PARTNERSHIP BRINGS 9 HISTORIC BUILDINGS IN OLD NORTH ST. LOUIS BACK TO LIFE FROM BRINK OF COLLAPSE

In an unprecedented collaboration among three non-profit organizations, the Old North St. Louis Restoration Group, The Regional Housing & Community Development Alliance (RHCDA), and the Forest Park Southeast Development Corporation have created a partnership that is restoring historic buildings and creating high quality, affordable housing in two separate neighborhoods. The Coalition of Neighborhoods Effecting Change Together (CONECT) project is achieving a dramatic transformation in the core of the Old North St. Louis neighborhood by rehabilitating nine vacant and dilapidated historic buildings to produce 32 attractive apartments. Before work began in September of 2005, several of these buildings literally were crumbling into the street. (see the gallery of "before" pictures). Without the CONECT project, they would have completely collapsed, leaving the neighborhood with more vacant lots in the place of architecturally significant brick buildings.

The nine Old North St. Louis buildings being preserved are at 2315 N. 14th; 2213 Blair; 1423, 1424, 1436, 1440 and 1454 Monroe; 1211 and 1304 North Market. In addition to the 32 apartments in Old North St. Louis, the project will result in 27 renovated apartments in Forest Park Southeast.

The organizations representing each neighborhood were working with RHCDA to find financing for their next residential development projects but were facing substantial financing challenges. Thanks to the creativity and determination of RHCDA's development experts, especially deputy director David Dodson, the development team crafted an innovative financing structure; by combining the two separate historic rehabilitation projects into one financing package, the CONECT partnership was able to achieve the economies of scale necessary to make tax-exempt bond financing for the projects feasible.

According to Dick Murray at A.G. Edwards, "This has been among the most sophisticated transactions that I have seen in my experience at A.G. Edwards and we are proud to have been a part of the financing team."

The financing involves eleven sources of funds to produce a $14 million total investment in the two neighborhoods. In addition to tax-exempt bonds, the financing also includes Federal and State Workforce Housing Tax Credits, Federal and State Historic Preservation Tax Credits, State and City HOME funds, City of St. Louis Affordable Housing Trust funds, a Missouri Affordable Housing Assistance Program (AHAP) tax credit-eligible charitable contribution from U.S. Bank, and a Danforth Foundation Grant.

RHCDA President Stephen Acree noted that "We have also used just about every available tool at our disposal to make this happen. In the process, we created a unique collaboration with two neighborhood based organizations that are now participating in a single ownership structure that allows the redevelopment momentum in each of their neighborhoods to continue."

Other parties involved in the transaction are:

PNC Multifamily Capital of Madison, Wisconsin is the equity investor funding the Federal Workforce housing Tax Credit capital contribution of $4.6 million. CityScape Capital Group of El Segundo, California (investing for U.S. Bank) is the Federal Historic Tax Credit investor with equity of almost $2.4 million. Horizon Asset Management of St. Louis, Missouri is the State Workforce Housing Tax Credit investor with equity of $1.8 million. Commerce Bank is purchasing the State Historic Preservation Tax Credits associated with the development, resulting in an $1.8 million investment. Enterprise Bank of Clayton, Missouri purchased the Tax Exempt Housing Revenue Bond issued by the City of St. Louis Industrial Development Authority. A.G. Edwards was the Bond Underwriter; Bank of America is providing a Letter of Credit to credit enhance the bonds and Bank of New York is the Bond Trustee. The complexity of the transaction is further illustrated by noting the many roles that RHCDA affiliates play in the development:

1. RHCDA provided "Predevelopment" Loans to Old North St. Louis Restoration Group and Forest Park Southeast Development Corp., a $100,000 Danforth Foundation Grant and $100,000 in restricted Forest Park Southeast grant proceeds to the Project.
2. RHCDA's not-for-profit affiliate, St. Louis Public Development Corporation I ("PDC I") is a Member of the State Historic Preservation Tax Credit Investor Limited Partner.
3. Old North St. Louis Homes, Inc., a for-profit corporation wholly-owned by RHCDA, is the Managing Member of the State Historic Preservation Tax Credit Investor Limited Partner.
4. Park East Homes Corporation, a for-profit corporation wholly owned by RHCDA is also a Member of the State Historic Preservation Tax Credit Investor Limited Partner.
5. Another RHCDA affiliate is the Managing Member of the Federal Historic Preservation Tax Credit Investor Limited Partner.
6. This affiliate is the Managing General Partner of the Limited Partnership that will own the development.
7. This affiliate is also the Managing Member of the Co-General Partner of the Limited Partnership that will own the development.
8. Another RHCDA affiliate is the Managing Member of the developer of the Old North St. Louis Portion of the Project.
9. Another RHCDA affiliate is the Managing Member of the developer of the Forest Park Southeast Portion of the Project.

The Lipton Group will be responsible for leasing and management of the apartments. Monthly rents will be $395 for a one-bedroom unit, $500 for a two-bedroom unit, and $625 for a three-bedroom apartment.