The establishment of U.S. Treasury-certified opportunity zones in Forsyth County in May 2018 continues to provide mixed results to residential markets in seven census tracts reviewed in a report by Attom Data Solutions.
Opportunity zones are economically distressed census tracts qualified to receive private investments through a new vehicle known as opportunity funds.
The goal is connecting those tracts with investors, offering tax credits and other tax incentives to get investors involved.
All but one of the 11 Forsyth tracts are in the central part of Winston-Salem. They account for more than 25,000 residents. They are among 47 in the Triad and Northwest North Carolina, and 252 statewide.
The seven Forsyth tracts reviewed by Attom for the fourth quarter are:
- Tract 1, which contains the central business district.
Since the tract was identified as an opportunity zone, the average home price started at $158,000, climbed to a high of $182,000 in the second quarter and was $177,500 in the fourth quarter.
- Tract 2 represents the northern part of the central business district.
The average home sales price began at $193,500, rising to a high of $275,000 in the second quarter and was at $157,500 in the fourth quarter.
- Tract 7 contains the recent renamed Innovation Quarter in downtown Winston-Salem.
The average sales price began at $33,000 and was at $38,000 in the fourth quarter.
- Tract 8.02 covers the Atkins Community Development Corp.
The average sales price began at $47,500 and was at $58,000 in the fourth quarter.
- Tract 14, which contains Whitaker Park, a 1.7-million-square-foot former R.J. Reynolds Tobacco Co. plant. The campus is part of a high-profile renovation project being undertaken by Whitaker Park Development Authority Inc. and mixed-use developer Chris Harrison.
The average home sale price began at $55,250, reached as high as $75,500 in the third quarter, but was at $55,500 in the fourth quarter.
- Tract 17, which contains Lakeside Villas multifamily housing development.
The average home sale price when the opportunity zone program began was $145,000. It has since fluctuated from a low of $80,000 and was at $81,500 in the fourth quarter.
- Tract 33.13, which contains Horneytown Road. The average home sale price began at $139,000, falling as low as $113,000 in the third quarter of 2019 before surging to $201,000 for the fourth quarter of 2019.
“Home prices in thousands of opportunity zone neighborhoods targeted for revival across the United States continued to ride the tide of the national housing market boom in the fourth quarter of 2019, marching along with broad trends and even doing better in many areas,” said Todd Teta, Attom’s chief product officer.
“These areas are among the most vulnerable to economic downturns. As a result, the recent upswing could change on a dime if the broader housing market flattens out or sags,” Teta said.
“But for now, the price gains are a crucial measure that neighborhoods designated as opportunity zone tax breaks hold significant allure for potential residents,” he said.
Winston-Salem city officials consider opportunity zones as another “tool in the economic and community development toolbox that can be used to help spur private development and redevelopment in some of the areas in our community that have not seen the growth.”
“We truly hope that it will help prime the pump to create new investment and jobs for our residents.”
Harrison announced plans on Oct. 10 to convert historic Buildings 2-1 and 2-2 on the Whitaker Park campus into 164 loft apartments at 951 Reynolds Blvd.
The goal is to begin renovation by March 31 and have the units available by late 2020.
When including new-construction plans for 25,000-square-feet of retail space, a 125-room hotel and another 150 residential units, Harrison projects an overall project cost of between $80 million and $100 million. He said he hopes to have the entire project completed by the end of 2023.
Bob Leak Jr., the president of Winston-Salem Business, said when discussing Harrison’s mixed-use project that “there have been some general inquiry conversations” about local opportunity zone tracts.
“It certainly could work on the (Whitaker Park) project,” Leak said.
There are 12 tracts in Guilford County, along with four in Alamance, three each in Randolph, Rockingham, Surry and Wilkes, two in Davidson and one each in Alleghany, Ashe, Davie, Stokes, Watauga and Yadkin.
The certified opportunity zones list for North Carolina has at least one low-income census tract in each of the state’s 100 counties. Tracts that touch the state’s major industrial-site development areas and hurricane-impact areas are included.