NEW MARKETS TAX CREDITS
MARSHALL S TEVENS
New Markets Tax Credits can provide substantial financial benefits to acquirers and/or developers of commercial businesses and real estate projects. In most instances, NMTCs will result in a credit equal to 18% to 22% of the net equity of your project. Even if you have no current need for tax credits, these credits can still be of substantial value as they can be sold to third parties. The professionals at MS Capital (a Marshall & Stevens company) can help you secure these benefits for your project. In order to qualify, your project must be located in a low-income community (a “LIC”). However, many of our clients have been pleasantly surprised at the areas which qualify as LICs. By way of example, areas of Manhattan qualify as LICs. We can quickly, and without any cost to you, ascertain whether or not your project satisfies this requirement.
QUALIFIED PROJECTS MUST DEMONSTRATE A “COMMUNITY IMPACT” THROUGH: • Employment of residents of the LICs (temporary and permanent jobs including those during the construction phase), • Ownership by residents of LICs, and • Providing services to residents of LICs (e.g. hospitals and charter schools)
We can also quickly, and without any cost to you, ascertain on a preliminary basis whether or not we believe that your project can satisfy this requirement. We have found that a wide range of developments can qualify for these credits. MS Capital’s ability to place these allocations through Community Development Entities (CDEs) and monetize the tax credits through existing relationships is the reason our experienced professionals have been engaged on numerous NMTC assignments. In recent periods, our team has structured more than $100 million in tax benefitted transactions.
SPECIFIC SERVICES INCLUDE: • NMTC allocation placement • Transaction structuring • Financial modeling • Capital Raising for equity/debt capital in addition to NMTC tax equity
LOS ANGELES
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NEW YORK
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PHILADELPHIA
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CHICAGO
www.marshall-stevens.com
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ST. LOUIS
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TAMPA
BRIEF NMTC OVERVIEW: The NMTC Program is a community development lending tool designed to stimulate the flow of investment in underserved communities by creating new jobs and accelerating economic revitalization. The program encourages private capital investment in low income communities by providing a federal tax credit to investors. The program is based on the idea that there are viable business opportunities in low-income communities and that a federal tax credit would provide attractive incentive to increase the flow of investment capital to such areas. Qualified project costs are broadly defined and include: land, certain soft costs (e.g., architectural and engineering fees), furniture, fixtures and equipment and moveable property that stays onsite (e.g., a truck that doesn’t leave the site of a manufacturing facility). Generally, it is best to secure this funding prior to a project breaking ground although NMTCs can be secured early during the construction period.
MS CAPITAL: Marshall & Stevens’ investment banking group, MS Capital, specializes in New Markets Tax Credits transactions. In the same space, MS Capital also works on tax equity assignments for energy/renewable energy projects, the Historic Tax Credits program and the Low Income Housing Tax Credit program.
CONTACTS: Barry Hacker Senior Managing Director Cell: 310.499.3910 Tel: 213.233.1503 bhacker@marshall-stevens.com Matthew J. Trumbo Associate Cell: 818.370.5614 Tel: 213.233.1513 mtrumbo@marshall-stevens.com For more information about our team, please visit www.marshall-stevens.com
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