Tampa, Florida, was nicknamed “The Big Guava” by a local newspaper columnist. The name was derived from New York’s Big Apple and a businessman’s unsuccessful quest to find wild guava trees for a tropical fruit packing firm in New York in the 1880’s. It turns out that Tampa was not a good place to grow guava, but New Yorkers have not stopped looking to Florida for real estate ever since. 

Tampa is, in fact, part of a much larger area most commonly referred to as the “Tampa Bay Area”. It’s also part of the Tampa – St. Petersburg-Clearwater Metropolitan Statistical Area. The city of Tampa has a population of roughly 393,000 people. In the late 1950s, the University of South Florida was established in North Tampa and the addition of the university prompted a lot of growth in construction both residential and commercial. Another city also part of the same Metropolitan Statistical Area and the 2nd largest city in the Tampa Bay Area is St Petersburg. St. Petersburg has an estimated 360 days of sunshine each year, which is why it’s commonly called “The Sunshine City”. St. Petersburg has a population of about 263,000 people. In terms of real estate trends, these markets have been sparking conversations. According to Tampa Bay Times, Tampa Bay is seeing similar trends as many other big markets. When you look at the third quarter of 2018, there was a year-over-year price increase of about 8 percent, and the Tampa Bay market is still outperforming many other similarly sized markets including Phoenix, Charlotte, Austin and Nashville. According to Norada Real Estate Tampa is also one of the most affordable in the state with an average home value of $221,500. 

According to Biz Journals, the daily commute from St. Petersburg to Tampa is an easy 24 minutes. Though the congestion seems to be an issue it still makes for a good place to move to while working in Tampa. There are a lot of areas that are also considered suburbs of the Tampa – St. Petersburg-Clearwater Metropolitan Statistical Area. Sharestates has taken a big interest in funding properties in these areas. Some areas that Sharestates has funded properties include New Port Richey,  Holiday, and of course St. Petersburg (also referred to as St. Petes). As reported by City of New Port Richey The City of New Port Richey is a suburb of Tampa, St. Petersburg and Clearwater and is considered part of the Tampa-St. Pete-Clearwater Metropolitan Statistical Area as well. Located on the west coast of Pasco County, the city has direct access to the Gulf of Mexico and Florida’s best beaches. Holiday, Florida is also located in Pasco County. 

This first property was acquired as part of a new development and after completion, the property will be listed for sale.

  • Loan Amount: $265,000
  • Loan Type: Purchase
  • Property Type: Residential
  • Rehab Budget: $80,000 
  • LTV: 75%
  • LTC: 46%
  • ARV: 66%

 

The next 3 properties were acquired as fix & flips. Rehab includes but is not limited to new roofs, kitchen cabinets, appliances, HVAC systems, new hot water heaters, windows, bathrooms and more.  Once rehab is complete on all properties they will be put on the market for sale.

  • Loan Amount: $88,000
  • Loan Type: Purchase
  • Property Type: Residential
  • Rehab Budget: $34,740 
  • LTV: 75%
  • LTC: 71%
  • ARV: 59%

 

  • Loan Amount: $176,000
  • Loan Type: Purchase
  • Property Type: Residential
  • Rehab Budget: $60,000 
  • LTV: 78%
  • LTC: 80%
  • ARV: 57%

 

  • Loan Amount: $172,000
  • Loan Type: Purchase
  • Property Type: Residential
  • Rehab Budget: $56,523 
  • LTV: 78%
  • LTC: 79%
  • ARV: 55%

 

 

For more information on properties we have funded or for more information about our loan programs click below.

In recent years, Austin, Texas has been hot for more reasons that just the weather. One of the biggest draws for tourists and residents alike to this unique city is the live music scene. This city is sometimes referred to as “The Live Music Capital of the World”. According to Forbes, Austin was recently voted as the No. 1 place to live in America for 3 years in a row based on affordability, job prospects and quality of life. Residents are also drawn to the many outdoor spaces and cultural institutions.  

Austin is the capital of Texas and also one of the fastest-growing large cities in the US with about 964,000 people and growing every year. The city is made up of an eclectic group of people which includes government employees, college students, musicians, high-tech workers, blue-collar workers, and a very vibrant LGBTQ community.

