How Opportunity Zone Legislation Could Impact REITs
July 24, 2019 | Beth Mattson-Teig | Nareit
New “opportunity zone” legislation has sparked a frenzy of excitement across the commercial real estate industry among investors, including REITs, that are hoping to grab a share of what some say could be a multi-billion-dollar market.
Opportunity zones are an economic development tool created by the law known as the Tax Cut & Jobs Act of 2017, which use the incentive of a deferral or elimination of capital gains recognition to spur private capital investment in economically-distressed communities.
Sponsors came out of the gate quickly, structuring investment vehicles that would allow them to start raising capital soon after the program was introduced. The second round of Treasury Department guidelines, released in April, provided much needed clarity and has further accelerated activity.
