As the $100 million, 86-acre development project drums up talk in Wilmington, Delaware along the Christina River, current residents wonder how this 5-year project will benefit them. The Vice President of the Southbridge Civic Association, Diana Dixon, stated,
“The civic association has submitted letters to ask for greater transparency and engagement with the Southbridge community as we face the dual threats of flooding and gentrification, which may be exacerbated by the plans along South Market Street put forth by the RDC,” for a press release in the Delaware News Journal.
What Will be Included?
The project, initiated by the Riverfront Development Corporation, promises to bring 86 acres of mixed-use development including 4,000+ homes, 1.9 million square feet of office space, and 350,000+ square feet of retail. The district will also have a new riverwalk and several green parks with 13 acres of open-air, common spaces.
Who is Leading the Development?
Leading the development is Wilmington Mayor, Michael Purzycki, who actually served as head of the RDC 25 years ago when the other side of the Christian River got its 100-acre facelift. The vision for Riverfront East will mirror what is now called Riverfront West and will, once finished, be referred to as The Riverfront.
City Councilwoman, Michelle Harlee, who represents the district in development eases the local concern and demonstrates that the project will boost the economy of the area through infrastructure upgrades, job creation, and affordable housing.
“If we are going to be true to our vision, then we ought to put our money where our mouth is and build some housing that reflects the diversity and wider population of Wilmington,” agreed Purzycki.
Where is the Funding Coming From?
Choosewilmingtonde.org outlines the various development projects that are classified as Opportunity Zone projects on their website. This designation offers major incentives to private investors in order to “drive transformative and equitable economic growth in the city’s business district and surrounding neighborhoods.”
Opportunity Zones (OZ) were created to help economically distressed areas by giving investors preferential tax treatment with new investments in these “specified” areas. Similar to QSBS, if the investment meets eligibility criteria and is held for at least 5 years, the investor can defer or be exempted from capital gains taxes (i.e. if held for at least 5 years, the taxpayer can exclude 10% of the gain and the percentage increases (or “steps up”) to 15% after 7 years).
The city of Wilmington, DE seeks to support projects that create jobs or expand employment opportunities and provide multifamily housing opportunities. Phase one of this project alone is said to create 179 construction jobs.
This article does not constitute legal or tax advice. Please consult with your legal or tax advisor with respect to your particular circumstance.