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ANTICIPATING A CAPITAL GAIN IN 2027? 

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Find out more about our future Opportunity Zone Funds 

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Preparing for the Next Opportunity Zone Cycle

Urban Catalyst's OZ Track Record

Urban Catalyst has launched two Opportunity Zone funds focused on ground up development in downtown San Jose. Fund I successfully raised over $131 million. Fund II holds a portfolio of four projects across multifamily and hospitality, all of which received discretionary approvals.

One project, the Keystone Hotel, is completed and open for business.

Urban Catalyst functions as both a fund manager and developer, providing us with the agility and expertise necessary to effectively tackle challenges within the dynamic real estate market. As developers deeply rooted in the heart of downtown San Jose, our commitment to the revitalization of the downtown core goes beyond constructing buildings. We believe in fostering sustainable economic development, creating job opportunities, and contributing to the overall well-being of the community. 

240426.2_ProjectMap--1

 

OPPORTUNITY ZONES 2.0

Key OZ 2.0 Potential Benefits:

Permanent status

Opportunity Zone policy is no longer sunset-dated. It will become a standing component of the Internal Revenue Code.
Rolling five-year gain deferral

Any qualifying gain invested into an OZ fund after December 31, 2026 receives a five-year deferral.
New basis step-up schedule

Standard Qualified Opportunity Fund (QOF) investors receive a 10% basis step-up after five years; Qualified Rural Opportunity Fund (QROF) investors receive 30%.
Additional rural incentives

Rural OZ tracts (defined as areas outside cities or towns of 50,000 people or contiguous urbanized areas) also enjoy a lower 50%  substantial-improvement threshold, versus the usual 100%.
We've compiled a comprehensive timeline of updates, along with curated articles, blogs, and podcasts from leading industry voices. These resources capture the key developments, implications of the finalized legislation, and what the future of Opportunity Zones will look like moving forward. Read more
Zone re-designations every decade

Governors must select new zones every 10 years starting July 1, 2026. New zones will take effect every 10 years, starting January 1, 2027.
Tighter census tract criteria

The “low-income community” threshold falls from 80% to 70% of area or statewide median family income, and the non-low-income contiguous tract exception disappears. Also of note, the special rule for Puerto Rico is stricken from the statute. The island loses its blanket designation, and now may only select up to 25% of eligible tracts, just like all other states.
Expanded reporting requirements

Cleared Senate parliamentarian review, promising greater transparency for funds and investors.

OPPORTUNITY ZONE FUND IN THE HEART OF DOWNTOWN SAN JOSE

Opportunity Zone Fund II (“Fund II) is a private equity real estate development fund focused on ground up development in downtown San Jose, California. Fund II has a diversified portfolio of asset classes including multifamily, hospitality and senior living. Fund II includes four projects: Icon (multifamily), Echo (multifamily), Gifford (senior living) and Keystone (hotel - Marriott Towneplace Suites). Fund II is raising $200 million for these projects. The Marriott hotel (Keystone) is under construction and anticipates opening in Q2 2025. Urban Catayst owns all of the land for these projects and has approvals to start construction. 

To receive the tax benefits associated with opportunity zone funds, an investor must invest capital gains. Investors have 180 days to invest into a qualified opportunity zone fund after the date of their initial capital gains event. 

POTENTIAL TAX BENEFITS:

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Interested in learning more?

