Inland Private Capital Corporation, an alternative investment management firm, has fully funded its first qualified opportunity zone fund, Saint Paul Opportunity Zone LLC, and is no longer accepting new investors. The fund raised more than $30 million in equity.
The fund acquired approximately 2.3 acres of land in downtown Saint Paul, Minnesota for $5 million in August 2019. The site is comprised of two contiguous parcels, referred to as the Seven Corners Gateway Site, that previously functioned as a parking lot for downtown commuters.
The fund plans to develop a 120-room hotel, operated under a nationally recognized brand, and a six-story, 144-unit apartment community. Twin Cities-based developer, Kaeding Development Group, has been engaged as the developer for the project.
Both the hotel and apartment community will include retail and dining options on the first floor, and the company said that several commercial tenants have already expressed interest in leasing the spaces.
The fund intends to secure a construction loan for the development and will likely have a total project cost of approximately $66 million.
“We were thrilled to launch our qualified opportunity zone… platform with Kaeding, a strategic partner we have worked with in the past, to acquire an infill development site that benefits from such a wide range of demand drivers,” said Keith Lampi, president and chief operating officer of IPC. “IPC’s [qualified opportunity zone] platform is unique in contrast to many of the blind pool funds that have recently hit the market, as it is designed to provide investors access to specific development projects on a project-by-project basis.”
The Seven Corners Gateway Site is positioned directly across from the Xcel Energy Center arena, home of the Minnesota Wild National Hockey League team, as well as the Saint Paul RiverCentre, the city’s convention center for special events and entertainment.
The development project, once complete, will serve as an additional amenity to the heavily developed area which includes retail, dining and entertainment options.
Inland Private Capital Corporation has sponsored 248 private placement real estate offerings, with investments and developments in the multifamily, self-storage, hospitality, healthcare, student housing, retail, corporate office and industrial sectors, as of September 30, 2019.
Many of the firm’s offerings have been designed for investors seeking replacement property to complete an IRS Section 1031 exchange. Inland Private is recognized as the largest provider of securitized 1031 exchanges, with a footprint of 600 properties, representing approximately $7.7 billion in assets under management as of September 30, 2019.