New Markets Tax Credit News Briefs – April 2018

Monday, April 9, 2018

Enterprise Community Partners (Enterprise) and JPMorgan Chase (Chase) announced development plans Jan. 25 for the Greenpoint Manufacturing and Design Center (GMDC) Ozone Park Industrial Center in Queens, N.Y. The plan with GMDC will transform an 88,500-square-foot historic former bicycle factory into 25 rental units. There will be affordable workspaces for 25 small businesses, which will create 80 permanent jobs. Financing includes $10.5 million in new markets tax credit (NMTC) equity, with the NMTC allocation of $10 million from Enterprise, $17 million from the New York City Economic Development Corporation and $4 million from Chase Bank. In addition, Enterprise Community Loan Fund, a national community development financial institution (CDFI) and a subsidiary of Enterprise, will provide an $8.7 million loan with the participation of CDFIs Nonprofit Finance Fund and the Local Initiatives Support Corporation. The city will provide $3.7 million in subordinate debt financing, as well as a $10 million grant as part of New York City Mayor Bill de Blasio’s Industrial Developer Fund. New York state agency Empire State Development awarded a $2.1 million grant. Construction is scheduled to be complete in early 2019.

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The Economic Report of the President was released Feb. 22. The report discusses the importance of programs that drive private investment into distressed communities and specifically mentions the new markets tax credit (NMTC) as arguably the most successful of those programs. The White House report goes on to discuss the opportunity zones tool created under the new tax law in December. The program offers a tax deferral for up to nine years on gains that are invested in qualified opportunity zone funds. The report is available at www.newmarketscredits.com.

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Maui Electric Company announced in early February plans to buy electricity from a potential grid-scale solar and battery energy storage facility in Moloka‘i, Hawaii. The development of the 2.7-megawatt project, to be built by Moloka‘i New Energy Partners, is pending an NMTC allocation. If approved, the facility is expected to be in service by the end of 2019 and would include a 3-megawatt battery energy storage system.

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Developers broke ground Feb. 19 on the rehabilitation and expansion of the former Bohn Motor Company 1920s building in New Orleans. The 41,000-square-foot facility will be the site of Odyssey House Louisiana, an organization that provides low-cost medical and behavioral health care. Work on the $14.4 million project is expected to create 45 new permanent jobs. Enterprise Community Investment and Goldman Sachs provided the NMTC allocations, with additional financing provided by the Louisiana Office of Community Development, the New Orleans Redevelopment Authority and the Reinvestment Fund, with historic tax credit equity investments made through Twain Financial Partners.

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Commonwealth Cornerstone Group announced Feb. 16 the closing of a $10.5 million NMTC transaction for the construction of a four-story building in Philadelphia. New Market West will be a 135,700-square-foot building on a 1.5-acre vacant lot. The development is a joint venture between Mission First Housing Group and Horizon House. There will be early childhood education for 130 infants, toddlers and preschoolers. The remaining space in the new building will be used for community events and ground-floor retail. In addition to NMTC financing, New Market West received a $5 million grant from the Commonwealth of Pennsylvania’s Redevelopment Assistance Capital program and tax credits from Philadelphia Industrial Development Corporation, PNC Community Partners and Cinnaire New Markets. Construction is expected to create 120 temporary full-time construction jobs and 94 full-time permanent jobs, while retaining another 263 full-time jobs. 

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The ribbon cutting for XS Tennis Village was March 3. The $16.9 million development was built with $7 million in NMTCs from the National Community Investment Fund, a $2.9 million tax-increment-financing subsidy, private loans and foundation grants. The center, which had a prior soft opening, includes 27 indoor and outdoor tennis courts, a 10,000-square-foot gym and a 5,000-square-foot academic center with training space and classrooms. XS Tennis provides free tennis for 2,000 Chicago public school students through its portable, in-school Tennis XSpress program. The center is expected to double the number of participants and pave the way for XS Tennis to extend $300,000 in scholarship-based instruction to Chicago residents and students. Fifty jobs were created or retained.

Journal Category: 
New Markets Tax Credit