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Rock Island’s Riverfront: The Redevelopment Story
Beth Payne, Administration Director
Renaissance Rock Island
In the 1980’s, one of Rock Island’s major employers, International Harvester, closed its doors resulting in a loss of 5,000 jobs.
Rock Island's population dropped over 20%, and a common bumper sticker read “If you are the last one to leave, please turn out the lights.”
The History
Instead of giving up, the community joined together to seek ways to promote new development, new housing, new businesses, expansion of current businesses and to improve the overall quality of life in Rock Island.
The renaissance began and GROWTH was birthed, serving as a catalyst to spur the commitment and investment of public and private partners.
The History
• 21 units currently under construction or predevelopment in Rock Island
• 118 units currently under construction or predevelopment outside of Rock Island
Today 243 units of downtown housing created
• Owner/ Developer
• General Contractor
• Construction Management
• New Construction
• Single Family Rehabilitation
Today 1142 Single Family Homes Impacted in the Region
• Over 30 year history working in Rock Island since the 1980’s
• Lead of Regional Coalition since 2009
• National non-profit since 2012
Today 680 Homebuyers welcomed to the region
Economic Growth Corporation
Comprehensive Approach to
Community Revitalization
Economic Growth
Corporation
Bridge Investment CDC
Development Association of
Rock IslandThe District
Central States Development
Partners Inc CDE
Comprehensive Approach to Community Revitalization
Who We Are. What We Do.
$1,800,000 in commercial lending
and support
$17,000,000 New Market Tax Credits
closed/ facilitated
$16,000,000 in residential loan product
$162,000,000
Community Investment
17 business currently
being incubated
680
homebuyers assisted
2000 Local jobs supported
$1,000,000
Increase in retail
sales tax
$233,000,000 Generated in local
economic impact
44 units
commercial management
1142 units
of single family units in region
243 units
of downtown housing
147 units currently under construction or under predevelopment in the region
280 employees purchased homes in Rock Island to date through Employer Assisted homebuyer program
$1,500,000 downpayment assistance to 280 employees through Employer Assisted Homebuyer program
$27,000,000 generated in real estate transactions with 49% of participating households relocating to Rock Island from outside communities
PartnersExpert in Public-Private Partnerships
Downtown Housing Rebuilds Critical Mass
First Mortgage $1,700,000–Risk Sharing 50/50 insured by IHDA & USHUD–Funded by the AFL-CIO
•Second Mortgage $ 750,000–Funded by HTF
•Third Mortgage $ 275,320–Funded by the City of Rock Island
•Equity $3,308,870–Historic $ 433,210–Affordable $2,758,466–Deferred Dev. Fee $ 117,194
•Grants $ 272,000–City Façade $ 30,000–State Energy $ 68,000–AHP $ 175,000
•Total $6,307,190•Other
–15 year property tax negotiated schedule– 30 year lease back of commercial space
Goldman & Renaissance Lofts
Goldman Lofts
Renaissance Lofts
Goldman & Renaissance Lofts
Goldman Lofts
Goldman & Renaissance Lofts
Renaissance Lofts
Reinventing One Block
Reinventing One Block
Goldman Lofts
The process begins with decision of a property owner to donate a white elephant structure to a local not-for-profit.
Goldman Lofts – 28 units
Goldman & Renaissance Lofts
In one project two white elephants were converted to 52 units of loft housing.
Patience can be a virtue.
Goldman Lofts
501 c3 status allowed tax benefits to exceed probable cash sale proceeds.
Splitting the parcel, the former annex became the offices of Renaissance Rock Island, now home to a new downtown business.
Goldman Lofts
$6.3 million development employed 100 workers through various trades. An additional 40 persons were utilized in peripheral positions.
Renaissance Lofts – 24 units
Goldman & Renaissance Lofts
Renaissance Lofts
Innovative partnerships transforming Rock Island!
Renaissance Lofts
Units are attractive to young professionals.
