Investors yet to take advantage of program to help redevelop Friendship Court
CHARLOTTESVILLE, VA. (WVIR) - A unique program is trying to breathe new life into under-served communities throughout Virginia, but some areas are having a hard time finding investors.
Opportunity Zones are meant to bring better housing, grocery stores, and important services to low-income communities. The Friendship Court neighborhood is one of a handful of sites in the greater-Charlottesville area attempting to take part in the federal program.
"We're all still sort of scratching our heads a little bit, trying to see what the benefit is ultimately for the redevelopments that are underway," Piedmont Housing Alliance Executive Director Sunshine Mathon said.
Mathon says the program, which started in 2017, is just getting off the ground. Opportunity Zones provide a federal economic and community development tax benefit. This is available to investors with capital gains, and encourages long-term private investment in low-income areas.
"The services that have been historically missing from those communities: whether it's access to high-quality childcare, whether it's access to quality grocery stores, access to health clinics, services that have been under invested in those communities," Mathon explained.
Hundreds of these Opportunity Zones are peppered across the commonwealth, but only a handful of projects are actually underway, including ones in Harrisonburg and Staunton. So far, none have started in Charlottesville or Albemarle County.
“They are complicated. The guidance that the IRS has issued has been limited, and has been coming out over the past two years. So they're new, and people are trying to feel out how they're actually going to work," Charlottesville Director of Economic Development Chris Engle said.
The city partnered with Albemarle County last year to promote the zones with the hopes someone will step forward and invest.
"There is continued work in trying to find and pair investment opportunities with actual on-the-ground projects," Mathon said.
Phase one work at Friendship Court is expected to start in April or May. The Piedmont Housing Alliance says each phase of the project is slated to have one non-residential component, and it hopes the Opportunity Zone program will bring in an investor.
Copyright 2020 WVIR. All rights reserved.