qualified Opportunity Zone” is a low-income census tract that is designated as a Qualified Opportunity Zone. Equity investments in Opportunity Zones can drive attractive tax-free returns for investors provided certain conditions are met.

South Park 2 and Ball Street 3 are available for lease now, beginning September 2020. For more information on these properties, check out www.igsouthwest.com

About 18 SQUARED GP, LLC

18 SQUARED GP, LLC is a privately-owned real estate private equity firm focused on non-correlated, income producing real estate investment opportunities. 18 Squared has a specialized portfolio of properties which include workforce housing, value-add multifamily rental units, commercial industrial properties, and Opportunity Zone projects throughout the U.S. For more information about 18 SQUARED GP, LLC, please visit www.18squared.com.

About INDUSTRIAL GROUP SOUTHWEST (IGX)

IGX is a fully-integrated real estate operating company specializing in the acquisition and development of business parks and buildings for business space, industrial, distribution and manufacturing users. Based in San Antonio, IGX operates in the Southwestern United States (with a focus on Texas) and Northeastern Mexico. The Company’s United States operations focus on a region encompassing Austin, San Antonio, Laredo, Corpus Christi and the Rio Grande Valley. IGX and its partners also have decades of experience in the Northeastern Mexico markets of Monterrey, Saltillo and El Paso/Juarez. For more information about Industrial Group Southwest LLC, please visit www.igsouthwest.com

Additional sources:

http://www.statsamerica.org/opportunity/#:~:text=Overview,investments%20in%20low%2Dincome%20communities.

Contacts

IGX
Ron Mills
Ron.Mills@igsouthwest.com

18 Squared
Y. Dogan Sahin, CFA
dogan@18squared.com

Release Summary

IGX and 18 Squared Partner to build industrial warehouses in Opportunity Zones. Qualifying businesses will produce significant tax benefits.

Social Media Profiles

Contacts

IGX
Ron Mills
Ron.Mills@igsouthwest.com

18 Squared
Y. Dogan Sahin, CFA
dogan@18squared.com