By Opportunity Zone Magazine Staff
Utah-based urban-infill specialist PEG Capital Partners has raised $100 million in committed capital for a planned $250 million fund that will invest in Opportunity Zone projects with a focus on the Western United States.
The PEG Opportunity Zone Impact Investors fund will initially focus on around a dozen projects in Arizona, Utah, Minnesota, and California, with total asset value of around $700 million, says PEG partner and COO Jameson Haslam. The fund will back a blend of residential apartments, hotels, and office developments, plus a limited number of industrial projects.
Most of the fund’s current projects were in development well before the OZ program was finalized, offering investors a chance to move quickly to take advantage of OZ benefits.
“In most of the markets we’re investing in, we’re the first early mover with Opportunity Zone projects,” Haslam says.
The fund also gives investors a chance to tap into PEG’s expertise as a company that’s produced or acquired developments worth more than $1.5 billion over the past 15 years, and to invest in projects that would have solid potential even absent OZ benefits, Haslam says.
“The numbers are attractive as standalone projects — they aren’t only interesting because they are Opportunity Zone projects,” he explains.
Construction has already begun on some of the projects, including the Paperbox Lofts development in Salt Lake City, which in March became the first OZ project to break ground in Utah. The 195-apartment project, which uses an innovative automated car-stacking parking system to cope with space restrictions, showcases the kind of creative urban-infill work that PEG is best at — and the kinds of opportunities now available in OZs, explains PEG chief executive officer Cameron Gunter.
“Deals that qualify for the Opportunity Zone benefits are right in our wheelhouse,” Gunter says. “Ultimately, the Opportunity Zone program connects to what PEG does well – urban infill redevelopment and creative uses of space.”