Opportunity Zone 1.0 Multifamily Transactions, 2016–2025

Dennis Lee
Nov 14, 2025
2 min read

An analysis of where capital really flowed — and what that means for the upcoming OZ 2.0.

As discussions around Opportunity Zone 2.0 gain momentum (but before formal release), we wanted to look back at the OZ 1.0 cycle (2016–2025) — to understand what actually worked, where capital clustered, and what lessons might guide the next phase of policy and investment.

This analysis focuses only on multifamily transactions that occurred inside Opportunity Zones within each metro, not total metro-level sales. In other words — we measured how active each metro’s OZ areas truly were, not just how big the metro itself is.

We included only transactions above $2 million — a reasonable threshold to filter out smaller condo trades while capturing institutional and mid-sized multifamily activity.

Quadrant Summary

🔴 Q1 — High Permits / High Rent Growth (Late-Cycle Expansion)

Metros sustaining rent gains despite elevated multifamily permitting (5+ units).

Demand remains resilient, but the window before oversupply closes is narrowing.

Examples: New York (+0.24%), Los Angeles (+0.23%), San Francisco (+0.27%), Seattle (+0.52%), Riverside (+0.54%), Richmond (+0.57%), Orlando (+0.08%)
Market View: Healthy absorption and job growth continue to support rents even as pipelines remain active.

🟢 Q2 — Low Permits / High Rent Growth (Opportunity Zone)

Markets with tight new supply but improving rent performance—typically signaling early recovery.

Examples: Providence (+0.41%), Pittsburgh (+0.94%), Hartford (+1.37%), San Jose (+0.91%), Cincinnati (+0.37%), Buffalo (+0.50%).
Market View: Low permitting and accelerating rent growth suggest undersupplied dynamics—often a prime entry point for acquisitions or pre-development.

🟠 Q3 — Low Permits / Low Rent Growth (Cooling / Correction Phase)

Metros showing soft rents and limited new multifamily starts.

Developers are cautious, and leasing momentum has slowed.

Examples: St. Louis (–0.82%), Memphis (–1.43%), Oklahoma City (–0.92%), Austin (–0.64%), Salt Lake City (–0.32%), Louisville (–0.61%).
Market View: Expect muted activity through mid-2025. Stability will depend on job trends and absorption in existing stock.

🔵 Q4 — High Permits / Low Rent Growth (Oversupply Risk)

Markets where multifamily permits (5+ units) remain high but rent growth is turning negative.

Examples: Dallas (–0.24%), Houston (–0.45%), Miami (–0.38%), Phoenix (–0.37%), Tampa (–0.41%), Raleigh (–0.25%).
Market View: Persistent construction pipelines are creating pressure on lease-ups and rent concessions—signaling late-cycle supply risk.