Opportunity Zones

Opportunity zones are meant to encourage development and job creation in low-income communities. To do this, opportunity zones allow investors who invest unrealized capital gains in opportunity funds to defer paying capital gains income tax on the money until 2026. These funds are then invested into the OZ. If 90% of the investment stays in the zone for ten years, investors can avoid paying the capital gains tax altogether. In New York there are 306 opportunity zones.

Opportunity Zones Q&A

How were opportunity zones created?
Opportunity Zones were created by the Tax Cuts and Jobs Act on December 22, 2017. The first OZs were designated the following April.
How do opportunity zones influence the real estate market?
Intended to spur development in low-income communities, opportunity zones create an incentive for the real estate industry to move more money into underdeveloped areas. In New York, opportunity zones are largely residential. The chance to invest tax-free in a property or development within an opportunity zone is an incentive for many investors.
Who is impacted by opportunity zones?
Investors with real estate interests, or who are looking to increase their real estate interests, may benefit from opportunity zones. Their effect on residents of the zones are more unclear. Although the stated intention of the opportunity zones is to create jobs and increase the quality of living in the zones, some suggest that opportunity zone development causes gentrification and are a giveaway for the rich; others suggest that they are simply not as effective in alleviating poverty as they claim to be; and still more suggest that the long-term effects of opportunity zones are yet to be seen.
Want to know more about opportunity zones?
Check out our Top Stories below for TRD's most up-to-date coverage of opportunity zones.

Opportunity Zones Top Stories

September 10, 2019Why a Hell’s Kitchen census tract is in the Opportunity Zone program
September 9, 2019CrowdStreet, a real estate crowdfunding firm, launched its own Opportunity Zone fund targeting $20 million.
August 12, 2019State senator James Sanders Jr. on New York state and city Opportunity Zones.
August 9, 2019“Um, news flash, the rich will get richer anyway.”

The Latest

Joshua Burrell and excerpts from the court document (Activated Capital, United States District Court)

Manhattan investor charged in Opportunity Zone fraud

A real estate fund manager in Manhattan was indicted Tuesday, charged with securities and wire fraud and aggravated identity...

Manhattan investor charged in Opportunity Zone fraud
322 Grand Concourse in the Bronx and Martin Nussbaum of Slate Property Group and Scale Lending (Google Maps, Slate)

Bronx multifamily development gets $63M loan

Simon Kaufman’s YS Developers scored a $63 million construction loan for a 14-story, 151-unit residential development in the Bronx....

Bronx multifamily development gets $63M loan
President Joe Biden (Getty, Education Next)
National

Biden administration considers Opportunity Zone overhaul

A Trump-era tax incentive was meant to drive investment into parts of the country that were struggling economically. Spoiler...

Biden administration considers Opportunity Zone overhaul
New York State Senator Michael Gianaris (Getty, iStock)

New York deals a blow to Opportunity Zones program

New York will no longer offer some state tax benefits to real estate investors funding Opportunity Zone projects, dealing...

New York deals a blow to Opportunity Zones program

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