Opportunity Zones Successfully Serving Communities

Opportunity Zone investing was created by the Tax Cuts and Jobs Act of 2017 to encourage private investment in areas that would typically be overlooked for development. By providing unique tax incentives for long-term investments, this bipartisan initiative aims to make positive impacts on low- to middle-income areas that are in need of development. To many potential Opportunity Zone investors, the desire to drive positive impact in underserved communities is as motivating if not more motivating than the tax break and potential for financial growth of these investments. In this article, we will explore two specific Opportunity Zone developments happening now, and their potential impact on their communities. 

A New Mixed-Use Development: Ogden Commons in Chicago

A major feather in the hat of the Opportunity Zone investing concept is the current and planned development of Ogden Commons, a historically underserved African American community on the west side of Chicago. Utilizing 10 vacant areas that were once the home of the troubled and now demolished Ogden Courts and Lawndale public housing development, this new project will bring 120,000 square feet of commercial space and more than 350 mixed-income housing units to the area. The investment and planning team includes PNC Bank, The Habitat Company, the City of Chicago, the Philipsborn family and the Chicago Housing Authority. 

The first phase of the project is now complete. A 30,000 sq ft building brings a Wintrust Bank Branch to the community as well as three minority owned restaurants. This first building will also house an outpatient medical facility operated by Mt. Sinai Hospital. Medical facilities and bank branches are often overlooked necessities in underserved communities, so these additions will serve local residents well. The project has focused on job creation from the get-go, hiring local contractors to do the work. The 350+ units of housing currently under construction will be affordable, with 40% slated to become Chicago Housing Authority units, 50% offered below-market-rate with affordable housing tax credits and the remaining 10% offered at market value. Ogden Commons is scheduled to be completed in 2026. 

An East York Street Project in the Kensington Neighborhood of Philadelphia

In the 1950s, Philadelphia was booming with factory work, in the steel sector and also in textiles. Over the past several decades, economic change has caused most of these factories to be closed, leaving large shuttered industrial buildings scattered throughout, and leaving the surrounding communities without sustainable job opportunities. As such, several large neighborhoods in Philadelphia have been designated as Opportunity Zones, including most of Kensington, where a large development spurred by the PNC Opportunity Zone Fund is in the works. 

Kensington is currently experiencing a resurgence of development and vibrancy. In fact, Philadelphia’s master plan calls for more transit-oriented housing, and the PNC Opportunity Zone Fund has gone in on a development with Civetta Property Group located at 2120 East York Street. Once home to one of the many old factories of Philadelphia, Civetta had already demolished the decaying building in preparation for new development in the Opportunity Zone when planning began. The project is a mixed-use building with 56 housing units slated for workers with modest incomes, built atop commercial space on the ground floor. The housing units will be made available to local workers making 80-100% of the area’s median income, and priced so they will be paying no more than 30% of their income to housing costs. The building has now been completed and apartments are available to rent. 

How can I find a Qualified Opportunity Fund focusing on positive social impact in my area?

Opportunity Zone investing opens the door for investors to make wise investment decisions while providing much needed development options to impoverished areas. The OZ FundHub blog will continue to highlight developments and success stories of Qualified Opportunity Funds working to bring equity to communities. If you are expecting a capital gain or have recently experienced one, use our OZ FundHub Fund Finder tool to find Qualified Opportunity Fund profiles that meet your investment goals. Or, join our OZ Forum to communicate with fund managers directly.

 *Important Notice: OZ FundHub is not a licensed tax, accounting, or financial firm. All Information contained is for educational purposes only.*