Opportunity Zones 2.0, authorized by Congress via the One Big Beautiful Bill Act, is about to reshape the Seattle commercial real estate development landscape, said Adam Sweet, principal at Eide Bailly.  

Originally designed as a temporary tax incentive to spur development in distressed neighborhoods, OZ 2.0 is now a permanent federal incentive that aims to attract capital to these disadvantaged areas. 

But the zones that were once part of the original opportunity zone program in 2017 may no longer qualify under new standards. It’s estimated that the program will shrink from 139 designated areas to 99 under new regulations. 

Washington’s final decision on what areas qualify is expected to be released in September, with many investors and developers eagerly awaiting it, Sweet said.  

“This program will be new and improved with better incentives and updated zones,” Sweet said. “OZs are long-term investments, as this program is designed for those willing to support sustained development and growth.”

Eide Bailly helps organizations work smarter — financially, operationally and strategically, Sweet said. Eide Bailly's Seattle practice combines the local leadership of Seattle Market Leader Melissa Webb with Sweet's strategic expertise to serve businesses and individuals throughout the region. 

The team specializes in real estate and construction, high net worth and family office advisory, and opportunity zone investments, helping clients navigate complexity and capitalize on opportunities for growth. 

As a top 20 accounting firm, Eide Bailly provides tax, advisory and technology solutions that improve performance, reduce risk and drive long-term success. Backed by more than 3,500 professionals nationwide, the firm is committed to helping its clients grow with confidence, Sweet said.

Sweet will be speaking on the panel The Road To Opportunity Zones 2.0: Where Tax Incentives Drive Development at Bisnow’s Seattle State of the Market on Sept. 15. Click here to register. 

Bisnow spoke with Sweet to learn more about the new opportunity zone program, his firm’s approach to working with clients in this space, and what he’s hoping attendees will take away from the event.

Bisnow: How does Opportunity Zones 2.0 differ from the original program?

Sweet: The existing map of eligible projects will change under OZ 2.0. There will no doubt be some overlap, but there's heightened criteria on what qualifies as an opportunity zone. 

Certain areas right now that are designated as opportunity zone areas will not be so in the future. We don't have that map yet, but it will be unveiled soon. A lot of people are waiting to see that right now. 

There will also be new and better tax incentives with the OZ 2.0. People are just waiting on the sidelines because there will be more tax incentives to invest after the end of 2026.

Bisnow: Can you tell us about your role at Eide Bailly?

Sweet: I am a tax attorney by training, and I am part of our national tax office. Primarily, I do partnerships in what we call “flow-through entities,” but I also do a bit of merger and acquisition work. I also lead our opportunity zone working group, so when clients want to make an investment, or are contemplating making an investment, we do consulting and structuring services. 

Bisnow: What types of transactions and clients define your practice today?

Sweet: Our primary clients are closely held businesses. We range from clients with $10M to $20M of revenue to clients who are valued at a billion dollars. Our sweet spot, however, is closely held, family-controlled businesses or small groups of business owners — whether it be real estate, manufacturing and so on. We cater to a range of clients in industries who are mostly looking to invest in real estate.

Bisnow: You’re speaking on the Seattle Opportunity Zones 2.0 panel at the Bisnow event. With Seattle’s changing zoning laws and high building costs, how are developers using these tax zones to kick-start new projects?

Sweet: What developers do is they factor the tax benefits into their projected returns, so when they're soliciting capital or talking to investors, part of the return is going to be the tax benefits. In a market like downtown Seattle, zoning requirements and construction costs can make development more expensive. These tax incentives can help ease that financial burden. The government is basically subsidizing these projects by reducing the investor’s tax liability, making development more attractive.

Bisnow: What's the one thing you want attendees to walk away understanding about how to navigate this market?

Sweet: OZs are a long-term play, so I hope people really try to maximize opportunity zones and their impact. They are complicated by the nature of the program, so people should work with an adviser. 

This isn't a typical real estate deal that you can just go out and do on your own. We have clients sometimes that jump into it thinking they understand the program and simply don’t have it together, at no fault of their own. It's a technical tax program, so it’s essential to consult an adviser who can steer you in the right direction.

Click here to register for the event.

Learn more about Eide Bailly at eidebailly.com. 

This article was produced in collaboration between Eide Bailly and Studio B. Bisnow news staff was not involved in the production of this content.

Studio B is Bisnow’s in-house content and design studio. To learn more about how Studio B can help your team, reach out to studio@bisnow.com.