Opportunity zone projects are now in full swing. The opportunity zone model has been available for nearly two years, but investors were waiting the final regulations and guidance from the IRS. Then, the pandemic hit. Now that there is more understanding around both, opportunity zone projects are taking off.

"The delay was due to an abundance of caution from developers waiting for the final set of opportunity zone guidelines to be released before rushing to pour billions of dollars into projects," says Braden Crockett, VP and director at Matthews Real Estate Investment Services, tells GlobeSt.com. "While some of the smaller, private developers plunged into the deep end, your institutional investors, who write the big checks, have a significantly more strict, deliberative process before presenting opportunities to an investment committee."

The final guidance was crucial for most investors to move forward on opportunity zone investments. "Before the final round of guidance was released, there were still many questions outstanding, and boxes left unchecked that many fund managers would likely require in their development feasibility proforma's and processes, and rightfully so," says Crockett. "Because there were concerns that if the procedural items were mishandled, an entire project, underwriting substantial tax savings, could ultimately backfire. This not only amounts to losing favorable tax treatment but also creates a massive taxable event for investors, essentially voiding the entire investment thesis."