How Much Capital Have Opportunity Fund Managers Raised?

Published by Michael Novogradac on Friday, June 28, 2019 - 12:00am

In May, Novogradac began surveying the funds listed on Novogradac’s Opportunity Funds Listing as to dollars raised and investment plans. The opportunity funds are listed as a free service to potential community development funding recipients. The information listed is based on information provided to Novogradac by the listed contact person for each company. To be included in this list, please contact [email protected].  It is important to note that this listing of funds reflects a subset of all opportunity funds that have been formed and have raised, or are raising, investment capital.  Many funds have been formed, raised capital, and invested dollars in opportunity zones, for which there is no public data.  In due course, these funds do report some of this information to the Internal Revenue Service (IRS), as part of annual tax filings, and in the future are expected to have more robust (IRS) reporting requirements.  Which means more comprehensive information will be available, eventually, in some form, from the IRS.

At the time of this writing, the Novogradac Opportunity Funds Listing has 136 funds, up from 132 at the time of the May survey. In the aggregate, the 136 listed funds are seeking to raise more than $29 billion for investment in opportunity zones. Preliminary results of Novogradac’s initial survey, based on more than 40 responses from funds, show that as of late May, the responding funds had raised $790 million.  More than 60 percent of the responding funds had raised at least $3 million, and of those, the average raise was more than $31.5 million, with a median of $15 million.

The funds run the gamut of geographical footprints from local, to regional, to state and multi-state, to national. The targeted investment areas for the funds as whole range from mixed-use, industrial, office, retail, multifamily, student housing and senior housing to hospitality, renewable energy, disaster relief and professional sports.  

Novogradac will survey the funds again in mid-July and report back. We expect the amount of capital raised to increase markedly in our July results because of the June 28 deadline related to the OZ’s 180-day reinvestment requirement for 2018 partnership capital gains. 

In the meantime, we have other findings to share about the funds’ plans for the capital they continue to raise. For example, more than 50 percent of the responding funds plan to use other tax incentives in conjunction with the OZ. This demonstrates the significant role that other federal, state and local tax and other incentives play in directing and increasing investment in opportunity zones.

In addition, 33 percent of responding funds plan to invest in operating businesses, but only 8 percent were focused on operating businesses only. This means that 92 percent of responding funds also plan to invest in real estate.  Moreover, 69 percent of responding funds indicated they planned to exclusively invest in real estate.

Seventy-nine percent of all respondents plan to invest in housing, with 41 percent of the responding funds planning to only invest in housing.

Of those funds that had raised the collective $790 million as of late May, the numbers shift slightly. Those respondents plan to invest in:

  • housing only – 23 percent
  • only housing and non-housing related real estate – 39 percent
  • real estate and operating businesses – 38 percent
  • operating businesses only – 1 percent

Of the 17 responding funds that plan to invest in affordable housing, nine say they plan to use low-income housing tax credits.


The information contained on this page is for informational purposes only and does not constitute an offer to sell or solicitation of an offer to buy securities. Novogradac does not provide investment advice and the information on this page is not to be construed as a recommendation to engage in any specific transaction. Readers are urged to consult with their own professional advisors if they are considering investing in a QOF.