TheBurg

01.20 | theburgnews.com | 13 eXtrA LAYer Opportunity zone projects are hitting the ground elsewhere in Pennsylvania—in Scranton, Erie, Coatesville. In York, a planned, $169 million "Innovation District" meant to promote joint tech developments in energy, defense, 5G infrastructure and cyber security, is "like the poster child" for opportunity zones, said developer John McElligott, CEO of York Exponential Development. e York project, dubbed York Plan 2.0, expands a robotics manufacturing plant across brownfields along Codorus Creek, avoiding gentrification or displacement and creating "good, walkable jobs in the center of the city," he said. McElligott called QOZs a "catalyst to masterplan the whole triangle." A project that started at 240,000 square feet ballooned up to 768,000 square feet because the QOZ "helped accelerate acceptance for the scope." He has aligned the project with a message of American competitiveness in manufacturing, for "a strong narrative that ties closely to why the (opportunity zone) legislation was passed." "ere are investors looking at our project now that probably wouldn't have before," he said. York city officials have jealously guarded the site for years, rejecting proposed projects that didn't maximize its potential, said McElligott. "e metrics on real estate are not hard to figure out if you don't really care about what's going in there," he said. "If you care about what's going in there, you need a different level of patience and grit." Wormleysburg-based Integrated Development Partners has "looked at a few projects, but they almost have to pencil out without the opportunity zone," said Managing Partner Jonathan Bowser. "It becomes an extra layer of incentive. e projects we looked at, none of them were enticing enough to launch without the OZ." e typical challenges of city development— parking, high costs of services, high tax rates—also present barriers to taking advantage of QOZs, said Bowser. While the QOZ can attract capital, developers "still make our money on the underlying performance." Even before QOZ funding is added, viable projects must generate greater return than the developer's investment. "We typically like to look at the project without the incentive, because you just don't know," Bowser said. In central Pennsylvania, "there are probably more people shopping for projects than there are projects that are close to being shovel-ready," Jones said. "is sort of matchmaking game has been somewhat slow to create real opportunity zone success stories so far here." But the ever-optimistic Jones said that Harristown is among those probing QOZs for their original intent—opportunity. "I don't know if we're going to be able to make it work or not," he said, "But we're going to try." To learn more about Qualified Opportunity Zones, visit www.dced.pa.gov, www.irs.gov or the many online stories that address them. Cameron St. Market St.

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