Opportunity Zone Investment in Ohio
320 Opportunity Zones in Ohio
The federal tax bill passed on Dec. 18, 2017, included the Opportunity Zone program, which gave states the chance to examine census tracts and nominate low-income areas with potential for long-term investment to be targeted for a tax-incentive program.
After being designated by the U.S. Department of Treasury, Ohio’s 320 Opportunity Zones began generating attention from investors interested in taking advantage of their favorable tax benefits. Meanwhile, communities, potential project owners, and economic development organizations are eager to provide opportunities to investors.
Opportunity Zones, created in the 2017 Tax Cut and Jobs Act, encourage long-term investments in low-income urban and rural areas nationwide.
A few facts on Opportunity Zones:
Working with the U.S. Treasury, Ohio established 320* Opportunity Zones throughout 73 of its 88 counties.
The zones were selected based on submissions by local government officials and nonprofit and economic development organizations.
Long-term investments in designated opportunity zones provide tax benefits for investors to maximize unrealized capital gains.
In Ohio, Opportunity Zones are available in large cities, small communities, and Appalachian counties.
Current Investment In Ohio:
In Ohio, seven (7) investment projects are underway while five (5) opportunity funds have been established.
Summary of Funds:
Lima Opportunity Fund - The city of Lima, OH, will create an Opportunity Zone Equity Fund with the help of Arctaris Impact Investors, a social investing firm, to foster investment into the city's OZs. The city's $5m commitment alongside the Lima Chamber Foundation will be matched with $20m from Arctaris, with the potential to leverage up to $100m for real estate and business investment in the city.
Nest Opportunity Fund - Beacon Hill Investment Advisory is launching the Nest Opportunity Fund for investors in Central Ohio. The $50m real estate investment fund will renovate homes for rent and sale in low-income communities in Columbus, OH, and Lexington, KY.
Fifth Third Bank Opportunity Funds - Fifth Third Bank announced that it would invest $100 million in projects that support community development by mid-2020 through four Opportunity Zone fund partners. The National Equity Fund, an affiliate of LISC, and Raymond James will be the first two partners to identify and structure investments meeting the Bank's criteria. In the Chicago area, Fifth Third will partner with the Decennial Group for $30 million of this commitment. The funds will be used to invest in affordable housing, community priorities such as bringing grocery stores to food deserts, and other activities that support entrepreneurship, job growth, and well-being in low-income communities.
Opportunity CLE Development Fund - The Greater Cleveland Partnership launched a $50M real-estate investment fund to spur private investment in Opportunity Zones in Cuyahoga County. The fund was launched by Cleveland Development Advisors.
KeyBank Opportunity Fund - KeyBank launched a $50M Qualified Opportunity Fund in 2018, and has since invested in four affordable housing projects in Ohio, Colorado, Connecticut, and Massachusetts.
Source: Economic Innovation Group - https://eig.org/