Qualified Opportunity Zone Funds Raise More Than $1 Billion in Q2 2025
Investment in qualified opportunity zone funds, or QOFs, surpassed a billion in the second quarter of 2025, specifically $1.14 billion, according to the latest data tracked by Novogradac – a certified public accounting, valuation, and consulting organization that specializes in federal tax incentives. This was the highest quarterly amount in nearly a year and the second highest in two years. The second-quarter equity increase brought the year’s new equity total to $1.95 billion.
The 2,080 QOFs tracked by Novogradac – of which 1,653 report a specific amount of equity – reported an overall $42.05 billion in QOF equity as of June 30. QOF figures reported by Novogradac don’t include proprietary or private funds owned and operated by their principal investors. It is estimated that actual opportunity zone investment is greater than the Novogradac total by up to three times.
The second quarter ended four days before the president signed into law reconciliation legislation that included a provision to make opportunity zones permanent. Thus, as a permanent part of the tax code, there is an expectation that opportunity zone investment will significantly increase beginning in 2027 when the new zones are designated. The “dead year” of 2026 – when there will be fewer benefits available to investors, and the new zones and new benefits will not have started – is expected to be relatively slow for investment.
Of the $42.05 billion in equity raised through QOFs, residential development is top real estate area of investment. A total of $8.74 billion, 20.8%, was raised by QOFs exclusively dedicated to residential projects. When you include funds that have at least some focus on housing, that Novogradac number jumps to $33.46 billion. Within this broader category, multifamily housing is the most common type of investment, raising $30.83 billion.
Novogradac has tracked 203,560 homes in 238 cities financed by QOFs since the dawn of the incentive in 2018.
For the first time, Phoenix has moved past Nashville in this report as the city with the most QOF-financed homes. Phoenix is one of nine cities with more than 5,000 homes financed by QOFs. Fifty-one cities have at least 1,000 QOF-funded homes and 182 have seen at least 100 homes built.
QOFs have also raised a significant amount of equity for commercial development, according to Novogradac’s analysis. QOFs dedicated solely to commercial projects have raised $2.57 billion. However, a much larger sum of $27.81 billion has been raised by QOFs with at least some investment in commercial properties. Within this category, retail and office spaces have attracted the most capital, raising $19.89 billion and $16.46 billion, respectively.
Novogradac noted that a large percentage of commercial-focused QOFs combine that with residential, explaining why the sum of equity raised by QOFs working on commercial property and those working on residential property is far greater than the $42.05 billion. Meanwhile, hospitality-only ($822.9 million), renewable energy-only ($179.6 million) and operating businesses-only ($342.7 million) QOFs round out the data, with each of those having more than $1.5 billion in investment when you add the QOFs that include (but are not exclusive to) those targets.
In addition to the type of investment targeted by QOFs, Novogradac breaks down investment by geographic target. Of the 1,653 QOFs that report a specific amount of equity raised, 1,122, or 79.9%, focus on a single city. Those QOFs have raised $12.11 billion, which is 31.5% of all equity raised by QOFs for which a geographic target is identified. The other 283 QOFs, which have investment plans in multiple cities, have raised 68.5% of equity for QOFs with known targets.
Novogradac data confirms what seems obvious: Nearly all QOFs either raise funds for a specific project (and raise less total) or are large funds with a nationwide emphasis (and raise more money).
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