Summary of the Risks of the Offerings

  • Investors in Carolina QOF I or subsequent funds  ("the Funds") risk losing all capital invested therein.

  • Members may not withdraw or transfer their membership interests without consent of the board of Carolina Opportunity Funds LLC or in violation of SEC Rule 506 of Regulation D or IRS Section 1400Z.

Opportunity Zone Fund Risks

  • The OZ and subsequent QOF program was just created in 2018 and the IRS rules under Section 1400Z are still in progress. The impact of the final regulations may have unanticipated consequences on the Funds.

  • The Funds must maintain their status as QOFs for 10 years and investors must hold their investments in the Funds to take advantage of the exclusionary tax benefits of future gains.

  • The Funds board will comply with the requirements of Section 1400Z of the IRS Code regardless of the success of the Funds investments or the strategic timing of an investment exit.

Real Estate Risks

  • The Funds are subject to all of the risks of any real estate investment.

  • Real estate investments are speculative in nature.

  • There are real estate risks that cannot be controlled by Carolina Opportunity Funds LLC management or board which can adversely affect the value of the Funds. These include but are not limited to:

    • Downturns in the economy, whether global, national, or local.​

    • Interest rate rises or contraction in real estate financing markets.

    • Oversupply or demand for specific real estate products in markets where the Funds have invested.

    • Unforeseen entitlement or due diligence issues such as Phase 2 or Brownfield compliance costs.

    • Changes in zoning, traffic patterns, or eminent domain due to government actions.

    • Adverse tax assessment changes.

    • Property losses resulting from weather events where insurance fails to protect.

    • Increases in operating expenses due to tariffs and/or duties on materials. 

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