Gateway Opportunity Zone Fund II

Overview

Gateway Opportunity Zone Fund II acquires and develops sites inside designated Opportunity Zones across six growth markets. Investors reinvest a realized capital gain within 180 days to defer the tax, and a ten-year hold makes the fund's own appreciation federally tax-free on exit.

This is development capital. Expect limited income during construction and lease-up, with returns concentrated at the back-end sale. The 2025 law made the program permanent and reset the deferral rules for investments from 2027 forward.

Gallery

Highlights

Accepts capital gains from any source, not just real estate.
Ground-up multifamily and mixed-use across six markets.
Ten-year hold targets tax-free appreciation on exit.
Target IRR of 13–15%, back-loaded to disposition.

Illustrative Value Growth (per $100k)

Illustrative fund value showing the development J-curve; income is minimal until stabilization, with value concentrated at the ten-year exit. Not a forecast.

Benchmark Analysis

Metric	This Offering	Peer Average
Target IRR	13–15%	12%
Projected equity multiple	2.4x	2.1x
Hold to full benefit	10 yrs	10 yrs

Compared to the average multi-market OZ development fund. Illustrative, net of fees.

Features

Accepts any capital gainYes

1031 exchange proceedsNot eligible

IRA / qualified fundsCase-by-case

DistributionsMinimal during build

Tax-free exitAfter 10 yrs

Reinvestment window180 days

Offering Details

Offering type	Qualified Opportunity Fund
Strategy	Ground-Up Development · 6 Markets
Sponsor	Baker Real Estate Partners
Target IRR	13–15% (net, at exit)
Minimum investment	$50,000
Reinvestment window	180 days from the gain
Hold for full benefit	10 years
Offering exemption	Reg D 506(c) · accredited only

Program Rules: OZ 1.0 vs OZ 2.0

Deferral of rolled-in gain	Until the 2026 recognition date
Interim basis step-up	10% at 5 yrs / 5% at 7 yrs (expired)
10-year appreciation	Tax-free
Rural incentive	None
Program status	Original TCJA (2017), time-limited
Deferral of rolled-in gain	Rolling 5-year window
Interim basis step-up	10% standard / 30% rural
10-year appreciation	Tax-free
Rural incentive	Enhanced; 50% improvement threshold
Program status	Permanent (2025 law)

Illustrative summary of the two rule sets; confirm current law with your CPA.

Documents

Analyst Notes

A credible OZ development fund for patient, gain-deferring capital. Best suited to investors who can leave the money alone for the full decade.

Pros. Broad gain eligibility, experienced development team, geographic diversification, and the signature ten-year tax-free exit.

Cons. Construction and lease-up risk, little current income, a long lock-up, and outcomes sensitive to rates and local absorption.