Overview, Concepts, & Request for Funding. Nancy MacMillan Executive Director

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1 Overview, Concepts, & Request for Funding Nancy MacMillan Executive Director

2 Loyola Development Corporation Summary Loyola Development Corporation s ( LDC ) vision is to cultivate a higher quality of life for the people who live and work in the South End Neighborhood ( SEN") by transforming it into a healthy & sustainable community. Loyola s mission t o a c h i e v e t h i s v i s i o n is to prevent a n d eliminate neighborhood deterioration a n d to promote the social welfare of the community. Our intention to do this is through: re-developing and rehabilitating existing properties; converting vacant/abandoned buildings into viable multi-family and mixed-use properties; creating affordable housing options with diversified residential uses and occupancies; offering affordable rental housing to low and moderate income families; and creating affordable infill housing; and promoting ownership of housing. Business Description Loyola Development Corporation, ( LDC or Loyola ), was created and incorporated in 2007 as a 501 (c) 3, not-for-profit organization, in response to the Saint Anne s Church s desire to see the South End Neighborhood revitalized and transformed into a vibrant community that it was once. Loyola is certified by the State of Connecticut Department of Housing as a Community and Housing Development Organization ( CHDO. ) LDC is currently staffed and directed by an Executive Director, Nancy MacMillan who was hired in December The Executive Director is supported by an 11 Member, Board of Directors with 3 chief officers: Len Mecca, President; Gary O Connor, Secretary; and John Vaz, Treasurer. LDC serves as the catalyst for community development via its partnerships with other local not for profit organizations, its collaborative efforts with the City of Waterbury, and its function as a developer of affordable housing in the South End Neighborhood ( SEN. ) The photo to the left exhibits the Arbor Day project with the Boy Scouts of America in the planting of trees at the River Baldwin Recreation Center. LDC worked with the City of Waterbury that day to recruit volunteers to clean up the street frontage and plant trees and flowers to beautify the neighborhood. Loyola Development Corporation will c o n t i n u e t o function as a real estate developer, community development facilitator, & grants program administrator. 1

3 Community Development Facilitator: LDC participates in organizing volunteer events which support the South End as well as the City of Waterbury. Our collaboration with other not for profits, and our participation on the City s Re-Use Committee Board enables Loyola to promote our projects and programs but also enables us to distribute affordable housing information in larger forums such as the City of Waterbury s Home Expo. Obtaining feedback from the South End Neighborhood Association and local residents provides Loyola with valuable information to create programs to meet the needs of the community. Our Board of Directors consists of several local Waterbury residents and South End residents who contribute valuable insight to the needs and concerns of the community. Additionally, Loyola has the support of our State Representative(s), and the Mayor s Office, who present Loyola with plans for development and frequent feedback as to the potential in our goals and objectives. The Executive Director of Loyola strives to accomplish what is set forth by both area residents and our local and state officials. This fine balance of keeping focused on our vision and mission and keeping in sync with the local residents and governments needs and wants is what makes LDC a unique organization. Real Estate Development: Loyola is a full service real estate developer providing: site control, financial & architectural plans, selection of contractors, financing a n d subsidies, construction management & final occupancy. LDC is currently focused on the South End of Waterbury with potential for expanding in to the greater Waterbury area. Development goals are to achieve multi-family residential development in both new construction and rehabilitation of real property, mixed-use development, and infill housing for promotion of homeownership opportunities. Loyola is currently partnering with the Carabetta Companies to develop 33 units of affordable rental housing along South Main Street and East Liberty Streets in the South End Neighborhood. The construction completion is February This is the first of several developments anticipated for this immediate neighborhood. 2