As one of the fastest-growing markets, there’s a lot of potential for investment opportunities. According to Norada Real Estate, Austin was recently ranked eighth among the best real estate markets, topping all other big Texas cities because the local economy is growing so rapidly, Austin’s housing market has also been booming since 2018. If you are a home buyer or real estate investor, Austin has a track record of being one of the best long term real estate investments in the U.S. Norada reported that the median home value averages $365,600, which has increased by 7.6% over the past 2 years and is predicted to rise 3.6% through 2020.  

Sharestates is now funding projects in this fast-growing market by starting relationships with borrowers and investors in the area. One of the properties Sharestates recently funded was located in the Walnut Place neighborhood. Walnut Place has a population of about 5,000. According to East Austin is Home, Walnut Place is an established neighborhood in East Austin, located within 15 minutes of downtown. The neighborhood has an almost rural feel to it. The borrower acquired this property as a “fix & flip” and once rehab is complete, the borrower will list the property for sale. Rehab consisted of new kitchen countertops and appliances, a new roof, a hot water tank, plumbing, air conditioning, landscaping and much more.

 

  • Loan Amount: $303,000
  • Loan Type: Purchase
  • Property Type: Residential
  • Rehab Budget: $67,200 
  • LTV: 72%
  • LTC: 84%
  • ARV: 68%

 

For more information on properties we have funded or for more information about our loan programs click below.

In June, the state legislature passed, and Governor Mario Cuomo signed, new legislation that changes the way rent can be increased, and other benefits for multifamily property owners, moving forward. Unfortunately, instead of these laws sunsetting after a number of years, the new legislation has made them permanent.

The largest percentage of rental units in New York City, 44 percent, are rent-stabilized while only 1 percent are rent-controlled. These are the homes that were the primary target of the regulation and which will be most affected by it.

 What Are The Major Rent Control Reforms?

While the new legislation didn’t go as far as many advocates were hoping for, there are some pretty strict hand-ties for landlords. The legislation did not do away with the major capital improvements loophole, but it does narrow the scope of definition for major capital improvements and limits how much landlords can raise rents to compensate for them to just two percent. This provision of the law will be in effect for the next 30 years.

In addition, the legislation puts an end to the 20 percent vacancy bonus landlords can raise rents by for new tenants when they move in. Landlords can also no longer raise rent from the preferential rent to market rate when tenants renew their leases. Landlords are further capped on how much they can spend on individual apartment improvements. Not only that, but the jurisdiction for the law has been expanded to include Westchester, Rockland, and Nassau counties.

How Might These Reforms Affect Multifamily Development in the Years to Come?

There are two major areas of multifamily development likely to be affected by these rent reforms. The first is the new construction sector. The second is capital improvements.

While many of the laws in the reform are targeted toward landlords who currently manage rental units, that doesn’t mean new construction won’t be affected. It costs money to build apartment complexes. Landlords rely on tenant rents and rent increases to pay for that development. While it could be a number of years before capital improvements are necessary on new developments, the cost of materials and labor will continue to climb. So developers will have to factor in the rising costs of construction and weigh it against flat rent increases. If the math doesn’t work out, in the long run, we will likely see new construction of multifamily developments decrease once market forces for labor and materials no longer make it profitable to build.

On the capital improvements side, landlords will be reluctant to improve apartment complexes if they can’t recoup the costs by raising tenant rents. On the other hand, certain maintenance costs cannot be avoided. This will become a major balancing act for landlords for the next three decades, particularly for landlords of older buildings.

For older complexes where rents are maximized, what could happen is landlords may decide to replace older buildings with new construction, which would allow them to effectively run older tenants out of the building and charge new tenants in new buildings higher rent. The “good cause” law was not included in the new legislation. This clause would prohibit evictions except for good cause. If it becomes too financially restrictive and costly to manage older apartment complexes, landlords may not have another way out other than to replace older buildings with newer constructions.

Rent reform advocates are disappointed the law didn’t go far enough. From a landlord perspective, it’s going to be difficult to manage the regulation financially and could hand strap many landlords in New York City and surrounding counties.

Dallas is the third-largest city in Texas, better known as the Lone Star State, and is considered a modern metropolis located in the northern part of the state. Dallas is also the ninth-largest city in the US with a population of 1.3 million people. It’s broken up into specific neighborhoods known as Central Dallas, East Dallas, and South Dallas.

