So what exactly happens when mission-based nonprofits partner with for profit institutions? Check out our selection of stories on the transformational impact that the New Markets Tax Credit has had in communities around the nation.
Leonard Florence Center for Living (Chelsea, MA)
The Chelsea Jewish Foundation focuses on enhancing the quality of life for elders and people with disabling conditions, and wanted to develop a nursing home using The Green House model, an innovative approach towards skilled nursing care. It identified a site in Chelsea, a working-class suburb near Boston, and undertook a major capital campaign to finance building costs, but the size of the project and the decline of the stock market made it impossible to raise the entire amount. Moreover, banks were not interested because its specialized nature and location in an economically distressed area resulted in an appraised value far less than total development costs. The project faced a $15MM financing gap.
NCBCI filled the gap and reduced the project’s overall costs by structuring a $14.55MM NMTC investment, sharing the $30MM project with a second QEI from Massachusetts Housing Investment Corp.
The completed 92,000-SF facility consists of a café, bakery, hair salon, chapel, and 10 small living areas (or, “houses”) for residents that build a sense of community, while eliminating the institutional feel of a traditional skilled nursing facility. Half of the houses are designed for elderly residents; three are dedicated for short-term rehabilitations following surgery or other hospital stays; and the balance is for younger individuals with multiple sclerosis or Lou Gehrig’s disease (ALS), for which innovative technologies will be used to enhance their quality of life. Because the NMTC financing significantly reduced the Center’s ongoing financing costs, the Center is able to serve a much lower-income population; half of the Center’s patients are eligible for Medicaid.
IMPACT
Profiles of some of the Center’s residents, including information on the impact the Center has had on their lives, can be found here: http://www.leonardflorencecenter.org/Our%20Communities/lfclsite/profiles.html
LifeLong Medical Care (Berkeley CA)
LifeLong Medical Care’s West Berkeley Family Practice Clinic provides primary care and behavioral health services to approximately 7,200 patients annually, of which 90 percent live below 200% of the federal poverty level. Yet the clinic space could not adequately accommodate all patients (serving an average of 123 patients daily in an area designed for 80), nor did it meet seismic standards. Capital Impact, working with the Northern California
Community Loan Fund, the Calvert Foundation, Partners for the Common Good and JP Morgan Chase, allocated $10.3 million in New Markets Tax Credits to renovate the existing historic building and construct a new three-story annex. The clinic anticipates creating 23 new full-time positions and 50-70 construction and temporary jobs. Patient capacity is expected to increase to 10,300 annually with projected patient encounters of 47,000.
IMPACT
“My husband had had a side ache for awhile and…I felt like his doctor wasn’t listening, so I suggested that he go to LifeLong. He was 58 years old, and it seemed to me that he shouldn’t have those types of symptoms. It turned out my husband had stage four cancer. If it wasn’t for [LifeLong’s doctor] and the fact that she listened, we never would have known. He only lived another few months after that, but they took good care of him, and they took care of me while he was in hospice and in the last stages of his life.” —A West Berkeley Family Practice Clinic patient
Equitas Academy (Los Angeles, CA)
Capital Impact partnered with ExED, US Bancorp Development Corporation, Pacific Charter School Development, CCSA California Charter Building Fund and Equitas Academy Charter School to secure $8.9 million in New Markets Tax Credits to renovate Equitas Academy’s existing building and nearly double capacity to 450 students. Located in the low-income Pico-Union community in central Los Angeles, Equitas Academy provides K-5 education with the goal of preparing students for college-preparatory middle and high schools. Nearly all students qualify for the free- or reduced-price lunch program and 62% of students are new English speakers. Approximately 92% of students are Hispanic. A high-performing school, Equitas met California’s requirements for Annual Yearly Progress in its first year of operation, with an Academic Performance Index score of 870, higher than the state average.
