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Opportunity Zone Funds Continue Tepid Equity Raise in Q3

Opportunity Zone Funds Continue Tepid Equity Raise in Q3. Alternative investments, equity, equity raise, investments, Novogradac, Opportunity Zones, Qualified Opportunity Funds
Opportunity Zone Funds Continue Tepid Equity Raise in Q3. Alternative investments, equity, equity raise, investments, Novogradac, Opportunity Zones, Qualified Opportunity Funds

Novogradac & Company, an accounting and consulting firm that specializing in federal tax credits, announced that qualified opportunity funds tracked by the firm raised just $1.11 billion in new equity during the third quarter of 2023, bringing the year-to-date total to a tepid $3.12 billion.

By comparison, the 1,848 opportunity zone funds tracked by the firm raised $8.29 billion during the same period in 2022 and $5.12 billion in 2021. Novogradac reported that qualified opportunity funds have raised $37.21 billion in equity since their launch in 2019.

As reported by The DI Wire in April 2023, overall investment in qualified opportunity funds tracked by the national accounting and consulting firm was less than $700 million during the first quarter of 2023.

Since 2019, Novogradac says residential construction has been leading investments, with $7.87 billion reported raised by qualified opportunity funds focused exclusively on that area and $30.51 billion raised by qualified opportunity funds that have partial focus on residential investment. Second is commercial development with $2.20 billion raised by commercial-only qualified opportunity funds and $24.73 billion raised by qualified opportunity funds with partial focus on commercial development.

Significant other areas of investment include hospitality ($741.2 million raised by hospitality-only qualified opportunity funds, $4.09 billion raised by qualified opportunity funds with some focus on hospitality), renewable energy ($179.6 million raised by renewables-only qualified opportunity funds, $2.20 billion by qualified opportunity funds with partial focus on renewables) and operating businesses ($299.6 million raised by operating-business-only qualified opportunity funds, $1.11 billion raised by qualified opportunity funds with at least some focus on operating businesses).

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