By Erika Morphy
NEW YORK—The general consensus about Opportunity Zones has been that while interest in these areas is intense, there has been little activity. Most of the capital poised to invest in Opportunity Zones, so the theory goes, is waiting on the sidelines until the Treasury Department clarifies more regulations. Indeed, a recent report by Reonomy found that investment levels and prices in Opportunity Zones are actually declining, as investors wait for more clarity.
A study by Real Capital Analytics disputes this notion, finding that both investment and prices are rising in Opportunity Zones. Report author Jim Costello found that there are signs that the program is making a difference when looking at the variation in sales activity between Opportunity Zones and areas that were not selected.
The study looked at both Opportunity Zones and areas that were not selected to be part of the program—tracts that Real Capital Analytics termed “Also Rans.” Theoretically, both of these areas were ripe for redevelopment and both should see more activity as cities grow and populations expand. Read more.