Opportunity Zones create big potential in OKC
The 2017 Tax Cuts and Jobs Act established the creation of Opportunity Zones to encourage long-term investments to help revitalize areas with lower median incomes. You can learn more about the ins and outs of Opportunity Zones here. Oklahoma City will have eight Opportunity Zones and those zones offer great development potential in some of the city's key areas.
Below is a breakdown of all the Opportunity Zones in Oklahoma City limits. Opportunity zones are based on census tracks. Oklahoma City combined some census tracks to create larger zones.
Central Business District
This zone incorporates downtown Oklahoma City and includes major employers such as OG&E Energy Corp., AT&T, Devon Energy Corporation and Continental. The target development for this zone would be Tier 1 jobs centers (company headquarters). Amenities like the new convention center, streetcar, First National redevelopment, American Indian Cultural Center and Boathouse District are strong catalyst for investment.
This zone offers a strong employment base and concentration of public investment with significant infill opportunities. Facilities like the Baker Hughes GE Research Center, OMRF, OU Medicine and the Oklahoma State Capitol are great asset anchors for the area. The target development for this zone would be Tier 1 jobs centers (headquarters for companies).
NE 23rd St Corridor
The strong assets for this zone are residential development and the Senior Wellness Center. This area has a high demand for services and is targeting residential and retail development.
Industrial development has potential here as the zone has great interstate access. Each day more than 146,000 cars travel this portion of the interstate.
I-35 & I-240
Another zone with industrial development potential. This zone is adjacent to the fastest-growing and highest-income zip codes on the south side of OKC. Businesses here have significant access to the I-35/I-240 interchange, large available buildings and access to the new BNSF Logistics Center.
This zone is served by rail and combines industrial and retail development. Each day, 84,000 cars travels this portion of I-40. Key anchors include the Oklahoma City Outlets, OKCWorks, Westgate Marketplace and its proximity to Will Rogers World Airport.
I-44 & I-235
This area is home to the Chesapeake Energy Corporation and is located near significant retail. The target job types for this zone are Tier 2 jobs centers.
This focus of this zone is tourism as it is home to Remington Park, Science Museum Oklahoma, USA Softball complex, OKC Zoo, The Cowboy & Western Heritage Museum and more.
Timing of an investment in these zones is crucial. Investors can defer tax on any prior gains invested in a Qualified Opportunity Fund (QOF) until the earlier of the date on which the investment in a QOF is sold or exchanged, or December 31, 2026. If the QOF investment is held for longer than 5 years, there is a 10% exclusion of the deferred gain. If held for more than 7 years, the 10% becomes 15%. Second, if the investor holds the investment in the Opportunity Fund for at least ten years, the investor is eligible for an increase in basis of the QOF investment equal to its fair market value on the date that the QOF investment is sold or exchanged.
For more information on Opportunity Zones in Oklahoma visit www.okcopportunityzones.com. To speak to someone directly call the Alliance for Economic Development of Oklahoma City at (405) 604-6780 or visit their website.