EDOs play a significant role in zoning regulations, advocating for policies that support economic growth and community development. An effective EDO will streamline zoning processes to attract the right businesses in the right area, often called economic development districts. These districts target specific industries and often include tax incentives to attract the right business and residential development mix. 

In this section, we will discuss two significant zones that are shaping the commercial landscape. The first is an established opportunity zone, and the second is the recently announced Tech Hubs by the Department of Commerce. These Tech Hubs designations have gained considerable attention because they come with the opportunity to receive grants in the range of $40-70M out of a total of $500M budgeted from the Department of Commerce. This injection of resources will help attract technology companies to become established and grow in these markets. 

Opportunity Zones

Opportunity Zones offer investors a chance to defer and reduce taxes on capital gains. The investor can avoid all capital gains taxes if the investment is held for ten years. This tax benefit has led to increased interest in real estate development and has assisted in revitalizing communities in opportunity zones.

With the added tax benefit, opportunity zones often see a rise in real estate development and commercial projects. Investors will leverage the advantage of the tax incentive to overcome the risk of investing in these areas that typically carry higher vacancy rates due to economic challenges. 

Opportunities Zones can lead to an increase in property values, which may benefit property owners. However, this may also lead to concerns about gentrification and displacing current residents if community stakeholders are not adequately engaged. 

The Opportunity Zone incentives aim to stimulate economic growth in underserved communities, create job opportunities, and improve the quality of life for all residents. Commercial real estate developments often bring new jobs, which increases the tax base. 

This increase in the tax base can lead to infrastructure improvements, better neighborhood amenities, and an overall increase in the quality of life for everyone in the community. 

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