Goldman & Renaissance Lofts
Goldman & Renaissance Lofts
Community-based developer takes back a 30 year, $1 per year lease on commercial space.
Commercial space – MidCoast Gallery known as “The ARTery”
Goldman & Renaissance Lofts
Commercial space – Shear Elements & SK Models
Goldman & Renaissance Lofts
Commercial Space Lease Back
•$1.00 per year + pro rata share of taxes, insurance & maintenance.
•Sublease income pays for commercial build out costs then becomes an annuity for the not-for-profit.
•Gives us flexibility for income or retail development.
Zin Wine Lounge
ICONS MartiniHickey Bros.
Shear Elements & SK Models
Atlante
Renaissance Lofts: Highest Commercial Performer
Goldman Lofts: Business Incubator Supporting Arts & Wellness
Taste Buds Be Well QC:
QC Holistic StudioMidcoast Gallery
West
Sources of Funding:Neighborhood Stabilization Program 2 $5,908,898
MWA Bank $1,305,000
City of Rock Island TIF $740,000
US EPA $300,000
State Donation Tax Credits $318,200
DCEO $36,000
Total Project Cost $8,831,087
Jackson Square 51 Full Time Jobs Supported
Award-winning project• Eddy Award for Revitalization - River Action
• Wyvetter H. Younge Illinois Affordable Housing Award
• Certificate of Appreciation - Quad Cities Riverfront Council
• Community First Partnership Award - Federal Home Loan Bank of Chicago
GROWTH purchased this 87 year old site in 2010 to advance the Downtown Strategic Plan, Arsenal Gateway Plan and meet housing needs of the community
Jackson Square
Jackson Square
Features: •3 bedroom / 2 bath Units
•High Speed Internet, Washer & Dryer Hook Ups in Units
•3,159 Sq Ft of Community Space, Kitchen& Meeting Rooms
•3,700 Sq Ft Future Commercial Space on First Floor
Rent Ranges:$432 - $875
Unit Counts:
1 Bedroom (830 sq ft) = 32 Bedroom (925 sq ft) = 173 Bedroom (1300 sq ft) =10
Over 40,000 sq. ft. of blight demolished
Nearly $1,000,000 spent in environmental remideiation
Jackson Square
Jackson Square-2012
Jackson Square- 2016
$215,900
$10,000 Grant
$920/PI
$194,900
$5,000 Grant
$831/PI
$159,900
$6,247EAP Grant
$682/PI
$215,900
$10,000 Grant
$920/PI
$215,900
$10,000 Grant
$920/PI
$149,900
$5,997EAP Grant
$639/PI
\\
$194,900
$5,000 Grant
$831/PI
The Garden District
The Garden DistrictModel Unit: 2448 3rd Ave
The Garden DistrictModel Unit: 2448 3rd Ave
The Garden DistrictModel Unit: 2448 3rd Ave
The Garden DistrictModel Unit: 2448 3rd Ave
The Garden District
Total Project Budget Amount
Debt $1,105,000
City of Rock Island- TIF $25,000
Foundation $15,000
Illinois Attorney General National Foreclosure Settlement Funds– Sales Proceeds
$60,000
NSP 2 $300,000
NSP 1 $45,000
IHDA- State Affordable Housing Tax Credits $215,800
Deferred Dev Fee & Sales Proceeds $95,000 + $229,288
Total $2,090,653
The Garden District
A national for-profit Community Development Entity, Central States has a pending $48 million application for its own allocation of NMTC.
Governance Structure & Roles
GROWTH Corp.Board of Directors
Central States Development Partners, Inc.
CDEAdvisory
Board
GROWTH Board of Directors is Governing Body of Central States Development Partners, a for-profit Community Development Entity.
CDE Advisory Board: Ensures that activities of CDE are occurring in low income communities.
