I have been in commercial real estate for 20 years and have not figured out how to start securing the benefits for developing within an Opportunity Zone. What are some generalized initial steps I can take to get started?
The way a developer may benefit is from investment from a Qualified Opportunity Fund. The tax benefits are granted to taxpayers who realize capital gains and elect to invest in a QOF. In turn, the fund will invest in a project that meets the requirements.
This is too general a question. It looks like you need someone to set up a template program to assist you in marketing properties or development deals within the zones. I recommend you contact one of the CPAs or attorneys listed on this site that is in your area and engage them to set up a program based upon your vision and skill set.
Form entity and self-certify. Very simple if the business is in the Opportunity Zone and is a qualified business.
Need to form a Qualified Opportunity Fund that can invest in properties located within a designated zone.
Since you are a developer, it tells me that you are not asking how you can defer your own capital gain taxes by investing, but how you can capitalize on this market opportunity. The answer is not so simple. Basically, you would have to start your own fund or participate in a joint venture with other professionals in doing so. It would require no less than an attorney, CPA, you (as the developer) and management. It is a pretty substantial undertaking, in particular, if you are going to be the one to offer the fund. My sense is more that you would be well-served to network and partner with investment management groups who have the professional resources to administer the fund and all of its compliance while you do the developing. But if you are serious about having your own QOF that is available to investors, then you will need to start by engaging your team of professionals (lawyer, CPA, management, etc.). It's a much longer conversation from there, but I would suggest going to a couple of Opportunity Zone conferences/seminars, webcasts, etc. Here you will meet various relevant professionals that may be exactly what you need.
I'd consult the IRS' Opportunity Zones FAQ for this. That ought to help get you familiar.
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