New Orleans Redevelopment Fund Closes on its First Qualified Opportunity Zone Fund Investment
New Orleans Redevelopment Fund (NORF) through its newest real estate investment fund, NORF 3 Opportunity Zone Fund, acquired its first project, the former Warwick Hotel, located at 1315 Gravier Street on Monday, June 4th. Shuttered since Hurricane Katrina, the 12-story commercial building consists of 130,000 square feet and is located across from City Hall in downtown New Orleans. The multi-million dollar project is one of the first notable large-scale Qualified Opportunity Zone Fund investments in the region.
NORF’s Development Director, Cullan Maumus, states, “We are excited to lead this transformative project that will breathe new life into the Charity District. It will be a catalyst for the redevelopment of Duncan Plaza, the surrounding neighborhood, and this part of the CBD.”
The closing was well-timed as the fund has received increased interest with for investors with capital gains from 2018 taxable partnerships to realize the full potential of the capital gain tax deferral and benefits from qualified opportunity zone investment.
This project will make use of Federal and State Historic Tax Credits, and potentially New Markets Tax Credits.
The design team for the project will be a joint venture between local design firms SCNZ Architects and Albert Architecture. The General Contractor will be Hernandez Consulting & Construction.
Since 2013, NORF has fought to eradicate blight in New Orleans. With the success of over 50 completed projects within NORF’s first two private equity real estate investment funds, NORF launched the NORF 3 Opportunity Zone Fund. This fund is focused on redeveloping historic-tax-credit-earning-properties in Qualified Opportunity Zones and provides significant tax benefits to investors with capital gains. NORF 3 expects to raise $30 million of equity capital and to expand into neighboring markets such as Baton Rouge, Houston, and San Antonio.
What is an Opportunity Zone Fund? The Tax Cuts and Jobs Act of 2017 provide tax incentives for investors to re-invest capital gains into Opportunity Funds dedicated to investing in specially created geographic districts called Opportunity Zones. The Opportunity Zone program is designed to promote development in economically distressed areas throughout the U.S. by providing tax incentives to investors. NORF 3 Opportunity Zone Fund is one of the premier funds focused on Opportunity Zone investments and is headquartered in New Orleans.