The Capital Gains Opportunity Fund is a $250 million fund that will invest equity in real estate projects located in Designated Opportunity Zones. After all the equity earns a 10% IRR, the fund will split the upside 50-50 with the developer. The developer is required to invest 10% of the equity and the fund will invest 90% of the equity. The fund managers (Thomas Ablum, Elliot Newman, Steve Rosen, and Jeffrey Novak) have prior development experience and track record.
The fund will consider most asset types nationwide, especially student housing, multifamily, seniors housing and hospitality asset types. The minimum project size is $30 million, and minimum equity check size is $8 million. CGO’s preference is development or substantial re-development projects that have a total project cost between $30 million and $120 million with appropriate leverage.
The fund was formed in October 2018 as a Delaware LLC and the fund manager was established in February 2019 as a Delaware LLC. For more than 40 years, the managers of CGO have advised real estate development companies financiers, professionals and investors in the formation, funding, execution and management of commercial real estate transactions.