How OZ Capital Revived A Vacant Landmark, With Joel Mazza & Bob Erlanger

A vacant 1939 high-school building that plagued downtown Mount Vernon for a quarter-century is now The GRAD Apartments—38 fully leased luxury units—thanks to Joel Mazza and Bob Erlanger of Erma Capital. In this episode, they reveal how layering Opportunity Zone equity with a 15-year local tax abatement turned a condemned eyesore into a community showpiece, and what their success means for the next wave of historic-reuse projects in small-town America.

Guest: Joel Mazza & Bob Erlanger

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.

Listen Now

Episode Summary

In this episode of The Opportunity Zones Podcast, host Jimmy Atkinson is joined by Joel Mazza and Bob Erlanger of Erma Capital to discuss their remarkable Opportunity Zone development: The GRAD Apartments in Mount Vernon, Ohio. What was once a long-abandoned historic school has now been transformed into a vibrant residential community—thanks to a blend of OZ capital, local tax incentives, and persistent vision.

From Blight to Beacon: The Story Behind The GRAD

The former Mount Vernon High School—later a middle school—had sat vacant since 1996. Joel and Bob, both with deep family roots in Mount Vernon, saw more than just a dilapidated building. They saw potential for community revitalization. Despite previous failed attempts by other developers, they acquired the property and preserved the historic structure, initiating a massive adaptive reuse project that would become The GRAD Apartments.

Why Preservation Over Demolition?

The site offered several key advantages:

  • It occupied an entire city block—no land assemblage required.
  • Its location in a designated Opportunity Zone opened the door to significant federal tax benefits.
  • They secured a Community Reinvestment Area (CRA) designation from the city, enabling 15 years of property tax abatement on improvements.

These two layers of tax incentives—federal (OZ) and local (CRA)—were essential in making the project financially viable.

Financing and Project Phasing

The developers initially funded the property purchase and early demo work with their own OZ-eligible capital gains. As interest rates began to rise, they acted quickly to secure favorable construction financing from WestBanco. They also demolished non-historic additions to the building while preserving the original 1939 structure, designed by renowned architect Vernon Redding.

The project was executed in phases:

  • Phase I: 38-unit luxury apartment conversion, 32 of which are already completed and leased.
  • Phase II: An additional 64 units to be built at the rear of the site.
  • Future Pipeline: Two more OZ-eligible sites in Knox County are in development.

Total development costs for future phases are expected to exceed $10–15 million each, with equity needs in the $4–7 million range per project.

Community Reception: From Skepticism to Support

At first, local stakeholders were skeptical. The city had condemned the building and demanded a tight project timeline. Joel and Bob had to post a performance bond and push through early legal and political hurdles. But as demo and construction progressed, the community rallied. Locals began sharing personal memories and expressing excitement for the property’s revival.

Their efforts culminated in the project receiving the 2024 Knox County Historic Preservation Award—an honor they hadn’t even known they were being considered for.

Leasing Success and Market Demand

The first 32 units of The GRAD leased out within 42 days—far exceeding expectations. With over 60 vetted applicants still on a waitlist, the team sees strong ongoing demand. The building has attracted a wide demographic—from retirees to young professionals—drawn to the walkable, amenity-rich lifestyle near Mount Vernon’s historic downtown.

Lessons for Other OZ Developers

Joel and Bob offer several key takeaways:

  • Get the right team in place. Their zoning attorney not only secured the CRA but helped draft it. Having experienced professionals—from legal to architectural to engineering—was critical.
  • Persistence pays. The early battles with city officials required grit and a long-term mindset.
  • Look for layered incentives. The combination of OZ benefits and local CRA tax abatements created a compelling capital stack.
  • Preserve what matters. Historic charm and community nostalgia helped fuel demand and civic goodwill.
  • Leverage success. Their initial win has smoothed the path for future projects in the region.

What’s Next for Erma Capital

Joel and Bob are now preparing to raise additional Opportunity Zone capital to fund Phase II of The GRAD and two new developments nearby. They’ll be presenting these deals at the upcoming OZ Pitch Day on June 19.

For developers interested in revitalizing legacy properties in Opportunity Zones, this episode offers a powerful case study in how historic preservation, community engagement, and incentive stacking can come together to unlock hidden value.