According to Real Wealth Network Dallas has become a very popular place to invest in buy and hold real estate, which is especially true for investors looking to purchase cash-flowing properties in a rapidly growing market. The median home value in the Dallas/Fort Worth area is about $242,900. According to Zillow home values have grown 5.6% over the past year and Zillow predicts they will rise another 2% over the next year. Another reason the market is healthy and growing is that the job market is growing as well. Department of Numbers reports there are close to 4M jobs available, and in June Dallas added 17,500 jobs according to the CES survey. CES employment records show that jobs are increasing monthly which is great news for the local economy.

Sharestates has been forging new relationships with borrowers in the Dallas metro area and recently funded a few noteworthy projects. Both properties showcased here are residential properties located in the Little Forest Hills neighborhood, which is about 4 miles east of downtown Dallas and has a median home value of $267,996. According to D Magazine, the eclectic mix of both people and houses is its hallmark, but it’s ready proximity to the many attractions of White Rock Lake makes this location hard to beat. For both properties, the borrower had previously acquired and has approved plans to convert the property into additional residential units and square footage. Rehab will consist of new electrical, custom windows & doors, new plumbing, flooring, appliances, carpeting and more. The borrower intends to complete the build-out and either sell at completion/stabilization or refinance into a conventional loan.

 

  • Loan Amount: $401,000
  • Loan Type: Purchase
  • Property Type: Residential
  • Rehab Budget: $421,621 
  • LTV: 50%
  • LTC: 65%
  • ARV: 65%

  • Loan Amount: $364,000
  • Loan Type: Purchase
  • Property Type: Residential
  • Rehab Budget: $322,220
  • LTV: 50%
  • LTC: 70%
  • ARV: 65%

 

For more information on properties we have funded or for more information about our loan programs click below.

Charlotte, North Carolina has culture, food, entertainment, and is considered to have some of the friendliest people in the country. In 2018 there was a population of 2,569,213 and was ranked 23rd in the U.S. most populated cities. Charlotte is the home of the Nascar Hall of Fame, Charlotte Motor Speedway, and the 7th Street Public Market which is a market full of home-grown produce. According to US News  at this indoor marketplace, you’ll find a selection of local produce, wines, flowers, and sweet and/or savory treats. Among the vendors selling their local goods is one of the city’s favorite pizza joint, Pure Pizza, known for using ingredients sold right in the market. Also if you stop by in the morning, instead of your usual Starbucks coffee trade it in for the freshly brewed coffee available at Not Just Coffee. Charlotte is also known as a millennial hub, meaning a lot of young people and young families are moving there due to the lower cost of living and a strong job market.

But let’s talk about Charlotte’s real estate trends. According to Zillow, the median home value will rise by 6.1% over the next 12 months which leads us into 2020. Right now the median home value is about $226,000 which is average for the U.S. There has always been a large correlation between job opportunities and booming housing markets. When a city sees that their unemployment rate dropping they also see a drop in housing inventory. Charlotte is a major banking and financial hub. It’s the corporate headquarters for Bank of America and U.S. Trust but also headquarters for companies like Lowes, Family Dollar, and Hanes Brands. This market has seen its unemployment rate drop to 3.4% according to Home Buying Institute, which is a huge difference from the peak in 2010 during the recession when it was 12.9%. This is a big reason a lot of people are looking to Charlotte as their new home base. 

Since Charlotte is a market that is on the real estate rise, Sharestates has taken a big interest there. We recently funded a blanket loan with 10 separate townhomes in the Wessex Square neighborhood in South Charlotte. Wessex Square is in Mecklenburg County and is one of the best places to live in North Carolina. The borrower previously acquired the property as land and then constructed residential townhomes that are now complete and listed for sale by unit. Two loans were taken to fund this property totaling $5,090,000.

  • First loan – 
  • Loan Amount: $2,670,000
  • Loan Type: Refinance 
  • Property Type: Residential 
  • LTV: 70%

 

  • Second Loan –
  • Loan Amount: $2,420,000
  • Loan Type: Refinance
  • Property Type: Residential 
  • LTV: 71%

For more information on loans Sharestates has funded or for more information about our loan programs click below.

