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Posted Feb 28, 2026, 4:01 AM
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Registered User
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Join Date: Dec 2019
Location: Albuquerque, NM
Posts: 1,340
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Albuquerque Business First has a story about Industrial Revenue Bonds and how they work. They highlight various recent and upcoming projects in the area that have benefited from IRBs, including Titan Development's boutique hotel in Nob Hill, which they really focus on in the story.
https://www.bizjournals.com/albuquer...evelopers.html
Quote:
From Project Ranger, Project Solis and Meta's Los Lunas expansion in central New Mexico to Project Jupiter in the southern part of the state, New Mexico's counties and cities have approved and considered numerous large industrial revenue bonds in 2025 to spark economic growth.
Still, despite how critical they are in keeping and bringing industry to the state, many don’t understand what an IRB is or how it works.
Put simply, an IRB is a job creation tool for counties and municipalities, Bernalillo County Executive Development Officer Marcos Gonzales said.
In exchange for job creation, an IRB exempts the recipient from a certain percentage of real property taxes, personal property taxes and gross receipts taxes for a set period of time, Gonzales said.
The maximum time period is 30 years, Gonzales said. He explained what each exemption refers to as follows.
Tax exemption explanation
• Real property tax exemptions: refer to an ad valorem property tax exemption on the land and building improvements.
• Personal property tax exemptions: refer to an ad valorem property tax exemption on personal property such as equipment.
• Gross receipts and compensating tax exemptions: refer to sales or use taxes assessed on the purchase of personal property such as equipment.
The county or city issuing an industrial revenue bond works and negotiates with the recipient to determine the amounts it should exempt from each tax category in exchange for how many jobs will be created, how much economic impact the project will bring and how much future tax revenue — once the IRB expires — the project will generate.
“Our return on investment on that (tax exemption) is all of the new jobs happening, spurring additional job spending and other spending in the economy that wouldn’t otherwise be happening,” Gonzales said.
The amount of the industrial revenue bond, such as the $776 million IRB issued to Pacific Fusion, does not represent the amount of taxes the company will be exempted from, and it’s not an amount of money the county is loaning to the company.
Instead, the amount of the IRB represents the private investment the company plans to make into the project.
“People get caught in the numbers because you’ll have a $220 (million) or $750 (million IRB),” Gonzales said. “Everybody is like, ‘Holy smokes, the county is bonding that much for that company.’ No. The dollar (amount) you see in the IRB represents the private investment.”
The amount of private investment, or IRB, is aided by the tax exemption because it allows the company to put the money it saved from the exemption back into the project, Gonzales said.
While the property tax savings are significant over time, the most significant upfront savings for the company generally come through gross receipts and compensating tax exemptions, given that New Mexico’s real property tax rate isn’t that high compared to other states, Gonzales said.
“This really helps the balance sheet by not having that tax line item there,” Gonzales said. “They have a greater ability to actually do the project and provide jobs ... or retain jobs.”
Titan Development Partner Josh Rogers echoed Gonzales’ sentiments and said that receiving the IRB for its Hiway House Motel project was “absolutely essential to having it go forward.”
Titan Development's Hiway House Motel project is a redevelopment of the previously demolished Historic Route 66 Hiway House Motel into a 112-room Tribute hotel — a Marriott brand of independent, boutique hotels known for their unique character, captivating design and vibrant social scenes.
The hotel, which will be called The Rev, will be located at 3200 Central Ave. SE and feature a fitness area, a signature restaurant, a rooftop bar with views of the city, meeting rooms and small retail space featuring goods crafted by New Mexican makers and artists.
It’s anticipated to create an estimated 77 new jobs.
Perhaps more importantly, though, it will bring an estimated 31,000 guests annually to Nob Hill.
Those guests will spend money at Nob Hill’s restaurants, bars, stores and venues, bringing money to the local economy and businesses that otherwise wouldn’t be spent here.
“We’ve got Hotel Zazz, which has done a really good job of showing there is demand for hospitality in Nob Hill, but ... there’s excess demand beyond ... (that),” Rogers said. “Our hotel specifically is for that reason. It’s not intended for the business traveler; it’s intended for the vacationer that’s coming to enjoy Albuquerque. With that project, the goal would be to revitalize Nob Hill.”
Rogers pointed to the impact the Sawmill Market, Hotel Chaco and Hotel Albuquerque have had on the Old Town area as an example of how he and Titan Development hope their Hiway House Motel project will impact Nob Hill.
The project will also boost the city and county’s lodger's tax revenue, which can then be used to further promote and stimulate tourism, according to Rogers and a New Mexico Economic Development Department document.
Geltmore LLC Vice President Adam Silverman agreed with Rogers and also pointed to the eventual increase in gross receipts tax revenue the city and county will eventually see from projects like this.
“Yes, the (municipality) is giving away some property tax income, but what if the property was never redeveloped," Silverman posed. "In return for the IRB, cities get something more valuable to grow the community — increased gross receipts, … (and) they also get jobs, gross receipts tax revenue from the businesses in the facilities, gross receipts tax from the people working in these facilities in areas that no one may have worked in before (and) businesses willing to spend more in the community — via labor and materials — because they have an offset of some of the property taxes, which have been abated.”
He added that municipalities can then allocate some of those gross receipts tax funds where they choose, offering examples such as increased spending on community benefit projects like placemaking, parks, community centers, social programs and, in home-rule cities, storefront grants for businesses impacted by crime.
In exchange for the job creation, increased tax revenue and the tourism money this project is expected to generate, Bernalillo County issued a $34 million industrial revenue bond to Titan Development.
This is the only project Titan Development has used an IRB on in the last decade, and it couldn’t have done the project without the incentive, Rogers said.
The IRB was necessary due to the challenges of the site, Rogers said. Some of those challenges are that the existing structure — formerly the Hiway House Motel — had to be demolished and due to the small site size, Titan Development will need to build an underground parking deck to create sufficient parking.
For Titan Development, the real property tax abatement component of the IRB the county issued for its Hiway House Motel project was a critical component of its ability to do the project, although the gross receipts and personal property tax abatements were also helpful, Rogers said.
Titan Development will have about 49% of its real property taxes for the project abated over 25 years, which helps the development firm achieve a positive cash flow on the project, Rogers said.
“I think for other IRBs that have a lot of manufacturing equipment or things like that, I think that’s where the gross receipts tax and personal property tax exemptions can be more beneficial,” Rogers said. “But in our case, it really is the property tax exemption.”
IRB recipients benefit differently from the IRBs they receive. Those with a lot of manufacturing equipment often benefit more from the gross receipts tax and personal property tax abatements, as Rogers highlighted, while Titan is benefiting significantly from the real property tax abatement on its Hiway House Motel project.
Ultimately, though, they benefit the city or county by helping attract or retain jobs and economic activity to the area and the recipients by making their project more feasible.
"Municipalities, whether it's city, county or state, have pretty limited resources available to them to incentivize developments," Rogers said. "So, these (IRBs) are good tools for developments, and they're helpful in getting projects over the hump."
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