4 Home Repair Grants: LDC secures subsidies to underwrite loans to implement a Home Rehabilitation Program for existing South End Neighborhood homeowners. With the support from and funding via the Waterbury Development Corporation ( WDC ), LDC administers Community Development Block Grant ( CDBG ) funds to eligible homeowners who meet income requirements and who will adhere to the program requirements. In 2013, Loyola launched their Home Rehabilitation Program with their first project as a prototype for the remaining source of funds. Loyola is currently wrapping up using the 2 nd year of funding and is soliciting for eligible home owners who wish to rehabilitate and winterize their homes. Economic Development Facilitator: Through our new construction and rehab projects, LDC will provide job opportunities to local residents which will spur economic growth overall. Our affordable housing projects will generate affordable rents to tenants, enabling tenants to accumulate more disposal income for basic needs as well as goods and services purchased locally. Community Revitalization Objectives: 1. Sponsor two volunteer Clean-Up/Anti-Blight Initiatives Annually. 2. Establish a Redevelopment District in the South End Neighborhood. 3

5 Real Estate Development and Rehabilitation Objectives: 1. Construction of Liberty Commons is underway; new construction project located at South Main Street which will consist of 33 rental units of affordable housing. Completion projected for February Lease-up commencing with Carabetta Companies as the Management Company. Both Loyola and Carabetta will have offices on the ground floor of the Liberty Commons apartments. 2. Analyze redevelopment of 45 Bond Street. This property is a potential opportunity for a historic rehabilitation project to infuse Federal and/or State Historic Tax Credits in to the project for development financing blending with Low Income Housing Tax Credits and developer equity. 3. Acquire property along South Main Street and Mill Street to develop with affordable housing and parking. 4. Analyze vacant land and South End properties for redevelopment in conjunction with the City of Waterbury s overall development plan. Concept Plan for future Real Estate Development: Acquiring new property for development, and redeveloping our existing property located at 45 Bond Street, and infusing new affordable housing opportunities / options in to the South End Neighborhood is priority for LDC in its effort to develop real estate in the upcoming year(s). LDC has two development concepts which require due diligence, however, are concepts which we are pursuing: Historic rehabilitation of 45 Bond Street and the creation of a Historic District: LDC is investigating the possibility of creating a Historic District within the South End Neighborhood. Since funding for the development of affordable housing becomes more and more scarce, one funding source seems to still be a reliable funding mechanism; State and Federal Historic Tax Credits. Often, vintage properties are left unattended and not redeveloped due to the costs in remediation (asbestos and/or lead clean-up) which drives up the overall total development cost. 45 Bond Street which is currently owned by LDC sits vacant and is deteriorating. There are two thoughts to the future use of this property: 1) demolish it and develop a lower density residential building; or 2) create a historic district for the property and at least two other properties which are within close proximity of 45 Bond Street and work with adjoining property owners to investigate what other properties could qualify as historic structures; and get 45 Bond Street and at least two other properties designated as historic structures by the National Park Service. Funding via Historic State and Federal Tax Credits works wonderfully with Low Income Housing Tax Credits and Home funds. This concept would be further investigated and if valid the process to have 45 Bond Street designated as a historic structure would begin in early The creation of the historic district would begin simultaneously. The CT Trust for Historic Preservation would be 4

