Shopoff Realty Investments launched its first opportunity zone fund last month to capitalize the $545 million Dream Las Vegas hotel development in Las Vegas. The fund is a single-project venture, and it isn't necessarily the first of many for Shopoff. The firm is surveying other opportunity zone projects, but is focused on quality projects that pencil without the capital gains tax benefit.

"We have a number of funds currently that are for development projects, but this is the only QOZ fund as of now," Bill Shopoff, president and CEO, tells GlobeSt.com. "We are certainly open to future QOZ projects and funds, but that will depend on the opportunities we find."

Many opportunity zone projects rely on the tax benefit to make the deal pencil, and a frenzy around the investment model has inflated some deals. "For the most part, we have found QOZ land assets to be overpriced, driven up by the potential QOZ tax benefits, in inferior locations, or just not generally a good investment from a risk versus reward perspective," says Shopoff. "The quality of the investment, without tax considerations, drives our interest and underwriting. If we can find additional QOZ assets that meet our underwriting, exclusive of the potential tax benefits, then we would definitely consider another QOZ fund."