By Gerelyn Terzo, Global AgInvesting Media
Clearwater, Florida-based Water On Demand, Inc. (WODI), a company specializing in decentralized industrial water solutions, is looking to disrupt the U.S. water industry. Water on Demand has engaged Eazy OZ, an experienced platform within the U.S. Opportunity Zone (OZ) ecosystem, to partner on the launch of a novel investment vehicle called the innovative Water On Demand Infrastructure Fund. The fund is thought to be the first of its kind among water infrastructure projects, seeking to harness key Opportunity Zone tax advantages. WODI is looking to attract $100 million in capital to its new OZ Fund.
Through the fund, Water on Demand is giving investors the opportunity to earn income by investing in capital assets that deliver water treatment solutions on demand via the private sector to agricultural users, among others. In exchange, businesses can treat water themselves, thereby reusing and recycling it to get greater bang for their buck.
Water on Demand CEO Riggs Eckelberry explained, “U.S. water infrastructure is broken. The total funding gap for US water infrastructure by 2033 has now reached a trillion dollars — and government cannot possibly handle it all. We urgently need help from the private sector.”
David Sillaman Jr., CEO of Eazy Do It, the operating entity behind the Eazy OZ platform, highlighted the evolving landscape of OZ investments, stating, ““Opportunity Zone investors are diversifying by investing into impactful assets such as water infrastructure. Now in partnership with Water On Demand, we can help dramatically improve America’s clean water with major funding.”
This strategic pivot towards project funding via an Opportunity Zone Fund represents a significant evolution for Water On Demand. The company had previously concentrated on the development and acquisition of water treatment enterprises. While acknowledging the numerous players in this space, Eckelberry noted the persistent scarcity of capital available to support their water-related needs.
“Our new project funding-focused strategy means that we will help water companies get their projects funded, instead of competing with them,” added Eckelberry. “We believe that by providing the needed capital, we will have a major impact on the many players now in the market.”
Water On Demand is in discussions with prospective investors for the Water on Demand OZ Fund Sponsor, which is currently being formed.
Established under the 2017 Tax Cuts and Jobs Act, Opportunity Zones were designed as a catalyst for economic revitalization and job creation within designated economically distressed communities. The program achieves this by offering compelling tax benefits to incentivize long-term private investments. Since their designation in 2018, thousands of Opportunity Zones have been identified across the U.S. and its territories across a diverse range of urban, rural and tribal areas.
The OZ program provides significant tax advantages for investors who reinvest capital gains into these designated zones, either directly or through Qualified Opportunity Funds (QOFs). The initiative continues to attract substantial capital, with reported private investment reaching $80 billion as of this month.
Notably, there is a growing trend among investors to prioritize projects that generate both financial returns and positive environmental and social impact. This includes investments in areas such as renewable energy, sustainable infrastructure and community-focused developments. By facilitating direct investments into operating businesses, including critical sectors like water infrastructure, the OZ program has the potential to shift the narrative around a disproportionate focus on real estate.
Looking ahead, the Opportunity Zones landscape may see further evolution through the Opportunity Zones Transparency, Extension, and Improvement Act (OZTEIA), introduced with bipartisan support in 2023. While the bill’s passage remains pending, it is a significant topic of discussion in the context of upcoming 2025 tax legislation.
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