6 engaged to work on the feasibility of this concept, and LDC would employ an architect with extensive historic rehab experience in order to get our property designated, apply for historic tax credits, and design a residential district which would address many of the issues in the immediate Bond Street area. The two to three family homes along Bond Street may qualify for grant funds if they are included within this newly created district. Many of the details of this concept still require due diligence, however, for purposes of this concept plan, LDC has included them as a creative way to infuse funding in to the City and to offer additional housing and development options in to the community. Several factors, however, are pending the implementation of this concept: overall development costs; required parking for the proposed residential use; and the willingness of adjoining property owners to work with LDC in the sale or exchange of property which would provide us with additional open space for parking. If parking cannot be acquired for the redevelopment of 45 Bond Street to create 8 to 12 affordable housing units, LDC will also consider the demolition of the building to develop a smaller scale residential housing project, however, costs to remediate and demolish the building and then redevelop the site may not be economically feasible at that time if sources of funding are limited. Acquisition of foreclosed property/tax lien properties for auction: LDC is analyzing the use of several vacant lots along South Main Street/W Liberty Street/ Jewelry Street which could potentially be developed with 50 to 60 small affordable housing units for seniors, and small households with ground floor office space, and limited on-site parking accompanied by accessory land along Mill Street for off-site parking which may satisfy zoning requirements for parking for residential use. The distance between the main developable site along S Main and the accessory land along Mill Street slightly exceeds the 500 linear foot requirement for accessory parking. LDC will meet with the City Planning officials, and prepare preliminary plans or maps to see comprehensively, what will be required for this proposal. LDC will need a special permit to allow for the creation of a parking lot. Additionally, residential zoning for one of the lots may need to be changed to commercial zoning for off-site parking, this is in addition to the variance required for its distance from the main site. As soon as the City sets forth a process of acquiring these lots, LDC will move forward with the City to acquire the lots in question and in the next few months will commence pulling together a development team and sourcing financing for this new construction project. LDC has already had conversations with the Hispanic Coalition who would like to pursue a collaboration in developing the site. The Hispanic Coalition would assist LDC in the sourcing of funds for the project, in exchange of permanently occupying office space on the ground floor of the building so that this organization could provide social services to the residents of the building where needed. The presence of Loyola, Carabetta, and the Hispanic Coalition within very close proximity of each other will be a very strong and stabilizing presence for the South End. St. Vincent DePaul already has housing within the immediate block, adding to the positive impact which is anticipated. 5

7 LDC Achievements: 1. Real Estate Development. Loyola Development Corporation had acquired 4 parcels of land located along South Main Street, East Liberty Street, and Bond Street to develop 33 units of affordable housing. The previous improvements have been demolished, the site has been cleared, and the soil management plan had been revised to efficiently and economically prepare the site for construction. Financing was successfully completed with the use of Low Income Housing Tax Credits, Home Funds, and developer equity. The developer partnership between Loyola Development Corp. and the Carabetta Companies was created with the intention to successfully complete this project within budget and under the required time allocated for this construction. Construction completion is projected for February Leasing is underway. 2. Housing Rehabilitation Program: LDC has been awarded CDBG funds from the Waterbury Development Corporation to administer funds to low income home owners to create safer, better maintained, and more energy efficient homes in the South End by allowing LDC to provide loans to low income homeowners to rehabilitate their homes. The program is still evolving since this is a newly created program and a first in the City of Waterbury as well as a first for Loyola. The home owners are typically selected based upon their income eligibility. The City of Waterbury assists in the biding process to solicit eligible general contractors to work on the homes. The construction manager oversees the process from start to finish and is qualified in construction and the overall funding process. Contracts for this program were specifically tailored for this program with both English and Spanish versions of the agreement between the home owner and the contractor. It has been imperative that the home owners know exactly what is required of them as a mortgagee and the contractor understands its obligations as a vendor and recipient of funds. LDC launched this program in August LDC is recruiting eligible homeowners and soliciting eligible general contractors for this program. 6

8 Organization, Management, & Personnel Projection: LDC is governed by an 11 member Board of Directors. (See the next page for list of Board of Directors.) LDC s sole employee is the Executive Director, Nancy MacMillan, who is real estate professional with over 25 years experience in real estate including experience in commercial real estate appraising, LIHTC syndication, affordable housing via government planning, affordable housing development, and affordable housing advocacy. LDC has sought strategic partnerships with public & private entities and contracted out professional services to meet its current objectives, and will be adding an executive assistant or project manager to its staff by the first quarter of Other objectives include the hire of a construction manager for our Housing Rehabilitation Program, a part time book keeper/office manager, and a temporary intern who may learn about real estate and community development and assist LDC in the everyday managerial and accounting functions of the organization. The goal is to allow LDC to become self-sufficient via the income derived by its first development project and via grants which will allow LDC to leverage funds generated by programs. Future collaborations with other not for profits such as the Hispanic Coalition will allow LDC to stabilize its organization, support its tenants in their rental properties, and expand its services to South End residents. 7

