VANCOUVER OPPORTUNITY ZONE PROSPECTUS Explore Our Opportunities
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VANCOUVER OPPORTUNITY ZONE PROSPECTUS Explore Our Opportunities Prepared by CITY OF VANCOUVER, WASHINGTON in collaboration with COLUMBIA RIVER ECONOMIC DEVELOPMENT COUNCIL (CREDC) A project of ACCELERATOR FOR AMERICA March 2019 (revised July 2019) Note: The use of the word “prospectus” for the purpose of the work contained herein is not to advertise about, endorse or in any other way to promote or offer specific investment opportunities in cities OR OTHERWISE. The urban investment prospectus is a template designed to help unify city leaders around a plan, to show what might occur in a city and to use as a tool to promote the city and its plans. The prospectus has been prepared for discussion purposes only and not to induce anyone to enter into any agreement or transaction. For the avoidance of any doubt, the distribution of this prospectus does not constitute an offer to sell or a solicitation of an offer to buy any assets or equity securities or any investment of any kind. VANCOUVER • INVESTMENT PROSPECTUS 2 EXECUTIVE SUMMARY • Vancouver, Washington is a growing, entrepreneurial • Vancouver’s Opportunity Zones were intentionally city of 185,000 people—the second largest city in the chosen to maximize the impact of Opportunity Zone Portland, Oregon metro region of 2.4 million. investment by reinforcing its waterfront, downtown and Lower Grand Employment Area growth hubs and Located along the north bank of the Columbia River • promoting investment in the Fourth Plain corridor approximately an hour east of the Pacific Ocean revitalization area. and just west of the Cascade Mountain Range, Vancouver enjoys gorgeous views of Mt. Hood and • Vancouver has four Opportunity Zones with Mount St. Helens, historic sites, waterfront access, highlighted catalytic investments and adjacent an active downtown, and friendly and walkable investment potential, all of which are linked via The neighborhoods. Vine bus rapid transit (BRT) line. • The diversified economy of Vancouver and Clark • The City of Vancouver has a one-stop department for County, built on health care, manufacturing, food land use and economic development (Community processing and trade, has added 37,000 new jobs and and Economic Development), which is supported by over 1,300 new businesses since 2010. a regional economic development agency (Columbia River Economic Development Council or CREDC). • Building permits issued within the city limits have exceeded $1.3 billion in value over the past five years. John W. Collum Principal Planner, The city has a strong commitment to continuing the • Community and Economic Development investment that’s creating an active mixed-use [email protected] environment along its former industrial waterfront, while also focusing on improvements along the Brittany Bagent Fourth Plain corridor—Vancouver’s International Director of Strategy, CREDC District—that will protect existing businesses while [email protected] creating new ones. VANCOUVER • INVESTMENT PROSPECTUS 3 OPPORTUNITY ZONE TAX INCENTIVES Opportunity Zones offer three tax incentives for investments made in designated low-income communities through a Qualified Opportunity Fund: Temporary Deferral Step-Up In Basis/ Permanent Exclusion Reduction in Taxes Investors can defer tax on A permanent exclusion from any capital gains reinvested A step-up in basis for capital taxable income of capital in a Qualified Opportunity gains reinvested in a QOF is gains from the sale or Fund (QOF) until the earlier possible. The basis is exchange of an investment of the date on which the increased by 10% if the QOF in a QOF if the investment is investment in a QOF is investment is held for at held for at least 10 years. sold/exchanged or least 5 years, and by an Applies only to gains accrued December 31, 2026. additional 5% if held for at after investment in a QOF. least 7 years, thereby excluding up to 15% of the original gain from taxation. Source: IRS, Economic Innovation Group VANCOUVER • INVESTMENT PROSPECTUS 4 OPPORTUNITY ZONE TAX INCENTIVES The Tax Cuts and Jobs Act has established new Internal Revenue Code Section 1400Z —Opportunity Zones. Qualified Tax Deferral Qualified Capital Gains Opportunity Zone or Exemption Opportunity Fund Property/Business 5–10+ years VANCOUVER • INVESTMENT PROSPECTUS 5 OPPORTUNITY ZONE TAX INCENTIVES The Tax Cuts and Jobs Act has established new Internal Revenue Code Section 1400Z —Opportunity Zones. There are four parties in an Different than other tax credits: Opportunities Zone transaction: • More market-oriented • Residential and commercial real estate and business investments Taxpayer • No benefit cap Qualified Zone For more information, please visit: www.irs.gov/newsroom/opportunity- Opportunity