Alamogordo NM
11-10-2026 5:20am

Three Otero County Tracts Nominated for Opportunity Zone Status

ALAMOGORDO, N.M. — All three census tracts Otero County put forward for federal Opportunity Zone status have been nominated by the state, county officials announced Monday.

The tracts cover Alamogordo's U.S. 54 Bypass corridor, the city's downtown and the Village of Tularosa. The New Mexico Economic Development Department released the governor's nominations on Nov. 2. The list now goes to the U.S. Treasury Department for designation covering 2027 through 2036.

If Treasury signs off, investors who put capital gains into housing, mixed-use and commercial projects in the three areas could qualify for federal tax breaks. A fourth Otero County tract, inside the Mescalero Apache Reservation, was also nominated.

Housing already underway

The largest of the three, Census Tract 5.02, follows the Charlie T. Lee Memorial Relief Route and U.S. Highways 54, 70 and 82 along Alamogordo's western and northern edge. It already holds two major housing projects.

Sendero Alamo, an 88-unit apartment complex at 1200 Acacia Ave., is under construction. The county describes it as Alamogordo's first new multifamily project in 25 years. Envision Development & Construction has proposed Sacramento Springs, a 248-unit, three-phase community at 1450 Hamilton Road, backed by about $45 million in conventional financing.

The city is also weighing a Bypass Metropolitan Redevelopment Area covering 205 parcels in the corridor. The plan is due for a second hearing before the City Commission, and officials expect a final vote by year's end.

The other two tracts already have redevelopment plans in place:

Downtown Alamogordo (Tract 1) falls under the city's 2019 Downtown MRA. Work there includes the New York Avenue streetscape, rehabilitation of Dudley School and a Sacramento Mountains Foundation effort, with the Lakota Group, targeting 416 abandoned, vacant or deteriorated properties.

Tularosa (Tract 7.02) has had its own downtown MRA plan since 2015. Projects identified there include reactivating the Red Brick Building, the Granado Street historic district and new infill housing. Tularosa Gate Road in the tract is a main route into White Sands Missile Range.

    How the tax break works

    Opportunity Zones were created by the 2017 Tax Cuts and Jobs Act and renewed by the One Big Beautiful Bill Act of 2025. Investors can roll capital gains into projects in a designated zone. The tax on the original gain is deferred and reduced, and gains on the new investment are tax-free if it is held 10 years.

    The county says its tracts qualify under the law's enhanced rural provisions. Those include a 30% basis step-up after five years and a lower, 50% threshold for the "substantial improvement" required of existing buildings. The county says the designation costs it and its municipalities nothing, since the benefit comes from federal tax savings. In a Facebook post Tuesday headed "Three for three," the county said it and its partners "put in nothing but the work," with the capital coming from outside investors.

    New Mexico nominated 65 tracts statewide. The county's submission went through the Southeastern New Mexico Economic Development District, which also serves Lincoln, Chaves, Eddy and Lea counties.

    Mescalero tract

    The state's list also includes Census Tract 9400, which lies within the Mescalero Apache Reservation. The county congratulated the tribe and said use of any designation is up to the tribe, adding that it is ready to coordinate if asked.

    Officials react

    "This is a decade of federal cost-of-capital leverage for Otero County," said Vickie Marquardt, chair of the Board of County Commissioners. She said residents, employers and families at Holloman Air Force Base stand to benefit.

    County Manager Pamela Heltner said staff have a parcel inventory ready and are coordinating with Alamogordo and Tularosa to help developers through permitting and infrastructure planning.

    County Attorney R.B. Nichols noted the county submitted three tracts in May and all three were nominated. "That does not happen by accident," he said, crediting the redevelopment plans paired with each tract. Nichols said the focus now shifts to attracting Qualified Opportunity Fund investors.

    Adam Hoppes, executive director of the Alamogordo Chamber of Commerce, said the nominations give local businesses a tool to recruit investment and that members are ready to work with opportunity funds.

    What's next

    The nominations still require final approval from the Treasury Department. Questions about the downtown Alamogordo and Tularosa redevelopment areas go to those municipalities and their MainStreet programs. The Otero County Attorney's Office is handling questions about the Bypass corridor and countywide coordination, at (575) 437-7427.

    Sources: Otero County Office of the County Attorney news release, Nov. 9, 2026; Otero County Administration Facebook post, Nov. 10, 2026.

    More News from Alamogordo
    I'm interested
    I disagree with this
    This is unverified
    Spam
    Offensive