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10 Financial Plan: Loyola maintains a standard of lean efficiency. Loyola hired its first Executive Director in December Since 2009, the ED has been awarded various grant funds to establish a presence in Waterbury and commence revitalization of the South East Neighborhood. To date these resources have been used to pay for general administrative and operating expenses; to hire a consultant to draft the neighborhood revitalization strategy; to develop materials for the implementation of a Home Repair & Rehabilitation Program; to acquire properties for purposes of future development; to retain the services of professional consultants to ensure future project and program success, and to cover employee salary and benefits. The current Executive Director, Nancy MacMillan, was hired in December Since that time, she has continued all of the above with her focus on prioritizing the organizations activities, working with our consult and housing development team to reconcile activities associated with the South Main East Liberty Apartments (renamed as Liberty Commons), meeting with the City of Waterbury and local organizations in order to establish new business, preparing reports to past funders, moving the office to its new location, and creating new initiatives. Working to complete financing on the Liberty Commons project took quite an effort to secure low income housing tax credits with the Connecticut Housing Finance Authority ( CHFA ) and Home Funds with the Waterbury Development Corporation ( WDC ), as well as, securing 20 Project Based Vouchers with the Waterbury Housing Authority. Nancy works continuously on the Liberty Commons project through its construction to ensure design standards are met and the project runs smoothly through this period, with construction completion estimated for February At the same time, Nancy is assisting with promoting leasing of the project, and working in the community with Loyola s Home Repair & Rehab Program. Nancy participates in City sponsored events to maintain relationships with lenders, local government, other like-minded organizations, and the community. Administrative and Operating Expense: In FY 2012, the previous Executive Director of Loyola had anticipated that we would apply for a Community Housing Development Organization (CHDO) grant from the City of Waterbury; utilize some of the set aside for administrative and operating expenses from the CDBG grant award for the Home Repair Program to cover LDC administrative expenses for FY 2013 and 2014, including the salary of the ED; and the hiring of a full or part time employee. Due to the delay in closing on financing for Liberty Commons and to the delay in collecting developer s fee on the project, this previous projection was not realized. At this time, we have a gap of approximately $70,000 to sustain Loyola s operations until the end of February 2015 when construction will be completed. On the next page is an outline of expenses from this month through February

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12 Predevelopment funds received from the State, and grants received from LISC and the Connecticut Community Foundation were used to pay for the services of the financial consultant, The Housing Development Team, a development consultant that was contracted to establish the financial feasibility of the South Main/ East Liberty Apartment project and preparing the CHFA LIHTC application to support the project development. These two grants have been totally expended and Loyola has successfully reported to these agencies and satisfied the grant obligation. The previous NVDC grant has been expended and was utilized for administration and operating expenses. The EDI grant from WDC is specifically for the construction and site work of Liberty Commons. These funds have paid for environmental studies and site work as well as for demolition of the prior site improvements. CDBG funds are specifically for the Home Repair and Rehabilitation Program and staff time spent specifically on that program. At this time, Loyola Development Corpration is requesting a sum of $70,000 to assist us with general adminsitration costs which will enable us to get to consyrction completion, and stabilize our operations until we build greater capacity. Five Year Projections for Administration and Operations: Moving forward, Loyola will work toward becoming a self-sustaining entity through the implementation of its project and programmatic objectives. Administrative and operating expenses will be paid through fee earned from administering the Home Repair and Rehabilitation Program, and via our developer s fee earned by developing Liberty Commons, in addition to any revenues associated with the development or sale of residential properties which LDC plans on acquiring and developing in the near future. 11