zones-frequently-asked-questions Fund Projects (Property & Businesses) VANCOUVER • INVESTMENT PROSPECTUS 6 THE URBAN INVESTMENT PROSPECTUS: CONTENT GROWTH CAPITAL DEMAND INCLUSION Set economic context for city Identify investable projects Focus on human capital, and metropolis, identifying and propositions within each job connections and key drivers/assets Opportunity Zone wealth creation PLACE MAKING INSTITUTIONAL CAPACITY Commentary on the essential Recommendations on must-dos to re-knit spatial institution-building options and social fabric to expedite growth and inclusion VANCOUVER • INVESTMENT PROSPECTUS 7 GEOGRAPHY OF VANCOUVER VANCOUVER • INVESTMENT PROSPECTUS 8 GEOGRAPHY OF VANCOUVER OPPORTUNITY ZONES Population Population Square % Change 2010 2017 Miles Portland- Vancouver 2,170,801 2,382,037 +9.7% 6,683.75 MSA Clark County 414,816 457,474 +10.3% 628.48 Vancouver 160,202 171,393 +7.0% 51.84 Zones 11,205 12,035 +7.4% 5.57 Portland-Vancouver MSA Vancouver City Limits Vancouver Opportunity Zones VANCOUVER • INVESTMENT PROSPECTUS 9 VANCOUVER MOMENTUM BY THE NUMBERS BY THE ASSETS BY THE • With 185,000 population (2018 • Diverse set of large OPPORTUNITY ZONES th nd est.), 4 largest & 2 fastest employers (health care, • Zones were selected to growing city in Washington semiconductor reinforce growth hubs nd State, and 2 largest city in manufacturing, food (Waterfront, Downtown and Portland MSA processing, trade, high tech) Lower Grand Employment • Over $1.3 billion of building • City and partners Area) and Fourth Plain permit value since 2013 commitment to education, corridor revitalization area • Emerging downtown with $1.5 workforce development, • Three zones are contiguous billion Waterfront Vancouver equity and inclusion along the I-5 corridor, taking redevelopment underway, • Headquarters for locally advantage of downtown and bringing new residential, office, grown but nationally known Lower Grand employment restaurant, retail and park uses brands like Nautilus and centers • 93 venture capital deals since Banfield Pet Hospital (a • Zones include planned and 2010 in Clark County totaling Mars Company) underway catalytic projects, $600 million, involving 53 plus large number of companies and 91 investors properties available for development VANCOUVER • INVESTMENT PROSPECTUS 10 VANCOUVER OPPORTUNITY ZONE LEADS • Vancouver is considered the Portland Metro area’s top • CREDC strives to develop a strong and innovative jurisdiction for development and business creation due business environment in Clark County, Washington to assistance from the City and its partners with through collaboration with its over 150 private and expediting permits, compiling data, identifying sites, public investors and strategic partners. CREDC is a and connecting investors. dedicated business concierge connecting individuals • The City of Vancouver works to improve our and companies with resources to accelerate business community’s livability and prosperity through building relocation, growth, and innovation. infrastructure that attracts private investment, working • CREDC and the City have a strong track record of with partners to enhance business recruitment, partnering on projects that bring significant retaining existing businesses, and developing a investments to Vancouver to create new jobs, talented workforce. The city has a strong fiscal base promote innovation, and grow a resilient and with an AA+ bond rating. diversified local economy. • Led by its Community and Economic Development www.credc.org Department, the City supports land development with efficient entitlement and permitting timelines and business development through an array of Business • Vancouver Opportunity Zone points of contact: Assistance Program services. John W. Collum www.cityofvancouver.us/ced Economic Development Principal Planner City of Vancouver www.cityofvancouver.us/opportunity-zones [email protected] Brittany Bagent Director of Strategy, CREDC [email protected] VANCOUVER • INVESTMENT PROSPECTUS 11 VANCOUVER BY THE NUMBERS VANCOUVER • INVESTMENT PROSPECTUS 12 VANCOUVER-CLARK COUNTY DATA PROFILE The Vancouver-Clark County economy has performed well over the past decade JOB GROWTH AVERAGE JOB GROWTH IS UP ANNUAL OUTPACING 2010–2018 EARNINGS PORTLAND METRO, ARE UP WASHINGTON STATE +28.3% 2010–2017 AND U.S. SINCE THE +9.9% RECOVERY EMPLOYEES JOB GROWTH UNEMPLOYMENT UNDER AGE 29 FUELED BY IS DOWN INCREASED NEW JOBS IN 2012–2015 HEALTH CARE, FOOD 2010 2018 SERVICE, LODGING, 12.9% 4.8% +13.6% RETAIL, AND PROFESSIONAL SERVICES VANCOUVER • INVESTMENT PROSPECTUS 13 VANCOUVER BY THE RANKINGS WASHINGTON STATE ROCKS! WE LOVE COFFEE #1 #2 U.S. city with the most coffee Ranked state economy in the nation shops per resident (plus, most Business Insider and WalletHub, 2018 affordable of the