Did you know that a Cleveland DJ by the name of Alan Freed was the first person to coin the term rock and roll? It should come as no surprise then that this city, located on the southern shore of Lake Erie, about 60 miles west of the Pennsylvania border, is the home to the famous Rock & Roll Hall of Fame. It’s also home to the world-renowned Cleveland Clinic and Cleveland Orchestra. But it’s Cleveland’s real estate market that is just as interesting as its famous institutions which has our attention.

According to Norada Real Estate in 2018, a forecast for the Cleveland, Ohio housing market suggested that home-price appreciation could begin to slow down, following a year of double-digit gains. Home prices in Cleveland rose steadily and significantly during 2017, and they were expected to continue trending north for the foreseeable future. According to Realtor.com the median list price of homes in Cleveland, OH was $124.9K, trending up 8.6% year-over-year. Downtown Cleveland has also experienced a surge in real estate development over the past 10 years, with an estimated $19 billion in development completed or planned since 2010.

Sharestates made a commitment to funding loans in Cleveland and we have been aggressively forging new relationships there. Here are a  few properties that we’ve funded there to date.

This first property is located in a neighborhood called Ohio City. Ohio City is a trendy area with loads of high-end cocktail bars and beer gardens. Though Ohio City is one of the oldest neighborhoods in Cleveland it has some of the most fashionable and chic bistros, shops, and galleries. This neighborhood has a very urban feel made up of young families and your professionals. The property is a multi-family building with 8 units. The borrower previously acquired the property and will begin rehabilitation. The borrower intends to complete the rehab plans and stabilize the investment. Rehab includes demolition and installation of new kitchens, new plumbing/electrically, new insulation, drywall, and more.

  • Loan Amount: $530,000
  • Rehab Budget: $532,000
  • Property Type: Multi-Family
  • Loan Type: Refinance
  • ARV: 67%
  • LTV: 70%

The next property is located in Downtown Cleveland which is known for Q Arena – Home of the Cleveland Cavaliers, Progressive Field – Home of the Cleveland Indians and The Rock and Roll Hall of Fame, which is home to countless famous instruments played by famous bands and musicians. This property is a mixed-use building with 21 residential & 2 commercial units. The property will be leased out after conversion is complete. Rehab will include demolition, new windows, new kitchens in all units, new bathrooms in all units, plumbing/electrical work and a new HVAC system.

 

 

 

 

  • Loan Amount: $788,000
  • Rehab Budget: $155,610
  • Property Type: Mixed-Use
  • Loan Type: Purchase
  • LTV: 75%
  • ARV: 56%
  • LTC: 80%

The final property is located in a neighborhood called Kamm’s Corners. This neighborhood is located on the west side of Cleveland along the Rocky River. This neighborhood is very family friendly with a suburban feel. Kamm’s Corner, also known as West Park, is full of authentic Irish pubs, hobby shops, and seasonal farmer’s markets. The property is a four-story multi-family apartment building featuring 28 residential units. The borrower is acquiring this property with intentions of adding value by rehabilitation. Rehab will consist of cosmetic updates to all units and plumbing/electrical will be updated. When rehab is complete, the units will be leased out to new tenants.

  • Loan Amount: $845,000
  • Rehab Fund: $166,500
  • Property Type: Multi-Family
  • Loan Type: Purchase
  • LTV: 75%
  • ARV: 66%
  • LTC: 72%

 

For more information on loans Sharestates has funded or for more information about our loan programs click below.

Detroit is a city that goes by many different names: Motor City and Motown just to name a few. Detroit is one of those cities that has a little bit for everyone. There are the obvious car buffs but there also are some art museums, great music venues, lots of history, great sports teams, and of course nightlife. Detroit is also a major port located on the Detroit River and is the second largest regional economy in the midwest behind Chicago.

The real estate market is interesting as well. According to Fortune Builders, Detroit may serve as a testament to the strength of the United States economy. No more than a year ago, Detroit represented a city in decline for the better part of a half a century. However, having made significant improvements over the course of a year, Detroit is positioned to make a remarkable economic resurgence.

