After a prolonged equity raising slowdown across the fourth quarter of 2022 and the first quarter of 2023, Qualified Opportunity Fund equity raising has roared back to life.

QOFs tracked by Novogradac raised $1.33 billion of equity in the second quarter of 2023, turning around a slow start to the year, when just $682 million of equity was raised in Q1.

As of June 30, 2023, Qualified Opportunity Funds participating in Novogradac’s voluntary survey of the Opportunity Zone investment industry reported a total of $36.10 billion in equity raised since program inception in 2018.

The $682 million raised by QOFs in the first quarter of 2023 was the smallest amount of equity raised in any single reporting period since Novogradac began reporting their data in June 2019. The resurgence in the second quarter is a welcome sign for the industry.

The $1.33 billion raised by QOFs in the second quarter of 2023 is still down sharply from last year’s same-quarter figure of $2.12 billion, but roughly on par with 2021 figures.

The broad S&P 500 index was up 15.91% through the first 6 months of 2023, a sharp (and largely unexpected) reversal from 2022 that may lead to higher growth in QOF investing across the final six months of 2023.

Novogradac QOF Survey Reporting History

Reporting Period End Date	Total Equity Raised (Billions)	Number Of QOFs Reporting Equity Raised	Equity Raised During Period (Billions)
6/28/2019	$0.79	28	$0.79
9/20/2019	$2.50	57	$1.71
10/24/2019	$3.17	112	$0.67
12/9/2019	$4.46	184	$1.29
1/8/2020	$6.72	292	$2.26
4/29/2020	$10.09	406	$3.37
9/1/2020	$12.05	580	$1.96
12/31/2020	$15.16	659	$3.11
4/12/2021	$16.34	708	$1.18
6/30/2021	$17.52	853	$1.18
9/30/2021	$20.28	909	$2.76
12/31/2021	$24.40	978	$4.12
3/31/2022	$28.37	1,035	$3.97
6/30/2022	$30.49	1,097	$2.12
9/30/2022	$32.26	1,231	$2.20
12/31/2022	$34.09	1,274	$1.40
3/31/2023	$34.77	1,298	$0.68
6/30/2023	$36.10	1,330	$1.33

Of note, Novogradac’s survey is not comprehensive. Because Novogradac is only able to survey a portion of the total QOF universe that self reports directly to Novogradac or reports to the SEC, the $36.10 billion reported is only a fraction of the total amount of equity raised by all Opportunity Zone funds.

Novogradac estimates that the actual total is likely three to four times greater that what gets captured in the Novogradac reports, which would put the total amount of QOF equity raised for Opportunity Zones since program inception in the range of roughly $108 billion to $145 billion.

More From Novogradac

Read more about this reporting update: Overall QOF Equity Bounces Back in Second Quarter, but Far Behind 2022 Numbers