Findings to help fund managers increase capital, maximize positive effects on areas in need
SAN JOSE, Calif.–(BUSINESS WIRE)–Despite heated debate about the merits of the Opportunity Zones (OZs), the new OZ impact investing report from JTC Americas and OpportunityDb shows the program is achieving its aims by attracting investments in social impact projects that might not be made without OZ incentives.
The survey found that nearly 70% of existing and aspirational OZ investors consider the program’s incentives enough to consider investments they would not otherwise make; what’s more, over half (54%) would be willing to accept a lower financial return if they were investing in a good impact project, like OZs – and over 30% would take a reduction of over 25%.
“The research shows that the Opportunity Zone program inspires investment in underserved communities that would otherwise be overlooked,” said Reid Thomas, chief revenue officer and managing director of JTC Americas, the largest provider of specialty fund administration solutions for OZs. “In the face of extreme social and economic challenges over the past couple of years, Opportunity Zones continue to demonstrate tremendous resilience and impact—spurred on by both the program’s incentives and investors’ increasing focus on social impact.”
Yet while respondents understand the social and financial benefits OZs provide—74% summarize the program as an equally beneficial solution for communities in need and wealthy investors – they aren’t intuitively connecting OZs and impact investing. These perceptions come even as respondents expect OZs to play a prominent role in impact investing in the coming year. The issue likely stems from a lack of proactive communication by fund managers about OZs’ impact potential and measurement, which are fundamental to aspirational OZ investors.
“Fund managers need to be more front-footed when educating investors about the positive social impacts that Opportunity Zone investments offer, from an impact measurement and marketing perspective,” said Thomas. “After all, Opportunity Zones are impact investments. The more investors understand this, the more capital can be raised, and the more likely OZs can reach their full promise.”
The snapshot of OZs captured in this report gives a picture of a program that is at once satisfying its mission and still rife with untapped potential from aspirational investors. Yet, just as the data collected provides a look into where OZs currently stand, they also point to the future.
“Opportunity Zones are at the crossroads of impact investing and tax-advantaged investment, which can economically revitalize some of the poorest areas of the United States with new real estate and business development,” said Jimmy Atkinson, founder of OpportunityDb, a platform providing tools, education, and analysis for current and potential OZ investors. “This report helps outline the current momentum of the program and how it can continue to improve.”
The full research report can be found here.
About JTC Americas
JTC Americas is the North American division of JTC, a worldwide leader in financial administration with over 1,200 employees across 26 jurisdictions and a 30-year track record in Private Equity, Fund of Funds, Alternatives, Commercial Real Estate, Debt Funds, and much more. JTC is a publicly listed, global professional services business with deep expertise in fund, corporate and private client services. JTC Americas works with JTC’s institutional and private clients to provide boutique service with a global reach, allowing US-based clients to expand overseas and international clients to enter US markets. JTC Americas is the industry leader in Specialty Financial Administration, providing bespoke services for markets characterized by high administrative and regulatory complexity, elevated transaction security needs, and challenging compliance requirements. This includes tax-advantaged investments (1031 Exchange, Delaware Statutory Trust), Impact & ESG (EB-5, Opportunity Zones) and alternative investments in the US and abroad (AIFM, ManCo, Fund of Funds). By offering its specialized technology-based solutions to the greater market and combining its boutique feel with JTC’s global reach, JTC Americas can provide an unprecedented level of support and scalability for clients of all sizes. To learn more, visit jtcamericas.com.
About OpportunityDb
OpportunityDb provides world-class tools, education, and analysis to help individual investors, family offices, real estate developers, and industry service providers navigate the ins and outs of the Opportunity Zone program—empowering them to help create positive social impact in under-invested areas of our country. To learn more, visit opportunitydb.com.
Contacts
Matt Kasik—Greentarget
[email protected]
847-772-1155