For Sharestates Detroit is a market we also see some great potential and are working to forge relationships with borrowers to help build the city back up. One property we funded is located in a neighborhood called Poletown East. The name came from immigrants who originally lived there. Poletown is sometimes used inclusively as slang for Hamtramck, Michigan, probably due to Hamtramck’s strong identification with Polish-Americans. The property is a multifamily property with 24 units. The borrower previously acquired the subject property and is refinancing to obtain construction financing to begin build-out. The borrower intends to complete the build-out and either sell at completion/stabilization or refinance into a conventional loan. Rehab on this property will include demolition, roofing, flooring, new HVAC system, all new plumbing/electrical, new installation of elevators, drywall and much more.

Loan Amount: $2,344,000

Rehab Budget: $2,753,457

LTV: 75%

ARV: 59%

Another property Sharestates recently funded is located in the East Grand Boulevard Historic District. This area includes a few moderate-sized apartment buildings and numerous large homes. During the late 19th century, creating wide, graceful streets was seen as a way to create a beautiful city and this area adopted that feel. Living in this area was considered prestigious at that time. East Grand Boulevard is a thoroughfare in Detroit, running east to west in some parts and north to south in others. The property is a residential multifamily property with 2 units. The borrower previously acquired the subject property and will begin rehab. The borrower intends to complete the rehab plans and market the property for sale. Rehab will consist of cabinetry, drywall, heating/cooling, plumbing/electrical, new hardwood floors, bathroom tiles/shower doors, and new rear porch to name a few.

Loan Amount: $417,000

Rehab Budget: $200,900

LTV: 75%

ARV: 70%

 

To learn more about Sharestates or to apply for a loan to fund your next real estate project click below.

Isabel Marant said it best, “In Los Angeles, you can have the city life but feel like you’re on vacation at the same time”. When I lived in LA I would drive by the beach on my way to work and think to myself, this is paradise. You can stand on the beach in Santa Monica while looking at the snow on the mountain tops in the distance. LA is the most populated city in California and the second most populated city in the country after New York City. LA has so many landmarks that people come from all over to visit: the Hollywood sign, The Capitol Records Building, Grauman’s Chinese Theatre, Griffith Observatory, Hollywood Boulevard, and so many more. LA is also known as the entertainment capital of the world and a place that is known to the world is the Hollywood Walk of Fame where a reported 10 million tourists visit each year.

But let’s talk about the real estate market in LA. As a private lender, LA is a market that gets us very excited. The California housing market is one of the hottest and most profitable in the United States and the Los Angeles housing market is considered to be one of the premier housing markets for investors. While Los Angeles home prices may be increasing slightly over the next year or so, the fact remains that there are many homes available at fair prices. According to LA.cubed.com typical home prices in LA are about 8 times higher than the median income. According to Zillow.com, the median home value is $687,700 which has gone up 2.7% over the past year.

Since LA is such a hot market for real estate, Sharestates has taken a big interest in forming relationships there. Here are a few projects that we have recently funded.

This first property is located in Encino, California. Encino is a neighborhood that is located in the San Fernando Valley region of LA. The median household income is $78,529 and the average household size is 2.3 people. The neighborhood is filled with quiet blocks and big homes but also has apartment building clusters here and there. Encino is considered to be an upper-middle-class historic neighborhood. Residents love its small-town feel with amenities within walking distance. This property is a residential property where the borrower acquired funds for renovations, such as replacing the cabinets in kitchen and bathroom, relocation of all plumbing/gas fixtures, and updates to the existing structure.

Loan Amount: $1,950,000

Loan Type: Refinance

Property Type: Residential

 

The second property is located in Central LA, close to Hollywood. There are so many great advantages to living in this area. From walking through Hollywood to a short drive to Dodgers Stadium for some baseball to heading to The Grove for the afternoon to get some shopping done. The list of things to do is endless. This property is an 8 unit multi-family property that the borrower acquired with the intention of adding value through renovations. This large project includes adding two additional units making a total of ten units. New stainless steel appliances will be added, all new paint, new bathrooms, central air conditioning, and each unit will receive a washer/dryer.  

Loan Amount: $1,463,000

Loan Type: Purchase

Rehab Fund: $218,285

 

 

The last property showcased here today is a residential property located in the neighborhood of Westchester. This neighborhood is close to the beach towns such as Santa Monica and Venice beach on one side of LAX (Los Angeles International Airport) and Manhattan Beach and Hermosa Beach on the other side. This home is only about 2 miles from LAX. The borrower acquired this property as a “Fix & Flip”.  Rehab will consist of a complete overhaul of the property starting with the foundation all the way to new plumbing, a new HVAC system, new appliances, new roofing, adding in a gas fireplace, windows, flooring, tile, and hardware like cabinets and doors.

