Inland closes $28M opportunity-zone fund for St. Paul conversion

Inland Real Estate Investment Corp. has closed an approximately $28 million equity raise for Office Conversion Opportunity Zone, a qualified opportunity fund sponsored by an affiliate of Inland Investments. IREI reports the offering was fully subscribed.

The fund owns 89% of a 16-story building at 386 Wabasha St. North in downtown St. Paul, in a census tract designated as a qualified opportunity zone. The building is being redeveloped from underused office space into 178 apartments and roughly 2,338 square feet of street-level retail. The completed residential project will be called The Stella.

Kaeding Development Group is the development partner. R.E.C. Inc., operating as Ron Clark Construction & Design, is the general contractor. Bader Management Inc. is the property manager. Inland and Kaeding have completed six projects together. Four of the six involved ground-up development or adaptive reuse.

The full subscription is a modest but useful marker for conversion-focused multifamily sponsors. It suggests opportunity-zone equity is still available when a project brings a named contractor and a repeated development partnership. The mix gives investors a construction story to underwrite, not just a tax vehicle.