Tag Archives: Bisnow

Rapid increase in funds invested in Opportunity Zone Funds

Despite the laments that I have heard of late at various conferences and read in various articles, Opportunity Zones are, in our little slice of the world, very busy, very active and, per both Novogradac and Bisnow, OZ Funds who are focused on raising third party equity have seen a marked increase in funds under management in the last few months and have raised approximately $4.5B to date. While this is indeed less than the $6T of unrealized capital gains estimated to be available to invest, it is still a very sizable sum of money.

Per Novogradac, of the 366 funds that they track which represent a targeted funding level of $65.7B if fully funded, 184 Qualified Opportunity Funds have reported back and have raised $4.46B with a funding target for those 184 QOFs of $25.17B. This level of $4.5B is up significantly from September when these same funds had raised $2.5B.

Many folks we work with are focused on the 12/31/19 deadline to invest capital gains into a QOF in order to obtain the 15% reduction in amount subject to capital gains benefit; BUT, as indicated previously, the sky does NOT fall if you miss this date, Armageddon does NOT happen – rather, the investor is eligible for a 10% reduction in 2020 and 2021 if they invest capital gains in those calendar years. So, the program is far from over, far from reaching its potential but is alive and doing well and making progress and moving in the right direction, if right is to attract equity capital in low and moderate income areas that were designated as Opportunity Zones.

My team and I are in the office and working on closing the 39 OZ deals we are currently working on for clients who have pushed forward and are moving deals towards the goal line. Kudos and thank you to those 29 clients for whom we have already closed deals for. We appreciate your business and count our blessings to have worked with you on these fun and exciting projects.

If you have questions or comments, please let us know as we are happy to chat OZs and investments and deployment or anything else you would like to discuss.

Have a wonderful holiday season!