Central States Development Partners, Inc. • Central States Development Partners (Central States) is a nationwide
CDE, formed by its parent non-profit, Economic Development Growth Corporation (GROWTH), to utilize NMTCs to revitalize low-income communities.
• Central States is primarily focused on three states: Illinois, Indiana, and Iowa.
• Utilizes coordinated efforts to bring mixed-use, manufacture, healthcare and fresh food to communities
• Central States applied for $48 million of NMTC allocation in this round, which is expected to be announced in October/ November.
Central States Development Partners, Inc. • Central State’s parent entity, GROWTH and its affiliates, have provided over
$49 million of financing to projects in low-income communities.
• Central State’s focus is on projects that create opportunity (accessible jobs) and add amenities that improve the quality of life in areas which are the most highly underserved in the target geography.
• Central State’s prioritizes projects that have community alignment, a demonstrated need for gap capital, demonstrated ability to improve the low-income community and long-term viability.
• Experienced working with NMTC projects:
• Dot Foods $10 million of allocation• Hill and Valley $10 million of allocation
Application for National AllocationBusiness Strategy & Focus
• Bringing critical services manufacturing
education
healthcare
• Creating jobs quality (not less than 130% above median worker wage)
and accessible (less than 80% AMI)
• Bringing fresh food to urban areas with: industrial disinvestment
poverty concentration
low wage levels
low levels of education
Our application has a focus on funding manufacturing/industrial, health care clinics, fresh food retail and mixed-use transactions that provide workforce training/education services.
Subsidiary Community Development Entities Sub- CDE’s
GROWTH
Controlling Entity
Sub CDE 1
NMTC Project 1
Sub CDE 2
NMTC Project 2
Sub CDE 3
NMTC Project 3
Sub CDE 4
NMTC Project 4
Sub CDE 5
NMTC Project 5
Central States Development Partners, Inc.
For Profit Community Development Entity
CDE Capacity 2012: Expansion of DOT FoodsMt. Sterling, ILProject: $16 MillionPermanent Jobs Created: 50
2014: Facilitation of the Relocation and Expansion of Hill &ValleyRock Island, IL Project: $16 Million Permanent Jobs Created: 45Jobs Retained: 130
2008: CDE Identified Columbia Park Plan as potential for NMTC
From This
To This
Catalytic Impact • Hill & Valley was featured in
Novogradac Journal of Tax Credit’s October 2014 issue
• Brings national attention to a Rock Island project.
• Hill & Valley’s relocation and expansion provides a catalyst for investment of $50 million and the creation of an additional 400 local jobs.
Hill & Valley, Inc.$16 Million Investment in a distressed census tract 25 new jobs, 12 more to be added before end of year 200 employee workforce
Resilience ReportHill & Valley, Inc.
• 10 years ago, LRC Developers group tore down 1 million square feet of old warehouse space and opened 15 acres.
• Of the four original buildings still standing, three were filled by Hill & Valley.
• The rest of the property was cleaned up for future development, including a 10-acre sale three years ago to the Metro Link system as a maintenance facility, a $36.1 million investment
• MetroLINK maintenance facility now considered a national model for replication nationwide for transit maintenance facilities.
$51 Million in new
investment since 2014
Resilience ReportHill & Valley, Inc.
• NMTCs played a key role in the $16 M development
• New bakery, office and warehouse into 136,000 sf operation space for Hill & Valley, creating a boon for the company, and a huge lift for its hometown, Rock Island.• It kept a local company and allowed it to grow.
• It created jobs (50+)
• Gave the company the ability to make the product in a more efficient layout and with more testing equipment.
New Market Tax Credit Timeline
Q2:
New Market Tax Credit Forum hosted in downtown RI
2015-2016 Rounds combined for a total $7 billion available
Q3:
5 sub-CDE’s created
Q4:
Announcement
238 applicants requesting $17.6 billion
Note: officials have been working to distribute NMTCs across the US, including “underserved states” that have received the least NMTC allocation in
proportion to their population living in low-income communities.
