EJF Capital launches Second Opportunity Zone Investment Fund
EJF Capital (EJF) has launched its second real estate Qualified Opportunity Zone Fund, EJF OpZone Fund II LP.
The Fund will launch on 15 April and will focus primarily on real estate multifamily apartment and industrial development opportunities in disadvantaged areas. It follows the successful January 2021 closing of approximately USD280 million in the inaugural EJF OpZone Fund I LP (www.ejfopzone.com) which was launched in August 2018 in response to the federal Tax Cuts and Jobs Act of 2017 to take advantage of the resulting tax benefits for investing in lower income census tracts known as “Opportunity Zones.” There are more than 8,700 Qualified Opportunity Zones across the US. Tax benefits may include capital gains deferral, tax liability reduction and income tax exemptions.
“Opportunity Zone investments have funnelled billions of dollars into communities underserved by capital and have fuelled new jobs and new opportunities for the residents of those communities,” says Neal Wilson, Co-CEO and Co-CIO of EJF. “Moreover, we believe the tax benefits can be quite substantial and that our experience in regulatory driven investment concepts, combined with our industry expertise in financials and real estate, advantageously position EJF to meet the demand for these types of investment opportunities.”
Asheel Shah, Head of Real Estate Development at EJF, adds: “Our investors can see the value of investing in Opportunity Zones. The investments made in this Fund will pay for developments in some of the nation’s lower-income communities, providing jobs, housing and accelerating growth in those areas. Opportunity Zone investments across the country are clearly having an impact, pumping in a substantial amount of private capital across the country.”
EJF’s first OpZone fund has five projects completed including: multifamily apartments in Washington DC, Jacksonville, FL, and Vancouver, WA; one hotel development in Oakland, CA and two industrial buildings in a multi-phase industrial park in Hardeeville, SC (near Savannah, GA MSA).
More projects are currently under construction, including a second multifamily apartment project in Jacksonville, a mixed-use multifamily/office project in Vancouver, WA, and two additional buildings at the multi-phase industrial park near Savannah. Lastly, a multifamily development project in Hyattsville, MD (DC MSA) is seeking final approvals to begin construction. In total these projects represent over USD600 million in total estimated project costs with USD219 million of equity being invested by EJF OpZone Fund I LP.