Qualified Opportunity Funds (QOFs) offer investors a unique opportunity to invest in designated Opportunity Zones (OZs) throughout the United States while receiving significant tax benefits. QOFs were introduced as part of the Tax Cuts and Jobs Act of 2017 and were initially focused on real estate investments. However, the industry has since expanded to encompass a wider range of investment opportunities. This article will explore some examples of Qualified Opportunity Funds and the investment opportunities they offer.
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Related
Read The Lifecycle of an Opportunity Zone Investment:
Part 1 – Getting Started
Part 2 – What Do We Know Now, And What Is Yet To Come?
Part 3 – The Opportunity Zone Tax Benefits Explained
Part 4 – Forming a Qualified Opportunity Fund: The Opportunity Zone-Compliant Investment Vehicle
Part 5 – Structuring an Opportunity Zone-Compliant Investment
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Examples of Qualified Opportunity Funds
The PNC QOF – The PNC QOF is a QOF that is focused on investing in real estate projects located in OZs. The fund is managed by PNC Real Estate and seeks to invest in projects that will create jobs and promote economic development in underserved communities. The PNC QOF has a diversified portfolio of investments, including multi-family, office, and retail properties. The fund also commits to sustainability and seeks to invest in projects that have a positive impact on the environment.
Calibre Tax Advantaged Opportunity Zone Fund – The Caliber Tax Advantaged Opportunity Zone Fund is a QOF that invests in a variety of projects, including real estate, renewable energy, and infrastructure. The fund seeks to invest in projects that have the potential to generate long-term, stable returns for investors while also creating a positive social impact in the communities where the projects are located. The Caliber Tax Advantaged Opportunity Zone Fund has a diversified portfolio of investments, including solar farms, medical facilities, and affordable housing.
EJF OpZone Fund – The EJF OpZone Fund is a QOF that is focused on investing in real estate projects located in OZs. The fund is managed by EJF Capital and seeks to invest in projects that will create jobs and promote economic development in underserved communities. The EJF OpZone Fund has a diversified portfolio of investments, including multi-family, office, and hotel properties. The fund also commits to sustainability and seeks to invest in projects that have a positive impact on the environment.
Goldman Sachs Urban Investment Group – The Goldman Sachs Urban Investment Group is a QOF that focuses on investing in underserved communities, with a focus on creating jobs and promoting economic development. The fund invests in a variety of projects, including affordable housing, commercial real estate, and community facilities. The Goldman Sachs Urban Investment Group is known for its commitment to social impact investing and its ability to leverage its vast network of resources to support the success of its investments.
New Investment Opportunities
While QOFs were initially focused on real estate investments, there has been a recent trend of investing in other types of projects. Here are some new investment opportunities that QOFs are exploring:
Renewable Energy Projects – QOFs are increasingly investing in renewable energy projects, such as solar and wind farms, located in OZs. These projects provide clean energy to underserved communities while also generating returns for investors. The tax benefits offered by QOFs can help to offset the high upfront costs of renewable energy projects, making them more accessible to investors.
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