EJF Capital Bets on $86M Jacksonville Opportunity Zone Project
The alternative asset manager has joined forces with Chance Partners on the 486-unit community in the city's San Marco neighborhood, adding to a string of deals in tax-friendly areas.
Alternative asset manager EJF Capital is adding to a slew of Opportunity Zone deals by teaming up with Southeastern developer Chance Partners on a roughly $86 million multifamily project in Jacksonville, Fla. The two-building, 486-unit community in the San Marco neighborhood is expected to break ground in the third quarter of this year, with opening scheduled for the fourth quarter of 2020. Ameris Bank, joined by Stifel Bank, is providing a $51 million loan.
The project, San Marco Crossing, is being developed on three parcels totaling nearly 9 acres within a designated federal Opportunity Zone, one of the thousands of neighborhoods nationwide that offer tax incentives to stimulate economic growth. EJF, which manages about $7.5 billion in assets, formed a new fund to take advantage of the program last year, and the Jacksonville project marks the vehicle’s fourth Opportunity Zone bet.
Investing in an infill neighborhood
Located along the west side of Philips Highway between Olevia Street and Mitchell Avenue, San Marco Crossing is expected to be home to about 700 residents. Live Oak Contracting has been tapped to build the project as general contractor with completion slated for 2021.
The historic infill neighborhood on the east bank of the St. Johns River is located two miles south of downtown Jacksonville and nearby the healthcare complexes of Southbank. In a statement, EJF touted the benefits to the community of the spending power of the new residents as well as the high-quality construction jobs the project will create.
Formed last year, the EJF OpZone Fund I LP has a targeted capital raise of $300 million to $500 million. EJF hired former Kettler Inc. executive Asheel Shah to head up the new Opportunity Zone strategy. In May of this year, the company partnered with Donatelli Development and Blue Skye Development to develop a 262-unit Opportunity Zone community in Washington, D.C.