Defer Gain launches Opportunity Fund


Disclosure: Rose Law Group represents Defer Gain


By Dan Gauthier, an attorney at Rose Law Group pc handling many Opportunity Zone investment counseling and Opportunity Fund structuring


The Tax Cuts and Jobs Act of 2017 garnered a great deal of attention in many areas upon its passage, including the treatment of taxable income and real estate. One section, the Investing in Opportunity Act (the “Program”), which established Qualified Opportunity Zones and Qualified Opportunity Funds, drew less attention at that time. Now, potential investors are buzzing about this bipartisan tax incentive Program.

On Friday, February 8, 2019, Defer Gain Fund I, LP (“Defer Gain”) one of Arizona’s and the southwest U.S.’s first Qualified Opportunity Funds, hosted an investor mixer.

In brief, the Program allows investors to defer tax on capital gains invested into a Qualified Opportunity Fund within 180 days of a sale or taxable event. When they hold their investment for seven years, investors receive a step-up in basis on their investment equal to 15%, thereby reducing their deferred tax bill. Finally, the appreciation on investments held for at least ten years is completely tax-free.

Defer Gain focuses on real estate investments in the Phoenix-metro area, in Arizona, and in the southwest U.S. Defer Gain’s principals have over 100 years of combined experience in real estate development, renewable energy, and construction. They are committed to helping Arizona’s economy grow and thrive.

Several of Defer Gain’s current real estate projects are located in downtown Phoenix, where the Fund is confident we will see substantial growth over the next decade. One of Defer Gain’s principals, Michael Lafferty, stated downtown Phoenix has seen six billion dollars invested since 2010 and is projected to get an additional six to seven billion dollars invested over the next five years. Lafferty also noted downtown Phoenix currently houses an estimated 30,000 people. Within five years, Lafferty commented, downtown Phoenix will draw 8,000 more people, filling every available unit in the area – including those to be built by Defer Gain.

Defer Gain is one of the only operating Qualified Opportunity Funds in the region and the only Fund with four ready-to-go projects.

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February 2019