ImpactAlpha, Apr. 30 – If you build it, they will come. That was the instinct of Flachsbart, an economic development lawyer in Birmingham, when he discovered the Opportunity Zone provision in the 2017 tax bill.
They were the investors with capital, developers with projects and communities with long-term plans that had too often failed to find each other in the marketplace. Flachsbart built Opportunity Alabama with backing from local funders like the Alabama Power, Regions and Protective foundations.
With contacts with investors, developers and community organizations in every county, Flachsbart has helped facilitate more than $300 million in financing for senior care facilities, local hotels, workforce housing and historic theatres across Alabama.
“Alex and Opportunity Alabama have been a catalyst for growth in our state,” Alabama Power Foundation’s Chris Blake told ImpactAlpha, “bringing needed investments to help revitalize our communities within those Opportunity Zones.”
Flachsbart says each investment has community-aligned impact, in some cases because Opportunity Alabama “extracted” impact improvements from commercial developers like carve outs for workforce housing or dedicated units for nonprofits. The Opportunity Zone incentive “was the shiny new tool in the toolkit that was shiny enough to attract people to the table that we set,” Flachsbart told ImpactAlpha.
To do more, Opportunity Alabama needed capital of its own. Flachsbart brought in Blueprint Local, founded by Ross Baird, ex- of Village Capital, recruited Alabama banker Lindsay Edwards as chief investment officer and tapped local foundations, family offices, individuals and corporations to raise $13 million for the Opal Fund (see, “Opportunity Alabama is combining community and capital to fulfill the potential of Opportunity Zones”).
Opportunity Alabama has leveraged opportunities beyond Opportunity Zones, financing projects with tax credit programs and capital from impact-motivated investors. Through its rural recovery accelerator, Opportunity Alabama has built a pipeline of projects in rural areas. The organization is helping national community development finance institutions like Reinvestment Fund and Hope Credit Union establish their footprints in Alabama.
“If you have the ecosystem and you’ve got this array built, you can do interesting things,” Flachsbart says. “That’s effectively the network that we wound up building.” – Dennis Price