There’s a new notable name among those who plan big investments in Opportunity Zones – Anthony Scaramucci.
Scaramucci famously served as White House communications director last summer, before flaming out in just 10 days after giving a colorful interview in which he disparaged other Trump administration personnel.
Scaramucci came to the White House from Wall Street, where he ran an investment firm called SkyBridge Capital. After leaving the White House, Scaramucci returned to SkyBridge.
And now, Scaramucci and SkyBridge are planning to invest in Opportunity Zones, which are economically distressed areas designated by the Department of the Treasury for favorable tax rules for investors in exchange for investment.
Opportunity Zones were established by the Tax Cut and Jobs Act of 2017 and “designed to spur economic development and job creation by encouraging long-term investments in economically distressed communities nationwide.”
Earlier this year, the Treasury certified more than 8,700 communities nationwide as Opportunity Zones. According to the Treasury, approximately 35 million Americans live in areas designated as Opportunity Zones.
Through the program, investors reinvest their capital gains into areas that need investment. Gains can come from any investment, whether that is from stocks, bonds, real estate or partnership interests.
The areas have drawn a lot of investor interest already, and now SkyBridge is the latest to make a move.
SkyBridge is partnering with EJF Capital, a hedge fund and private equity fund manager, to launch of the SkyBridge-EJF Opportunity Zone Real Estate Investment Trust.
According to the firms, the REIT has a “mandate” to invest in Opportunity Zones.
“We launched the SkyBridge-EJF Opportunity Zone REIT in response to demand from investors, who correctly see the OZ program as a chance to potentially generate attractive returns while having a positive societal impact,” said Scaramucci, who is the founder and co-managing partner of SkyBridge Capital. “We worked with EJF to structure the product in an investor-friendly way to democratize access to this historic incentive.”
According to the firms, the investment vehicle is structured as a private, non-exchange-traded REIT that is available to accredited investors at a minimum investment of $100,000, and is expected to diversify its investments by geography, property type, and developer, while focusing on both new development and redevelopment real estate projects.
“Our team’s expertise in real estate and related investments, along with our relationships with regional and community banks, gives us an edge in sourcing and developing investment opportunities across multifamily, industrial, and hospitality,” said Neal Wilson, co-founder and chief operating officer of EJF Capital. “We partnered with SkyBridge on opportunity zones because they understand the needs of mass affluent investors.”
Scaramucci, as he is wont to do, took to Twitter to discuss the REIT’s unveiling and pushed back at suggestions that this effort or Opportunity Zones themselves are directly tied to his brief work from the Trump administration.
#OpportunityZones = bipartisan solution to drive capital into distressed American communities. Conceived during Obama admin, passed in Tax Cuts & Jobs Act of 2017. Co-written by liberal & conservative economists. Co-sponsored by Democrats & Republicans. Stop the politicization.
— Anthony Scaramucci (@Scaramucci) December 11, 2018
#OpportunityZones eligibility requirements are clear and regs are on right track. We have both urban and rural projects in the SkyBridge-EJF Opportunity Zone REIT, including one in small town with population of 2500 and only 700 jobs. https://t.co/ChbRxx60P4
— Anthony Scaramucci (@Scaramucci) December 11, 2018
