Plan goes Deep with Opportunity Zone
Oklahoma County is a top opportunity zone investment area, and even as investors await detailed federal tax regulations before plunging in, Lincoln Square South, a mixed-use project long in the works in old east Deep Deuce, is poised to benefit.
Broker- attorney Bert Belanger said local investors have been putting together property for years in the long- neglected area bounded on the west by Lincoln Boulevard, the east by High Avenue, the north by NE 4 and south by the Union Pacific Railroad line. The Planning Commission has approved the planned unit development and it goes before the City Council on April 9.
“We expect approval, as we have worked very closely with planning staff and with the Alliance for Economic Development,” said Belanger, an attorney with Riggs Abney Law Firm and a principal in the landowner group.
The alliance promotes development by coordinating land, incentives and other economic tools including urban renewal, tax increment financing districts, public-private redevelopment — and Opportunity Zones.
“The Opportunity Zone was a pleasant surprise from D.C.” Belanger said.
Opportunity Zones and associated Opportunity Funds are meant to attract capital investment to low-income areas by providing for deferred and reduced capital gains taxes. The idea is to entice investors into plunging gains from property or stock sales into development.
The area seems to be what creators of Opportunity Zones had in mind when the enticement to reinvest was tucked into the federal tax reform law in late 2017. Its 15 blocks and 160 parcels across about 25 net acres — not counting the streets — are mostly blighted, with overgrown empty lots, dilapidated houses and abandoned businesses. Even the streets need work; one stretch of NE 1 isn't paved.
There is life, however. Several homes are still occupied, and a few churches and missions are in operation.
Plus, frontage along NE 4, the heart of Oklahoma City's historic African- American commercial and cultural corridor — including Jewel Theatre, dating to 1931 — lends the area legacy and promise.
Belanger said investors taking advantage of the Opportunity Zones and Opportunity Funds could give Lincoln Square South a solid launch.
Oklahoma has 117 Opportunity Zones, including 30 in the Oklahoma City metro area, including the Medical-Innovation District, the Adventure District, the NE 23 corridor and the central business district (extended to Bricktown, the Arts District, Film Row, Deep Deuce, Automobile Alley and the Boathouse District).
Lincoln Square South is on the south end of the zone including the Innovation District surrounding the University of Oklahoma Health Sciences Center.
Multiple property owners are collaborating in the project and vision for a flexible “urban village” design “as market forces dictate,” according to a design statement prepared by Belanger. Sponsors of the planned unit development include Garrett and Co. LLC, Ocean Properties LLC, P&M Land Partners LLC, Downtown Brownstone LLC and Moyer's Factory Warehouse Inc.
Oklahoma Countyis the 42nd most attractive opportunity zone investment area as defined by COMMERCIALCafe, a real estate information and online listing company. The company ranked counties based on indicators such as economic production, population growth, number of eligible zones, and poverty rates in each area, attributing points for each and calculating the total.
Details on exactly how the reinvestments will work, and what kinds of properties are eligible, are being worked out, according to the Council of Development Finance Agencies, based in Columbus, Ohio.
Brownfields — sites with environmental contamination — apparently are out, the council reported this week, but it noted the U.S. Department of Housing & Urban Development has expanded the LowIncome Housing Tax Credit to encourage investments in Opportunity Zones.