Salt Lake City hopes to use a Trump administration tool to turn the seven “opportunity zones” located within its boundaries into a “life sciences corridor” spanning from the University of Utah’s research park to the city’s northwest side.
The zones, designated low-income communities based on census data, are part of a program created in the 2017 federal Tax Cuts and Jobs Act that will allow big institutional investors, such as banks, to defer capital gains and earn tax-free interest by putting their money into housing and business development efforts within the areas.
“One of the things we found is that over the last year, the number of prospects that have come and worked with our department have really been in that life science space,” Lara Fritts, the city’s director of economic development, told the City Council during a briefing on the plan Tuesday. “And so if there’s all these companies coming and talking to us, maybe it’s an industry we need to be focusing even more attention on. And so we wanted to make sure we were doing that.”
That presentation to the City Council came just two days before Housing and Urban Development Secretary Ben Carson traveled to South Salt Lake to tour a 200,000-square-foot mixed-use real estate development known as the HUB of Opportunity and located within an opportunity zone.
Wearing a hard hat and a bright yellow vest, Carson watched as workers erected the new building at 3900 S. West Temple, adjacent to the UTA Meadowbrook TRAX station in South Salt Lake and heard about the vision for the project. Once it opens next spring, the development will include 156 apartments, space for a specialized employment training center for young adults with autism and a commercial space to attract small businesses.
The planned development “looks like the 22nd century,” he marveled as he looked at the plans.
Carson’s team touted opportunity zones as a way to drive economic growth, revitalize communities and allow more Americans to experience economic vitality — as well as a way to help stem Utah’s affordable housing crunch.
“Americans are very entrepreneurial, innovative people and we’ve come up with some fabulous things that really bring down the cost [of housing] and increase resiliency,” he told reporters after his tour of the facility. “But, you know, there are regulatory barriers," he said, adding that erecting such developments in Utah and elsewhere “will make a big difference.”
Some 60 percent of the units in the HUB of Opportunity development are considered affordable, adding 126 units to the stock in South Salt Lake.
Overall, Utah had 181 census-designated areas that qualified as opportunity zones, 64 of them in Salt Lake County. Gov. Gary Herbert was then able to choose up to 25 percent of the identified sites to receive the benefit, leaving 46 statewide and 15 in the county.
Salt Lake City’s opportunity zones are located mostly on the city’s west side, including in the Glendale, Fairpark, Poplar Grove and Granary neighborhoods. The Northwest Quadrant, home of the future inland port, and area directly south of the Salt Lake City International Airport and east of the Northwest Quadrant, are also included. All are in redevelopment areas and have the zoning necessary to support the kind of development the city envisions.
A life sciences corridor would make sense in Salt Lake City, Fritts argued. The state’s capital is already ranked No. 4 across the country in science, technology, engineering and math (STEM) job growth, is home to a number of major life sciences businesses and is in a strategic location near two interstate highways.
Development in these areas, she said, could spur economic opportunity in Salt Lake City as well as help “accelerate technology” within the targeted industries.
Fritts said she sees particular potential to take advantage of opportunity zones in the Granary District, where there’s already “so much activity” happening. She also pointed to the North Temple area around 300 and 400 West as “an incredible opportunity because there are smaller office buildings there that could easily be converted, purchased and invested in.”