Opportunity Zones Office Hours – May 2025

On this month’s live episode of OZ Office Hours, OpportunityZones.com founder Jimmy Atkinson addresses OZ legislative updates and answers live viewer questions.

Join Jimmy the first Monday of every month at 3:00 PM Eastern Time, to get your Opportunity Zones questions answered live.

About The Opportunity Zones Podcast

Hosted by OpportunityZones.com founder Jimmy Atkinson, The Opportunity Zones Podcast features guest interviews from fund managers, advisors, policymakers, tax professionals, and other foremost experts in the Opportunity Zones industry.

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Episode Summary

In this live “Office Hours” episode of The Opportunity Zones Podcast, Jimmy Atkinson answers listener questions and discusses the latest developments in Opportunity Zones legislation, investment strategies, and fund structuring.

Latest on OZ Legislation and Timeline

Jimmy opened the show by addressing the most frequently asked question: “What’s happening with OZ legislation?”

  • Congress is actively working on a tax bill that includes an extension or renewal of the Opportunity Zones program as part of President Trump’s broader tax agenda.
  • Procedural steps like budget resolutions have been passed in both the House and Senate, enabling the use of budget reconciliation to pass tax legislation.
  • A “marker bill” specific to Opportunity Zones is expected soon. This bill won’t pass on its own but will feed into the larger tax reform package, potentially mirroring the process used in the 2017 Tax Cuts and Jobs Act.
  • Speaker Mike Johnson has expressed a goal to pass the final tax bill by Memorial Day, though Jimmy considers that overly optimistic. A summer or year-end timeline seems more likely.

Key OZ Reform Ideas Under Consideration

Jimmy reviewed several ideas that may be included in OZ 2.0 legislation:

  • Extension of the current program or creation of a new OZ map starting January 1, 2027.
  • Rolling deferral period: Allowing a seven-year deferral regardless of when the gain is rolled over.
  • Allowing non-capital gains to invest: Ideas include permitting after-tax dollars or ordinary income to access certain OZ benefits.
  • Incentives for rural development and affordable housing.
  • Reintroducing reporting requirements, though subject to budget reconciliation limitations.

Questions from the Live Audience

Jimmy fielded several live questions, including:

  • How to influence future OZ designations: Developers should start engaging with state governors and economic development offices now to ensure their areas are considered for OZ 2.0.
  • What if your property straddles census tracts? The opportunity to redefine OZs based on the 2020 census could take effect by January 1, 2027. The nomination process will most likely be governed at the state level.

Investing Strategies and Sector Outlook

Jimmy provided guidance for high net worth investors sitting on cash:

  • Most OZ investments are ground-up real estate development, with multifamily, workforce housing, industrial, and self-storage currently favored.
  • He’s cautious on office and retail sectors but sees opportunity in markets with positive long-term fundamentals.
  • He highlighted Capitol Square’s Scott’s Addition development in Richmond, VA, and Sola Impact’s Beehive campus in South Central LA as transformative OZ projects.

Existing Property Owners and OZ Eligibility

A common question from landowners: “How can I benefit if I already own the property?”

  • Generally, property must be acquired by a QOF after 12/31/2017 to qualify.
  • Options include an arms-length sale to a QOF or ground lease structure, provided the original owner retains less than 20% of the new entity.
  • Jimmy advises marketing such properties as OZ deals to attract investor interest.

Fund Structuring and Compliance Advice

For emerging fund managers, Jimmy covered:

  • Fee structures: Management fees (typically 1–2%) and carried interest (often 20% over a preferred return of ~8%) should be clearly outlined in the PPM and operating agreement.
  • Working capital safe harbor: If cash is deployed into a QOZB with a written plan, it can remain in cash for up to 31 months while preserving OZ compliance.
  • Use of administrators: Platforms like JTC Americas or Juniper Square can help track distributions, produce K-1s, and maintain compliance.

Conclusion

Jimmy emphasized the importance of staying proactive:

Legislative action may take months, but now is the time to engage with policymakers, prepare OZ investment theses, and educate investors.

Visit OpportunityZones.com/map to check OZ status using the original 2010 census map.