December 13, 2018 – Opportunity zones have become an attractive economic development tool to spur investment in distressed and economically challenged communities around the country. In response, the HBCU Community Development Action Coalition (CDAC) has launched the first HBCU-focused Opportunity Fund to ignite reinvestment in and around Historically Black Colleges and Universities (HBCU). The Renaissance HBCU Opportunity Fund aims to attract investment capital to help fund development of mixed-use projects on or near HBCU campuses in federally designated Opportunity Zones. The Fund has also been selected to receive support from the Kresge and Rockefeller Foundations through the Opportunity Zones Incubator, which will provide technical assistance to help bring the Fund to market.
“With nearly 50 percent of HBCUs located in Opportunity Zones, the HBCU CDAC sees this is an opportunity to position HBCU communities as investment hubs that will ultimately create jobs, stimulate small business activity, and create better economic opportunities within these communities,” shares Ron Butler, Chief Executive Officer of the HBCU CDAC. “With the support of the Kresge and Rockeller Foundations and in partnership with Renaissance Equity Partners, the Fund will be in a position to actively seek investment opportunities on or around HBCU campuses.”
The partnership between the HBCU CDC and Renaissance Equity Partners will pursue mixed-use projects that will attract business and create workforce housing opportunities targeted to junior faculty, staff, graduate students, and military veterans with GI Bill benefits. The Fund is particularly interested in mixed use projects that will attract supermarkets to food deserts designated by the U.S. Department of Agriculture as well as health care facilities to Medically Underserved Communities designated by the U.S. Department of Health and Human Services. The Fund also intends to structure each investment transaction in such a way that will allow the neighboring HBCU to share in the financial success of the project.
Opportunity Zones were created as part of the recently enacted Tax Cuts and Jobs Act of 2017. Its purpose is to encourage investment in underserved communities by providing significant federal tax incentives to investors who reinvest their unrealized capital gains into Opportunity Funds in federally designated Opportunity Zones. There are 8,700 designated zones across the country.
About the HBCU Community Development Action Coalition:
The HBCU CDAC promotes, supports, and advocates for historically black colleges and minority serving institutions (MSIs), community development corporations (CDCs), and the community economic development industry whose work creates wealth, builds healthy and sustainable communities, and achieves lasting economic viability. HBCU CDAC fulfills its mission of service to its members working in disinvested urban and rural communities through education, resource development, advocacy, networking, and training.
About Renaissance Equity Partners:
Renaissance Equity Partners is a real estate development finance advisory and private equity firm with a focus on emerging domestic communities. The Washington DC-based firm has long served as an economic development finance advisor to the HBCU CDAC.