Land of Opportunity Zones

By Vijar Kohli

Golden Door Partners is the leading advisor when it comes to Opportunity Zone investing across America. Our team has spoken at dozens of conferences and has been working on the initiative since late 2017.

We came across these ‘Zones’ from our experiences in urban communities such as Newark, NJ and Baltimore, MD. With a minority background, our team can relate with the pain points in each of these communities. The lack of resources are apparent once you get on MLK boulevard.

These communities are undervalued and under-capitalized. For example, the West Ward of Newark is a food and health desert.

In this article, I want to discuss the mistakes when finding local service providers to help you make community investment decisions.

1.Find a service provider who has worked in the community before

Firms like KPMG and Deloitte have the macro down but lack the micro experience. Big firms charge a premium because they deliver premium service. No doubt about this.

The problem is Opportunity Zone investing is done at the micro level. Small businesses and individuals know best what problems exist in these communities. These Zones lack resources. Don’t expect a major player to all of a sudden become an expert in your local community. Start small.

One of the best service providers has been Novogradac, a mid-size accounting firm based in San Francisco. Novogradac has been leading the effort across the nation and created one of the first working groups in the industry. Their very impressive team recently released a handbook on Opportunity Zones.

2. The best firms are in it for the Long-Term

Verify. Too many people attempt to capitalize on buzzwords on hopes to identify greater fools. A wise man once said “a fool will soon part with his money.” Do your due diligence before engaging with anyone.

Chances are your local accountant and financial advisor are not educated on this piece. This handicaps your ability to execute. First, the legislation has not been finalized. No one is a true expert on the subject. Not even the legislators.

Many parties, including our firm, are still submitting commentary to work on several compliance issues when it comes to qualifying assets. If your service provider is not proactive with legislation, chances are you’re more educated on the topic than them.

This can work to your advantage if you are willing to do the hard work. If not, I recommend experienced firms who have been engaged with IRS commentary.

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