A fund has invested $1 million in an outdoor industry holding company expected to construct a new facility in Montrose.
The Colorado Outdoors Pearl Fund announced the qualified opportunity zone (OZ) investment in Wedge Brands.
Wedge Brands plans to invest an estimated $14 million into a 76,000-square-foot distribution and third-party logistics center on the Colorado Outdoor campus in Montrose.
The 164-acre campus is designed to attract outdoor industry firms to Montrose and also includes industrial, residential and retail development.
Construction on the distribution and logistics center is expected to begin this year with completion in 2021. Wedge Brands plans to bring additional jobs to Montrose over the next decade.
Wedge Brands recently added Xcel Wetsuits to a portfolio of companies that also includes Briko USA, Elevenate, KAR Direct, Koda Nutrition USA, Level Gloves USA and Northwave USA.
The Colorado Outdoors Pearl Fund was set up to take advantage of opportunity zone tax incentives to invest in the outdoor recreation industry, an effort that includes bringing outdoor industry jobs to Montrose.
A federal tax reform measure enacted in 2017 offers incentives for investing in opportunity zones, areas deemed distressed because of unemployment and income levels. More than 8,700 opportunity zones were established nationwide, with 130 in Colorado. The incentives include the deferral, reduction and even elimination of taxes on capital gains realized on the sale of businesses, real estate and stock.
“We are excited about the new brands coming into the Montrose, Colorado opportunity zone and are committed to delivering on the promise of OZ to drive attractive tax-free returns for investors, real job recreation and a made in America pride for rural Colorado,” said D. Dragoo, general partner of the Colorado Outdoors Pearl Fund.
“Opportunity zones will be the vehicle to bring back economic recovery,” Dragoo added.
Jarka Duba, an Aspen executive who leads Wedge Brands, said he was encouraged to work with the Colorado Outdoors Pearl Fund. “The Pearl Fund should be a great partner for Wedge Brands as we continue to grow and acquire brands.”
Brian Phillips, co-founder and partner of the Pearl Fund, said opportunity zone venture investments offer advantages. “Unlike OZ real estate investing, OZ venture capital can go right to work into companies that are thriving during these times. No permits or construction delays are happening with OZ venture investing.”