By Opportunity Zone Magazine Staff
With 8,700 designated opportunity zones in the United States, finding impactful investment within the zones has become an interest to many in the community development realm. The HBCU Community Development Action Coalition (CDAC) has taken the initiative by launching a $50 million HBCU-focused Opportunity Zone Fund to spur reinvestment in and around Historically Black Colleges and Universities (HBCU).
“Over half of the 107 HBCUs and their communities are located in Opportunity Zones. Therefore, we are focusing on developing a pipeline of projects that will have a significant impact on those communities,” says Ron Butler, Chief Executive Officer of the HBCU-CDAC.
Through a partnership between HBCU-CDAC and Renaissance Equity Partners, an investment banking and advisory firm, the Renaissance HBCU Opportunity Fund seeks to attract investment capital to help fund development of mixed-use projects on or near HBCU campuses located in Opportunity Zones, said Robert K. Jenkins Jr., of Renaissance Equity Partners.The Fund is receiving support from the Kresge and Rockefeller Foundations through the Opportunity Zones Incubator, which is providing technical assistance to help bring the Fund to market.
“Renaissance Equity, the HBCUs and community leaders are working with us to create plans for new capital to flow into economically distressed communities strategically,” says Butler.
The Opportunity Zones program was established by Congress in the Tax Cuts and Jobs Act (TCJA) of 2017 to encourage long-term investments in low-income urban and rural communities. Investors can receive a tax incentive for re-investing their unrealized capital gains into Opportunity Funds that invest in Opportunity Zones nationwide.
“The Renaissance HBCU Opportunity Fund will be the vehicle through which the OZ funds will flow into projects that help transform HBCU economically distressed neighborhoods. Our goal is to launch a $50 million OZ investment fund to spur transformation of these communities,” says Butler.
HBCU-CDAC and Renaissance Equity Partners are pursuing mixed-use projects that attract business and establish workforce housing opportunities aimed at junior faculty, staff, graduate students and military veterans with GI Bill benefits. The Fund plans to structure each investment transaction in a way that neighboring HBCU can share in the financial success of the project.
“The OZ program could be a game changer for many underserved communities,” says Butler.