The One Big Beautiful Bill Act (signed July 4, 2025) just made the Opportunity Zone (OZ) program PERMANENT, delivering powerful tax benefits for investors in income-producing properties. Here's why this is a game-changer for your CRE portfolio.
What's New with Opportunity Zones?
- Permanent Program: No sunset date—invest with long-term certainty.
- Enhanced Tax Benefits: Defer capital gains taxes on OZ investments until 2031 or beyond, with full exclusion of gains after a 10-year hold.
- Pairs with 1031 Exchanges: Combine OZ deferrals with uncapped like-kind exchanges for unmatched tax efficiency.
How OZ Benefits Income-Producing Property Investors
Maximize Cash Flow
Reinvest gains from property sales into OZ projects like multifamily, retail, or industrial to defer taxes, keeping more capital in play for your next acquisition.
Boost Long-Term Returns
After 10 years, OZ property gains can be tax-free, supercharging ROI from rental or lease income. This is a powerful wealth-building tool for buy-and-hold investors.
Targeted Growth Opportunities
OZs target underserved areas, ideal for workforce housing or mixed-use projects with stable cash flow. Recent OZ multifamily deals have yielded $5M+ in Year 1 tax savings when paired with cost segregation studies.
Scale Your Portfolio Tax-Efficiently
Use deferred gains to acquire larger income-producing assets, leveraging OZs and 1031 exchanges to build wealth while minimizing your tax burden.
Why Act Now?
- Market Momentum: Post-law clarity fueled a $115B CRE transaction surge in Q2 2025, with multifamily leading the charge.
- Bonus Depreciation Synergy: Pair OZs with permanent 100% bonus depreciation for massive upfront deductions on property improvements.
- Certainty for Planning: The permanent status allows you to structure long-term strategies without worrying about program expiration.
Frequently Asked Questions
What properties qualify for OZ benefits?
Income-producing properties like multifamily, retail, or industrial in designated OZ areas qualify. The property must substantially improve (invest equal to the purchase price in improvements within 30 months).
How do I locate OZ areas?
Use the IRS Opportunity Zone maps available online, or consult a CRE broker like Eric Hughes who knows the designated zones in your target markets.
Can OZ benefits pair with other strategies?
Yes! Combining OZ investments with 1031 exchanges and bonus depreciation creates a powerful triple-threat strategy that maximizes tax savings and wealth building.
Ready to Scale Your Portfolio?
Looking for the perfect investment property to leverage these OZ benefits?
Eric Hughes, Broker
32 Years of Commercial Real Estate Experience
(281) 236-9553
Eric@centermarkrealestate.com
Centermark Commercial Real Estate
Note: Always consult a tax professional for your specific situation.