Puerto Rico Opportunity Zone Fund invests in Fusion Farms
Monllor Capital Partners LLC announced that the Puerto Rico Opportunity Zone Fund, LP private equity fund has made an undisclosed investment in Mayagüez-based Fusion Farms, a vertical indoor aquaponic farm developer and operator.
The Puerto Rico Opportunity Zone Fund (PROZ) is reportedly the first private equity firm fund focused on Environmental, Social, and Governance (ESG) investing in Opportunity Zones throughout Puerto Rico.
In the aftermath of Hurricane María, which destroyed 80% of Puerto Rico’s farms, many farmers are currently forced to leave the island for work, while more than 90% of the island’s food is imported.
“Food access in Puerto Rico has become increasingly limited, expensive, and precariously reliant on mainland economies. Moreover, the COVID-19 pandemic, has exposed a broken food supply chain and highlighted the need for hyper-local food production,” fund executives said.
The demand for high quality, fresh and highly nutritious produce has increased significantly, which has led Fusion Farms to expand its operation in Mayagüez and to evaluate locations in other industrial parks throughout the island.
Fusion Farms is building and managing modern, sustainable, and hurricane-protected indoor agricultural solutions for Puerto Rico, creating production ecosystems of CEAq-grown, non-GMO, leafy greens that are fueled by chemical-free and hormone-free fish, using collected rainwater and renewable energy sources, as News is my Business reported.
Monllor Capital Partners LLC Managing Partner José A. Torres “see a perfect fit between PROZ’s mission and Fusions Farms’ business model that bring sustainability, food security and resiliency to the people of Puerto Rico.”
“Anabelle Morales-Droz and the team at Fusion Farms can grow nine-to-12 times the annual yield of traditional farming with only 10% of the water usage, paving the way for a more sustainable agriculture model in Puerto Rico,” said Torres.
“In addition, the hurricane-protected indoor facilities provide food security and resiliency for the people of Puerto Rico,” said Torres, whose fund seeks to make ESG investments in qualified opportunity zone businesses throughout Puerto Rico.
Meanwhile, Morales-Droz, president and Chief Science Officer at Fusion Farms, said the operation is “paving the way for repeatable, scalable food production while pushing forward extensive scientific research on closed-loop aquaponic ecosystems.”
“This kind of agricultural innovation is becoming increasingly critical for sustaining the food supply of large populations of at-risk communities in the face of uncertain economies and climatic challenges,” said Morales-Droz.
Since the passing of the Tax Cuts and Jobs Act in 2017, investors can invest capital gains in a Qualified Opportunity Zone (QOZ) and receive significant tax incentives.
The tax incentives include the deferral of the capital gain tax through 2026 tax year and more importantly, no capital gain tax on profits made after a minimum 10-year hold period.
In the case of Puerto Rico, where nearly the whole island is a QOZ, investors can achieve these attractive tax benefits while helping the recovery and resilience of the Puerto Rican people and economy.
