Stonehenge Capital Co. is working to raise $50 million from investors for an Opportunity Zone fund, placing Richard Allen as its new director of strategic initiatives tasked with overseeing its Opportunity Zone projects. 

Stonehenge Capital, with an executive presence in Baton Rouge and corporate offices in Columbus, Ohio, previously told federal regulators it raised $81.5 million as a pooled investment fund in 2016 dubbed as an Opportunity Zone fund which it said Wednesday is unrelated to the current effort. 

Stonehenge Capital expects to continue evaluating potential investment projects in the same vein as its experience over the past two decades of mostly renovation of historic buildings in the urban cores of large cities and small towns across the U.S.

"We're in the process of reviewing eligible transactions," Allen, a New Orleans resident, said of potential investments from the new Opportunity Zone fund.

One key factor in the decision process is how much community impact there may be.

"It's critical that the projects would not be able to go forward but for the availability of Opportunity Zone financing," said Allen, who is expected to work out of the company's New Orleans office. 

Allen was a vice president at HRI Properties, a national real estate firm revitalizing properties using federal, state and local incentives. During his 12 years at HRI, he was responsible for managing, underwriting and closing multiple large-scale hospitality, multifamily and mixed-use developments across the United States, with total development costs in excess of $1 billion.

Some Opportunity Zone projects may end up being financed through Stonehenge Capital's fund in Louisiana but it's early in the process, he said. 

Stonehenge Capital was founded in 1999 when it spun out of Bank One, which was acquired by JPMorgan Chase & Co. The investment company has already raised and spent more than $400 million for economic development projects and business financing since its inception. Stonehenge has leveraged New Market Tax Credits for years for renovations.

Stonehenge President Tom Adamek has been bullish on Opportunity Zones and suggested to a business crowd in Dallas, Texas, that there may be potential for redevelopment in Opportunity Zones nearby hospitals and medical centers, particularly for mixed-use developments and multi-family projects. 

Opportunity Zones were created in 2017 with the passage of the Tax Cuts and Jobs Act and investors may defer capital gain taxes until December 2026 in addition to getting a reduction of taxes up to 15 percent after seven years and investors may pay as little as zero taxes on appreciation of Opportunity Zone investments if held in a portfolio for at least 10 years. 

There are other funds interested in investing in Louisiana leveraging Opportunity Zones: NORF 3 Opportunity Zone Fund LLC, which raised $30 million in New Orleans, Galena Opportunity Fund LLC which raised $250 million, Community Outcome Fund, which raised up to $500 million, and Alpha Opportunity Zone Fund I, which raised $250 million from investors. 


Email Kristen Mosbrucker at kmosbrucker@theadvocate.com.