From left are Byna Elliott, chief enterprise responsibility officer, Fifth Third Bank; Maurice A. Jones, LISC president and CEO; Catherine Cawthon, Fifth Third CDC president; and Jesse Van Tol, CEO National Community Reinvestment Coalition discuss Fifth Third’s $100 million investment in projects that support community development through four Opportunity Zone fund partners. Photo provided
By Larry Magnesen
Fifth Third Bank
Fifth Third Bank, National Association, announced that Chicago-based Decennial Group will serve as a partner to help it invest $30 million in Qualified Opportunity Zones as part of its $100 million commitment. The funds will be used to develop projects in low-income urban and rural communities within the bank’s footprint. The $100 million investment by Fifth Third Bank represents one of the largest made by an institution with a social impact investment strategy in Opportunity Zones.
“We are thrilled to partner with Decennial to work on Qualified Opportunity Zones in Chicago and throughout Illinois and the Midwest,” said Mitchell Feiger, regional chairman and CEO of Fifth Third Bank, Chicago. “With this agreement in place, Decennial Group is working to immediately identify qualified development opportunities in Chicago and other Midwest markets. The group’s goal is to deploy Fifth Third’s capital and accelerate market activity in order to create high-quality, affordable housing. Fifth Third expects to make a substantial commitment to Illinois with this program.”
Decennial Group is a vertically integrated investment management and development platform that will manage the assets for a minimum of 10 years, consistent with the requirements of investments made in Qualified Opportunity Zone locations.
“Decennial Group was created to lead pioneering investments in underserved communities,” said Bob Clark, Decennial Managing Partner and Clayco CEO. “This partnership with Fifth Third will allow us to make a significant impact in Qualified Opportunity Zones in Chicago, the state of Illinois, and throughout the Midwest. We intend to bring the full impact of Decennial’s financial, operational, and industry expertise to create projects that help transform underinvested neighborhoods into affordable, vibrant, and thriving communities.”
Designed to spur long-term private sector investment into economic development and job creation in economically distressed communities, Opportunity Zones were established as part of the 2017 Tax Cuts and Jobs Act to promote investment and development in a significant number of qualified low-income census tracts. Investment projects will need to satisfy the following Fifth Third social impact criteria:
- Located in a qualified Opportunity Zone
- Public welfare investment eligible
- Project will be developed by an experienced, credit-worthy sponsor
- Located in an MSA where Fifth Third has determined community need under the CRA
- Actionable before the end of June 2020
- Expected to generate a positive economic return
- Offers opportunities to expand relationships with the bank
The $100 million investment will be used in three key investment categories: affordable housing; workforce housing and other community priorities for multifamily development; and certain non-residential or mixed-use real estate serving a particular community need, as well as projects that contribute to local job and business growth.