Loan Amount: $920,000

Loan Type: Purchase

Rehab Funds: $609,450

 

 

 

 

 

 

To see more of Sharestates recently funded projects or find out how to get funding for your next real estate project click below.

When someone mentions The Bronx they usually think of Yankee Stadium, the Bronx Zoo or the Botanical Gardens because they are all popular tourist destinations. When it comes to real estate opportunities, this borough has had a much lower profile than its famous neighboring borough, Manhattan. Since the late 1980’s, however, there has been a significant amount of development which was first brought on by the city’s “Ten-Year Housing Plan”. In 2006, The New York Times reported that “construction cranes have become the borough’s new visual metaphor, replacing the window decals of the 1980s in which pictures of potted plants and drawn curtains were placed in the windows of abandoned buildings. In addition, there is a revitalization of the existing housing market in areas such as Hunts Point, the Lower Concourse, and the neighborhoods surrounding the Third Avenue Bridge as people have been buying apartments and renovating them. There are also several boutique and chain hotels that have opened in recent years.

According to some reports, several Bronx neighborhoods saw double-digit price increases in 2017. Some of those who have been priced out of Manhattan and Brooklyn have increasingly looked for homes in The Bronx due to the easy accessibility to Manhattan. According to Property Shark the elevated housing demand in the neighborhoods around the boulevard pushed the median home sale price to increase 68% in just 5 years—from 2014 to 2018. The housing market near the Grand Concourse has surged in the past 5 years, including neighborhoods such as Mott Haven and Bedford Park. Concourse Village has an authentic NYC feel to it, with plenty of bars, restaurants, coffee shops, and parks. The crime rate has dropped over the years, and public schools in the neighborhood have an above-average rating.

Sharestates has been busy funding loans in The Bronx and formed many great relationships there. One such recently funded property was a multifamily building located in the South Bronx neighborhood Mott Haven. Mott Haven is primarily a residential neighborhood that has been undergoing a gradual reinvention, with restaurants opening and people coming in and rehabilitating buildings and/or building new ones. The borrower is planning on doing rehab work to add value. Rehab includes a complete overhaul including but not limited to new structural work, new HVAC system, all new electrical systems, iron & steel work, all new drywall, and new plumbing. When rehab is complete the property and or units will be leased out to tenants.

  • Loan Amount – $3,235,000
  • Rehab Budget – $2,250,000
  • Loan Type – Purchase
  • Purchase Price – $2,100,000

Another recently funded property was a multifamily property located in the Wakefield section of the Bronx. Wakefield is a middle-class section of the northern part of the borough and borders Westchester County to the north. Though Wakefield is about an hour commute via public transportation, it has a bit of a suburban feel to it which is attractive to its residents. The borrower has approved plans to convert the property into additional residential units and add square footage. With plans to rehabilitate this property, there will be a new plumbing system put in, electrical, windows, and repairs on elevators and much more. The borrower plans on selling the property once the project is complete.

  • Loan amount – $4,945,000
  • Rehab Budget – $2,510,000
  • Loan Type – Refinance

The last recently funded project we’ll highlight was a residential property located in the East Tremont neighborhood of the Bronx. East Tremont is in the western part of the borough and is also a very urban neighborhood made up of mostly apartment complexes and high rise apartment buildings. Commuting to midtown Manhattan can be done by way of the subway or Metro-North railroad. The borrower plans on doing rehab work to increase the value of the property and then stabilize the investment.

  • Loan Amount – $542,000
  • Property Type – Residential
  • Loan Type – Refinance

 

To see more loans that Sharestates has funded in the Bronx or inquire about funding your next loan click below.

An opportunity zone is a federally designated low-income area targeted for investment in order to revitalize the communities and kick start the economy. Real estate developers are offered tax incentives for reinvesting capital gains into these zones. Recently, LOCUS published a report ranking the top opportunity zones in the U.S. But what does this ranking mean for real estate developers?

An Overview of Opportunity Zones

There are currently more than 8,700 opportunity zones in the continental U.S., district of columbia, and U.S. territories. The LOCUS National Opportunity Zone Ranking Report compares these zones against three primary metrics – Smart Growth Potential, social equity, and a Vulnerability Index score (SEVI).