IMPACT
Malka Borrego, executive director of Equitas Academy, grew up in the Pico-Union neighborhood. A strong advocate for her students, she ensures that all of them—even kindergarteners—are in school every day. Although many students’ families travel to Mexico during the year, she stresses the importance of attendance and parental involvement—insisting that parent-teacher conferences take place, even if it means conducting ad-hoc meetings when parents come to pick up their children to make sure they understand the progress of their children’s education
The Auburn (Detroit, MI)
The Auburn is a 56,000 square foot mixed use commercial and residential development in the heart of Midtown Detroit that has transformed a formerly vacant property into a neighborhood hub. It provides 46 market-rate and 12 affordable housing units for the area’s young professionals and students, as well as 9,100 square feet of quality retail space with tenants such as an independent book store and a Thai restaurant. Capital Impact provided a $3.7 million leverage loan that helped make possible this $8.4 million NMTC transaction.
IMPACT
“Living in the Auburn became a driving factor in my [moving back to Detroit from New York City]. I knew living in a beautiful new apartment in an exciting, walkable neighborhood would help me transition. Midtown is so dynamic—there is always something new and exciting popping up. I really think residential development like the Auburn will help drive the kind of growth we’ve come to expect in the neighborhood.” —Erin, Auburn resident
Recovery Café (Seattle, WA)
Recovery Café is a nonprofit support center in a distressed area of Seattle that uses a therapeutic community model to support those who are seeking a life free from drugs, alcohol and other destructive behaviors. NCBCI provided a $10.3MM QEI to secure a new, permanent location for the Café in downtown Seattle, increasing their capacity to serve some of Seattle’s most vulnerable residents.
IMPACT
Many of Recovery Café’s members have made their stories available online at the Café’s website: http://www.recoverycafe.org/community/member-stories
The Argonaut (Detroit, MI)
Renovation of the 760,000SF, previously vacant Argonaut building in Detroit which now houses a college, charter school, design company, and others– has been a major contributor to reinvestment in the city’s New Center commercial district. New Center was negatively affected by the decline of the auto industry and the loss of jobs and economic growth that followed, and several of the buildings in the area were vacant for decades.
Today, the Argonaut Building houses a charter high school (the Henry Ford Academy), the College for Creative Studies (CCS); a creative business incubator offering office space and services to start-up ventures; and office/retail space. The building houses approximately 300 students, a watch maker that hires and trains local residents, a bicycle workshop and a cafe.
In addition, under the New Center Economic Development Plan, Argonaut’s redevelopment has helped spark new business and development. For instance, a joint program between Wayne State University, Henry Ford Health Systems, and the Detroit Medical Center offers incentives to encourage an influx of residents and business into the area. Since 2011, the community has seen significant new investment, including the rehabilitation and/or re-use of 7 buildings and the conversion of under-used hotel space into suites and apartments. Of particular significance are new commercial developments recently completed, including the University Preparatory Academy, the Detroit Children’s Museum, and the state-of-the-art NextEnergy Building as well as smaller investments by small business owners and developers.
IMPACT
The impact of this project can be experienced through two excellent videos:
http://www.shinola.com/journal/homage-argonaut-building#
Weaver Street Market (North Carolina)
Weaver Street Market is a large cooperatively-owned grocer that operates two stores in distressed areas in Carrboro and Chapel Hill (NC). NCBCI provided leverage financing as part of a $7.0MM in NMTC transaction to support the purchase and development of a third healthy food retail site, and to develop warehouse capacity that allowed the market to provide healthy, freshly-prepared foods to customers at all of its stores. Weaver Street invests in its local community by working with local farmers, seeking out Fair Trade products, supporting local producers and undertaking numerous environmental initiatives.
IMPACT
“The main benefit we derive as owners of WSM is having a thriving, cooperatively owned food market that makes our community a better place to live, builds our local food system, and keeps profits in our community.” — Weaver Street Community Market Board of Directors
CDFI New Markets Tax Credit Alliance 