ECHO
Multifamily | 388 units
  • Centrally located, just yards away from the future Bart station and near tech campuses including Google, Adobe, Zoom, and more
  • High-density residential real estate with amazing amenities, including infinity pool, an indoor/outdoor fitness facility with a lounge, movie room, game room, and full kitchen, and an amazing rooftop lounge, helping alleviate the housing shortage in Silicon Valley
  • Walking distance from tech campuses, City Hall, San Jose State University, restaurants, bars, cafes, small businesses and all downtown San Jose has to offer

  • Received unanimous San Jose City Council approval

ICON*
Multifamily | 650 +/- units

  • A 26-story residential building, with related amenity spaces, and ground floor commercial spaces over one level of subterranean parking garage

  • Located on Santa Clara Street, the main drag of the central business district, across the street from City Hall and yards away from a future BART station, this project is the definition of Transit Oriented Development

  • This multifamily building is in Downtown San Jose, with forty thousand square foot floor plates, 14-foot floor heights, floor to ceiling windows, adequate parking, including 175 bicycle parking spaces, and a beautiful design

  • Walking distance from City Hall, San Jose State University, restaurants, bars, cafes, small businesses and more

*Currently, Icon is entitled for office space, however, a preliminary application has been submitted to the City of San Jose to change the use to Multifamily

Gifford Place Project, part of our Opportunity Zone Fund II

Keystone Project, part of our Opportunity Zone Fund II

Senior Living (169 Units)
GIFFORD PLACE

Highlights:

  • Delivering the critical need for assisted living and memory care in the urban center of San Jose, with amazing access to Downtown San Jose's amenities and activities

  • The first senior living project in downtown in decades, Gifford Place addresses the coming “gray wave” in Silicon Valley, the hottest senior living market in the country

  • Located near the affluent neighborhoods of Willow Glen, Rosegarden, and Naglee Park

Project Status:

  • Demolition completed and shovel ready

Marriott Hotel (176 Keys)
KEYSTONE

Highlights:

  • Highly-coveted location: 300 yards from Google’s planned mega-campus and 3 blocks from Adobe’s Global Headquarters

  • Steps away from the SAP events center (the most used events center in the country behind Madison Square Garden) and next to the largest multi-model transit hub on the West Coast: San Jose Diridon Train Station

  • Keystone started vertical construction in January 2023

Project Status:

  • Vertical construction in-progress

Multifamily  (388 Units)
ECHO

Highlights:

  • Centrally located, just yards away from the future Bart station and near tech campuses including Google, Adobe, Zoom, and more

  • High-density residential real estate with amazing amenities, including infinity pool, an indoor/outdoor fitness facility with a lounge, movie room, game room, and full kitchen, and an amazing rooftop lounge, helping alleviate the housing shortage in Silicon Valley

  • Walking distance from tech campuses, City Hall, San Jose State University, restaurants, bars, cafes, small businesses and all downtown San Jose has to offer

Project Status:

  • Received unanimous San Jose City Council approval

Echo Project, part of our Opportunity Zone Fund II

Icon Rendering for Hubspot-1

 

Multifamily* (650 +/- Units)
ICON

Highlights:

  • A 26-story residential building, with related amenity spaces, and ground floor commercial spaces over one level of subterranean parking garage

  • Located on Santa Clara Street, the main drag of the central business district, across the street from City Hall and yards away from a future BART station, this project is the definition of Transit Oriented Development

  • This multifamily building is in Downtown San Jose, with forty thousand square foot floor plates, 14-foot floor heights, floor to ceiling windows, adequate parking, including 175 bicycle parking spaces, and a beautiful design

  • Walking distance from City Hall, San Jose State University, restaurants, bars, cafes, small businesses and more

Project Status:

  • *Currently Icon is entitled for office space, however, a preliminary application has been submitted to the City of San Jose to change the use to Multifamily

     
OZ-map-

WHAT IS A QUALIFIED OPPORTUNITY ZONE?

A Qualified Opportunity Zone (QOZ) is a designation originally created by the Tax Cuts and Jobs Act of 2017 to encourage investment in economically distressed communities. The program allows investors to defer and potentially reduce capital gains taxes by investing in Qualified Opportunity Funds (QOFs), which are investment vehicles that deploy capital into businesses or real estate projects located in designated Opportunity Zones.