Smart Growth Potential is a proprietary filter to help investors identify which opportunity zones take priority based on their potential to deliver economic, environmental, and social returns. This filter rests on four identifiable metrics: Walkability, job density, housing diversity, and distance to the nearest top 100 central business district (CBD). Scores range from a minimum of 10 to a maximum of 20. For social equity and SEVI, LOCUS used four variables: transit accessibility, housing, and transportation affordability, diversity of housing tenure, and the Social Vulnerability Index. Again, the minimum score is 10.

Using these metrics and the scoring algorithm, LOCUS made some interesting discoveries. Only 2% of the opportunity zones scored a 10 or higher on these metrics, 13% of the opportunity zones with Smart Growth Potential less than a score of 10 are in rural areas, and only .18% of Americans live in both a high opportunity and a high equity opportunity zone (i.e. they are walkable urban places and socially and economically inclusive).

Where are the Top U.S. Opportunity Zones Located?

According to the report, the top scores for opportunity zones among the top 30 metro areas with the most Smart Growth Potential are New York, Los Angeles, Philadelphia, and Chicago. Charlotte, San Antonio, Orlando, and Dallas received the lowest scores. The states with the highest scores include New York, California, Maryland, New Jersey, Pennsylvania, and Ohio.

According to the report, the top scores for opportunity zones among the top 30 metro areas with the most Smart Growth Potential are New York, Los Angeles, Philadelphia, and Chicago. Charlotte, San Antonio, Orlando, and Dallas received the lowest scores. The states with the highest scores include New York, California, Maryland, New Jersey, Pennsylvania, and Ohio.

The top 11 opportunity zones based on Smart Growth Potential are:

  1. Downtown Portland (CBD) – Census FIPS 41051010600
  2. Downtown Oakland
  3. Downtown Seattle
  4. Center City East in Philadelphia
  5. Inner Harbor of Baltimore
  6. Downtown Newark
  7. Downtown Portland (CBD) – Census FIPS 41051005100
  8. Downtown Detroit
  9. Journal Square in New York
  10. Downtown St. Paul
  11. Wilshire Central BID in Los Angeles

The top 10 social equity and vulnerable places with high Smart Growth Potential include:

  1. Downtown Portland (CBD)
  2. Downtown Oakland
  3. Downtown Seattle
  4. Downtown Newark
  5. International District in Seattle
  6. Downtown Sacramento
  7. Wilshire Central BID in Los Angeles
  8. Westlake in Los Angeles
  9. Campus District in Cleveland
  10. Downtown Honolulu

Top U.S. Opportunity Zones by Product Type

Product types make a difference too. New York, for instance, scored high among offices asking for rent, multifamily properties asking for rent, and retail space asking for rent. Other notable high scorers among office space include Hollywood, San Francisco Bay Area, Miami, and Seattle. Among multifamily properties, Cleveland’s Campus District, various Los Angeles neighborhoods, San Francisco, and Seattle scored high. Rounding out the top five in retail are Miami, San Francisco, Los Angeles, and Seattle.

Top opportunity zones across all product include Hudson Yards/Hell’s Kitchen in Manhattan, East Village in Manhattan, Kips Bay in Manhattan, Williamsburg in Brooklyn, Greater Flushing Queens, Brooklyn Heights, East Harlem, Central Harlem, Downtown Brooklyn, and Williamsburg South in Brooklyn.

The Four Opportunity Zone Quadrants

When scoring, LOCUS categorizes each opportunity zone as either high or low equity and either high or low opportunity, based on their scores in the associated metrics. In that regard, each opportunity may be considered to fall into one of the following four quadrants:

  1. High Equity / Low Opportunity
  2. High Opportunity / High Equity
  3. Low Equity / Low Opportunity
  4. High Opportunity / High Equity

The report contains a lot of detail on each opportunity zone with each of the metrics analyzed for each opportunity zone. It’s a great read, and developers looking for opportunity zones to invest in would do well to check it out.

An opportunity zone is a federally designated low-income area targeted for investment in order to revitalize the communities and kick start the economy. Real estate developers are offered tax incentives for reinvesting capital gains into these zones. Recently, LOCUS published a report ranking the top opportunity zones in the U.S. But what does this ranking mean for real estate developers?