If Application is Funded= DARI’s loan to be paid back in full ($20,000) Approved at November 2015 board
90 Day Impact
Support job creation and economic growth in low and-moderate-income communities and underserved areas by:
• Providing community-based lending and investment;
• Leveraging public and private investment for economic and community development;
• Fostering the creation and preservation of low-and-moderate-income housing for low-and-moderate-income households.
• Seeks to empower individuals, businesses,and cities through its financial programs.
• Assists the emerging economic needs of communities.
Support Local Businesses. Create Jobs. Change Communities.
Structure
Rock Island Economic Growth
Corporation
Bridge Investments
Management Agreement
• First 90-days operations:
• Governance: • Board of Directors • Nine banks• Two for-profit businesses• One non-profit
• Raised $465,000 in capital
• Increased Asset Base by an additional $150,000
• $3,780,000 in forward commitments
Neighborhood Reinvestment Fund
Neighborhood Reinvestment Fund$1,600,000
Neighborhood Reinvestment Fund
• $1.6 Million in forward commitments for initial phase
• The Neighborhood Reinvestment Initiative allows: • Purchase• Renovate• Sell neglected homes
• Bi-state region of Iowa and Illinois• Rock Island County • Scott County• Whiteside County
• The effort will result in creating sustainable homeownership and wealth building opportunities for local families
Loan Activity
$2,574,000 in forward commitments
Loan Activity
Neighborhood Housing Services- Davenport, IA: •Single Family Redevelopment•$394,000 loan approval•$30,000 bridge financing •$2,002,638 leverage•15.6 jobs supported•4 units of housing stock improved•4 new homebuyers
Loan Activity
• Coatsworth Apartments- Galena, IL:
• Preservation of senior, multi-family, mixed use development in a rural/ underserved county
• $75,000 loan approval
• $1,285,000 leverage
• 15.31 jobs supported
• 18 low income rental units
• First Floor Commercial Space
Loan Activity
Zimmerman Lofts- Rock Island, IL:•Low Income Housing Tax Credit Residential Development •$1,850,000 loan approval
Bridge lead lender through participation agreements•$10,339,428 leverage•137.25 jobs supported•25 new jobs created•45 total housing units, of which 89% will serve residents earning at or below 60% Area Median Income. •First Floor Commercial•Addressing housing and business needs in a low-income, distressed census tract
Loan Activity
Downtown Business- Rock Island, IL:•40-year old business located in low-income, distressed census tract•$100,000 loan approval•$150,000 leverage•2.81 construction jobs supported•40 permanent jobs supported
Loan Activity
Rock Island Economic Growth Corporation- Rock Island, IL: •Patient Capital Utilizing a Development Agreement•$125,000 loan approval•$2,104,210 leverage•25.10 construction jobs supported•8 residential units with first floor commercial space•Addressing housing and business needs in a low income, distressed census tract
Resilience Report 90 days of activity
75
housing units
261.07
Jobs supported/
retained
$15,881,276 Leverage
Comprehensive Economic Development Plan for the Region
Community Benefit Agreements$500,000- potential
Community Benefit Agreements
HUD 108: Revolving Loan Fund$5 Million • State Wide Program
• In partnership with HUD and the DCEO
• The preferred concept would need to be lending for very secured transactions, with emphasis on tax credit secured or other collateral in a senior position.
Revolving Loan Fund: AG/ NSP Program Income
$300,000
• Launching 1st Quarter 2017
Economic Growth
Corporation
Bridge Investment CDC
Development Association of
Rock IslandThe District
Central States Development
Partners Inc CDE
Comprehensive Approach to Community Revitalization
Thank you!
Beth Payne
Administration Director
Renaissance Rock Island
100 19th Street, Suite 109
Rock Island, IL 61201
309-788-6311
Brian Hollenback
President/ CEO
Renaissance Rock Island
100 19th Street, Suite 109
Rock Island, IL 61201
309-788-6311