LANCASTER – CT/KDF Community Development Partners has placed $16.15 million of its New Markets Tax Credit allocation with a subsidiary of InSite Development to be used to redevelop four properties along the The BLVD.
This third phase of redevelopment involves the acquisition and redevelopment of an office/retail building, conversion of a former church into a community building for the City, new construction of a retail/office building, and new construction of a downtown parking structure.
In addition, solar photovoltaic panels will be installed on several neighboring multifamily properties, and more than $6 million of street and traffic improvements will be completed as part of the city’s plan to create a downtown Lancaster destination.
The project is being completed in close coordination with the City of Lancaster and is designed to fulfill the goals of community revitalization and blight elimination, as well as the creation of an attractive destination and a walkable, safe downtown.
A crucial aspect of this project is InSite’s commitment to invest in locally-based, resident entrepreneurs who create and own their own businesses that service and employ the immediate community. This local “incubator” technique has proven very successful in the first two phases redeveloping The BLVD. Phase three will also feature numerous executed leases with resident entrepreneurs who work closely with InSite in design, execution and operation of the local business.
Businesses that have opened along The BLVD include an authentic Jewish deli, a family-style restaurant with an underground bowling alley, a cupcake shop, yogurt shop, candy store, clothing boutique, and a state-of-the-art movie theatre.
CT/KDF’s financing of The BLVD was generated through the company’s New Markets Tax Credit (NMTC) allocation from the federal government. CT/KDF received $90 million in late 2006 from the Community Development Financial Institutions Fund (CDFI) of the U.S. Treasury Department for investment in distressed areas.
“The federal New Markets Tax Credit program is targeted toward investment in new construction or substantial rehabilitation of properties in low-income areas,” said Sarah Woodward, chief investment partner for CT/KDF. “Compared to conventional, market-rate financing – especially financing for distressed areas – NMTC money is very attractive and may be the only financing available for a worthy project in a lower-income neighborhood.”
The Lancaster financing is CT/KDF’s seventh transaction using its NMTC allocation, and successfully completes the company’s initial deployment of its original NMTC funds.
CT/KDF Community Development Partners, a joint venture between CT Realty Investors and KDF Communities provided the financing in concert with its investment partner, U.S. Bancorp Community Development Corp.
(Information via press release from CT/KDF Community Development Partners.)