Eligible Gains

Opportunity Zone investments are available to investors with eligible capital gains, including gains generated from the following sources:
TOUCH
Sale of Stock
Sale of Stock

Capital gains often come from stock options or active investing in the stock market.

TOUCH
Sale of Business
Sale of Business

Selling your share of a business makes you eligible to potentially defer your capital gains.

TOUCH
Sale of Property
Sale of Property
Investing capital gains from real estate sales into an OZ Fund can potentially help preserve equity and defer taxes.
TOUCH
Sale of Crypto
Sale of Crypto
Selling cryptocurrency and realizing capital gains can qualify you for potential tax deferral by investing in an OZ Fund.

WHY DOWNTOWN SAN JOSE?

  • Downtown San Jose sits at the center of Silicon Valley’s long-term growth, combining employment expansion, housing demand, and significant public and private investment.

  • Economic growth in San Jose often outpaces that of other regions, which can lead to appreciation in property values over time.

  • Downtown San Jose presents a compelling multifamily investment opportunity, with demand consistently outpacing supply, resulting in strong rent growth and high rental rates. Read more 

  • Google broke ground on its Downtown project, which will eventually bring as many as 25,000 Google jobs, millions of square feet of office space, and thousands of new homes.

  • There are currently more than 50 development projects underway in the downtown core and another 50 within a mile of downtown.

DTSJ-LEGEND-1

FREQUENTLY ASKED QUESTIONS

Why is Urban Catalyst not offering an Opportunity Zone fund in 2026?

Urban Catalyst closed Opportunity Zone Fund II at the end of 2025. We do not anticipate launching a new fund in 2026 as we focus on advancing existing projects and maintaining a disciplined approach to future fund formation.
When might the next Opportunity Zone fund launch?

Timing depends on the selection of the census tract and property acquisition, but we anticipate a potential launch in 2027.
How does Urban Catalyst stay active in the Opportunity Zone space?

We continue developing, entitling, and operating OZ projects in downtown San Jose while monitoring policy, legislation, and market trends.
Why focus on downtown San Jose for Opportunity Zone development?

It’s a supply-constrained, employment-driven market with strong long-term housing demand. Urban Catalyst has over two decades of experience in the downtown core.
Why Urban Catalyst?

Urban Catalyst's unique differentiator is our developer-first approach and deep local expertise. With years of experience developing in San Jose, including being recognized as the Silicon Valley Business Journal’s 2024 Developer of the Year, we leverage our deep understanding of local processes and strong relationships with key property owners and local officials to efficiently secure the best projects.
We've compiled a comprehensive timeline of updates, along with curated articles, blogs, and podcasts from leading industry voices. These resources capture the key developments, implications of the finalized legislation, and what the future of Opportunity Zones will look like moving forward. Read more

What are my capital gains tax advantages if I was to invest in the Opportunity Zone Fund II?

You'll defer your federal taxes until 2027 and have federal tax-free profits after 10 years.

Why should I invest with Urban Catalyst?

Urban Catalyst is a Private Equity firm with 20+ years of experience in ground-up development. Fund II is a diverse portfolio with 4 properties including multifamily, senior living, hotel, and more. Urban Catalyst has discretionary approval for all projects with one project, the Keystone Hotel project, already under construction.

Is investing in California risky?

California not only has the highest property values but also has the highest household income growth rates in the country.

Where can I find more granular fund information including PPM, IRR, etc?

We'd be happy to connect and send you additional information. Schedule a call to start the process.

Can I meet your leadership team in-person?

Yes! We work where we develop - our office is located in downtown San Jose. We host both in-person events and meetings, while also hosting remote webinars. Our favorite in-person event includes project site tours so you can see your investment dollars at work.

What are the benefits of investing with a Private Equity Fund that's also the Developer?

Being both the developer and the equity partner allows us to make the best decisions for all of our investors. We're in full control of when a project starts and it's progression. Having this ability is what sets us apart from the rest and allows us to do what's right on behalf of our limited partners and investors.