Jimmy Atkinson of OpportunityDb Visits Urban Catalyst
by Erik Hayden, on Sep 13, 2021 3:41:20 PM
In the world of Opportunity Zone Funds, Jimmy Atkinson is somewhat of a rock star. Jimmy runs OpportunityDb, a popular website focused solely on the Opportunity Zone Program. He reports news, hosts his popular podcasts, and sponsors pitch days--all focused on the Qualified Opportunity Zone Program.
Jimmy recently visited the Urban Catalyst team at our San Jose headquarters, and I had the pleasure of taking him on a tour of some of the sites key to our organization.
We started at the downtown site where we plan to build our Fund II projects, Icon and Echo. The two developments, caddy-corner from City Hall, will bring to the downtown core new multifamily and office space.
After a short walk, we arrived at San Jose State University, near the location of our planned student housing, The Mark. The Mark is one of six projects in our Fund I, which closed in December after raising $131 million.
Our last stop was at the site of Google’s future mega-campus, which is near a few of our other Fund I project sites. The Google development is expected to cause a huge ripple effect in the local economy, and Urban Catalyst plans to be among the beneficiaries.
- 0:47—Erik explains his enthusiasm for downtown San Jose’s future
- 1:47—We visit Adobe headquarters, next door to Urban Catalyst offices, and discuss Adobe’s new construction and other surrounding projects
- 2:57--Erik and I visit the site of the future Fund II Icon/Echo development and discuss the projects
- 6:10--We visit San Jose State University and discuss the role it plays in downtown San Jose, and we discuss The Mark project, which will bring nearby student housing
- 7:32—Erik and I visit the nearby site of Google’s future mega-campus and discuss its anticipated impact on San Jose’s growth
- 8:26—We discuss the projected impact of the Google development for investors in Urban Catalyst’s Opportunity Zone Fund.
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Real Estate Risk Disclosure:
- There is no guarantee that any strategy will be successful or achieve investment objectives including, among other things, profits, distributions, tax benefits, exit strategy, etc.;
- Potential for property value loss – All real estate investments have the potential to lose value during the life of the investments;
- Change of tax status – The income stream and depreciation schedule for any investment property may affect the property owner’s income bracket and/or tax status. An unfavorable tax ruling may cancel deferral of capital gains and result in immediate tax liabilities;
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Opportunity Zone Disclosures
- Investing in opportunity zones is speculative. Opportunity zones are newly formed entities with no operating history. There is no assurance of investment return, property appreciation, or profits. The ability to resell the fund’s underlying investment properties or businesses is not guaranteed. Investing in opportunity zone funds may involve a higher level of risk than investing in other established real estate offerings.
- Long-term investment. Opportunity zone funds have illiquid underlying investments that may not be easy to sell and the return of capital and realization of gains, if any, from an investment will generally occur only upon the partial or complete disposition or refinancing of such investments.
- Limited secondary market for redemption. Although secondary markets may provide a liquidity option in limited circumstances, the amount you will receive typically is discounted to current valuations.
- Difficult valuation assessment. The portfolio holdings in opportunity zone funds may be difficult to value because financial markets or exchanges do not usually quote or trade the holdings. As such, market prices for most of a fund’s holdings will not be readily available.
- Capital call default consequences. Meeting capital calls to provide managers with the pledged capital is a contractual obligation of each investor. Failure to meet this requirement in a timely manner could elicit significant adverse consequences, including, without limitation, the forfeiture of your interest in the fund.
- Opportunity zone funds may use leverage in connection with certain investments or participate in investments with highly leveraged capital structures. Leverage involves a high degree of financial risk and may increase the exposure of such investments to factors such as rising interest rates, downturns in the economy or deterioration in the condition of the assets underlying such investments.
- Unregistered investment. As with other unregistered investments, the regulatory protections of the Investment Company Act of 1940 are not available with unregistered securities.
- It is possible, due to tax, regulatory, or investment decisions, that a fund, or its investors, are unable realize any tax benefits. You should evaluate the merits of the underlying investment and not solely invest in an opportunity zone fund for any potential tax advantage.