Opportunity Zones, a federal effort begun by President Obama and continued under President Trump, are billed as creating a new marketplace worth as much as $6 trillion via the 2017 Tax Cuts and Jobs Act. That legislation offers long-term equity investors sizable tax incentives for reinvesting capital gains in businesses and real estate located in low-income communities. The theory behind the act is that such reinvestment creates a more solid economic foundation for these communities.
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While companies across many sectors of the economy have participated in the zones, Areu Bros. says it is the first in the entertainment industry. The company has a stated mandate to “support and nurture minority and women storytellers as well as innovators and creators by driving inclusion, culture and diversity,” in the words of a press release Tuesday.
The new initiative anticipates a footprint in Opportunity Zones in Atlanta, Puerto Rico, Miami, and LA and will focus on three verticals: entertainment, ventures and real estate. Areu Bros was formed in early 2018 by founder and CEO Ozzie Areu, Perry’s former head of production.
The entertainment vertical will consist mostly of motion pictures, television, short-form content, music, as well as ancillary efforts in gaming, stage plays, publishing and merchandise. Ventures will focus on tech companies. The Real Estate vertical will invest in properties that allow the company to support creative communities by providing shared physical infrastructure for creators and collaborators.
Steve Glickman, a former senior economic advisor to President Obama and one of the architects of the Qualified Opportunity Zone program, has joined the Areu team, the company said. Andrés W. López, another Obama Advisor, has also joined Areu as a senior advisor alongside Areu Bros president Kim Leadford and Gloria Estefan, who recently became a partner and executive with the company. Areu Bros. is also repped by accounting firm CohnReznick and law firm Sidley Austin.
Along with the announcement of the Opportunity Zone, Areu Bros said it plans to expand its operations and further develop its remaining 30 acres at its Atlanta-based studio lot. The lot, which currently consists of five sound stages, an 11-home suburban backlot and four administration buildings, is located in a Federal Opportunity Zone in Fulton County. Slated to be added to the parcel are new recording studios, sound stages and a technology center.
“Opportunity Zones stimulate communities through infusing new capital to create jobs and economic growth in underserved areas, much like our home in Fulton County’s Greenbriar neighborhood,” said Ozzie Areu, Founder & CEO of Areu Bros. “I’ve spent over a decade working for Tyler Perry witnessing the studio create jobs and opportunity in Greenbriar and now it is my honor to have the ability to deploy resources to an amazing, vibrant community that has supported me and my family for years.”