An Overview of Opportunity Zones

There are currently more than 8,700 opportunity zones in the continental U.S., district of columbia, and U.S. territories. The LOCUS National Opportunity Zone Ranking Report compares these zones against three primary metrics – Smart Growth Potential, social equity, and a Vulnerability Index score (SEVI).

Smart Growth Potential is a proprietary filter to help investors identify which opportunity zones take priority based on their potential to deliver economic, environmental, and social returns. This filter rests on four identifiable metrics: Walkability, job density, housing diversity, and distance to the nearest top 100 central business district (CBD). Scores range from a minimum of 10 to a maximum of 20. For social equity and SEVI, LOCUS used four variables: transit accessibility, housing, and transportation affordability, diversity of housing tenure, and the Social Vulnerability Index. Again, the minimum score is 10.

Using these metrics and the scoring algorithm, LOCUS made some interesting discoveries. Only 2% of the opportunity zones scored a 10 or higher on these metrics, 13% of the opportunity zones with Smart Growth Potential less than a score of 10 are in rural areas, and only .18% of Americans live in both a high opportunity and a high equity opportunity zone (i.e. they are walkable urban places and socially and economically inclusive).

Where are the Top U.S. Opportunity Zones Located?

According to the report, the top scores for opportunity zones among the top 30 metro areas with the most Smart Growth Potential are New York, Los Angeles, Philadelphia, and Chicago. Charlotte, San Antonio, Orlando, and Dallas received the lowest scores. The states with the highest scores include New York, California, Maryland, New Jersey, Pennsylvania, and Ohio.

According to the report, the top scores for opportunity zones among the top 30 metro areas with the most Smart Growth Potential are New York, Los Angeles, Philadelphia, and Chicago. Charlotte, San Antonio, Orlando, and Dallas received the lowest scores. The states with the highest scores include New York, California, Maryland, New Jersey, Pennsylvania, and Ohio.

The top 11 opportunity zones based on Smart Growth Potential are:

  1. Downtown Portland (CBD) – Census FIPS 41051010600
  2. Downtown Oakland
  3. Downtown Seattle
  4. Center City East in Philadelphia
  5. Inner Harbor of Baltimore
  6. Downtown Newark
  7. Downtown Portland (CBD) – Census FIPS 41051005100
  8. Downtown Detroit
  9. Journal Square in New York
  10. Downtown St. Paul
  11. Wilshire Central BID in Los Angeles

The top 10 social equity and vulnerable places with high Smart Growth Potential include:

  1. Downtown Portland (CBD)
  2. Downtown Oakland
  3. Downtown Seattle
  4. Downtown Newark
  5. International District in Seattle
  6. Downtown Sacramento
  7. Wilshire Central BID in Los Angeles
  8. Westlake in Los Angeles
  9. Campus District in Cleveland
  10. Downtown Honolulu

Top U.S. Opportunity Zones by Product Type

Product types make a difference too. New York, for instance, scored high among offices asking for rent, multifamily properties asking for rent, and retail space asking for rent. Other notable high scorers among office space include Hollywood, San Francisco Bay Area, Miami, and Seattle. Among multifamily properties, Cleveland’s Campus District, various Los Angeles neighborhoods, San Francisco, and Seattle scored high. Rounding out the top five in retail are Miami, San Francisco, Los Angeles, and Seattle.

Top opportunity zones across all product include Hudson Yards/Hell’s Kitchen in Manhattan, East Village in Manhattan, Kips Bay in Manhattan, Williamsburg in Brooklyn, Greater Flushing Queens, Brooklyn Heights, East Harlem, Central Harlem, Downtown Brooklyn, and Williamsburg South in Brooklyn.

The Four Opportunity Zone Quadrants

When scoring, LOCUS categorizes each opportunity zone as either high or low equity and either high or low opportunity, based on their scores in the associated metrics. In that regard, each opportunity may be considered to fall into one of the following four quadrants:

  1. High Equity / Low Opportunity
  2. High Opportunity / High Equity
  3. Low Equity / Low Opportunity
  4. High Opportunity / High Equity

The report contains a lot of detail on each opportunity zone with each of the metrics analyzed for each opportunity zone. It’s a great read, and developers looking for opportunity zones to invest in would do well to check it out.