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Michigan Magnet Fund Wins
$60 million New Market Allocation
Secretary Geithner on October 30th announced that the Michigan Magnet Fund will be awarded a $60 million of New Market Tax Credit allocation for investment in eligible businesses in low income communities throughout the state of Michigan. This is MMF's second award of $60 million. It received its first award in 2005. MMF is also pleased to announce that the Detroit Investment Fund received a $40 million allocation for the City of Detroit and that Great Lakes Capital Fund received an allocation of $28 million for their 4 state region. This is the first allocation for both organizations. When combined with the Wayne County allocation of $50 million this will provide Michigan with investment potential of $178 million. |
Mark McDaniels, President of Great Lakes Capital Fund and Dave Blaskiewitz, President of the Detroit Investment Fund are both members of MMF's five member Executive Committee. MMF is pleased that they were able to provide additional investment to the state. Ted Rozeboom serves as Chair and Mark Morante of MEDC as its Secretary.
It is presently estimated that it we will have a signed allocation agreement by the end of November and MMF can start doing deals. In the meantime anyone interested in a new market tax credit investment should complete the Preapplication and submit it to MMF by either e-mail or snail mail. The Board of Directors will be announcing its selection criteria in the next month. The key priority will be JOBS, JOBS, and more JOBS in that order of priority.
In order to be competitive for the allocation, MMF has agreed to focus on areas with higher distress levels and to allocate 30% of its investment to business ventures. The eligibility criteria will be published on this web page as soon as they are formalized.
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500 Block Obtains
Added NMTC |
The 500 Block Project, otherwise know as the Rowe Building, has received an additional financial infusion from the New Market Support Corporation of $6.885 million. The project ran into difficulty when an atrium, under construction, collapsed and significantlly increased project costs. The City of Flint agreed to increase its HUD 108 Guaranteed Loan to the financing which was then leveraged for a US Bank equity investment into both the New Market Support Corporation and to MMF. The new structure permitted us to take Citizens Bank out of the deal altogether.
The project is an important part of bringing jobs and new investment into Flint's downtown. The project is part of the Governor's Cities of Promise Initiative.
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6 Cities - 6 Historic -
10 Michigan Brownfield -
4 Mixed Use - 1 Rural - 1 Land Development
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MMF Closes
$60 million in 10 Projects
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The Michigan Magnet Fund has closed 10 New Market Tax Credit Projects by allocating $60.0 million of its Qualified Equity Investment. The projects are in 6 cities and include:
1. Clear Water - Grand Rapids a $6.7 Million investment in this historic rehab of the former Water Works building into an office complex. This is Fifth Third Bank investment into the MMF and includes brownfield tax credits in addition to the national and state historic tax credits.
2.920 Cherry St. - Grand Rapids is a $5.8 million investment is the historic rehab of the former Orphanage building into the headquarters of the nonprofit Inner City Christian Federation, a leader in affordable housing development in Grand Rapids. The development is part of a larger privately developed residential project, The project also uses historic tax credits, Brownfield and state historic SBT tax credits. An additional TIF has been approved for the residential development.
3. 500 Block - Flint is a $5.4 million investment into the rehabilitation of these former downtown buildings into a mixed use development. This was a complex project using HUD 108 financing from the city, old building (10%) tax credits, brownfield and state historic SBT tax credits, and a BEDI grant.
4.
Book Cadillac - Detroit is a $10 million qualified equity investment into this $185 million historic rehabilitation of this grand hotel. The MMF investment made it possible for National City Bank to invest $28.0 million in purchasing the losses from the donation of the facade easement to a Conservancy group.
5.
East Forest Arts Project - Detroit is a $3.6 Million into this arts orientated historic rehabilitation development in the city's cultural center. The African-American Art Gallery owner is the qualified low income business receiving the MMF investment. It uses a HUD 108 loan as part of the leveraged investment to National City Bank's NMTC driven equity investment and obtained a brownfield SBT tax credit in addition to the state and federal historic tax credits. |
6. Pere Marquette - Bay City is a $5 million investment by the MMF into this historic rehabilitation of the former railroad station into the City Convention Offices. This project in addition to national and state historic tax credits, obtained state brownfield SBT tax credits. MMF obtained a leveraged loan from a local foundation to leverage the new market tax credit equity investment by Fifth Third Bank.
7. Harbor Shores - Benton Harbor is a $8.6 million investment into a land development company that is redeveloping over 250 acres of land in Benton harbor and as part of total 500 acre, $86 million land development. National City Bank provided the equity investment leveraged by a loan from the Whirlpool Corporation. The investment is being used to acquire the land and put in the infrastructure.
8. Bicycle Factory - Grand Rapids is a $4 million investment into a historic rehabilitation and transformation of this former factory into a mixed use facility. Fifth Third Bank is the QEI investor in MMF. However, within one week of the closing the building was completely destroyed by the largest fire ever seen in the City. It is presently being restructured from a historic rehabilitation to a larger new construction. We expect to know the feasibility of the close by October 15, 2007.
9. Studio One - Detroit is a $5 million investment by Fifth Third Bank in the MMF toward this $18 million project toward a mixed use development in the City's Cultural Center and will provide 128 market rate apartments on land leased from
Wayne State University. This project closed in May, 2007. It also has a state brownfield tax credit.
10. Woodard Station Lofts - Owosso is a $5 million investment using debt leveraged by a loan from Huntington Bank and new market tax credit equity from Fifth Third Bank into the MMF. This project is located in a low income rural community and will receive state and national historic tax credits, state brownfield tax credits in addition to the new market tax credits. |
13 CDEs Pick Michigan for Investment
13 CDEs that selected Michigan for Investment were awarded new market tax credit allocations totalling $883 million. All three Michigan organizations that applied received an allocation. Great Lakes Capital Fund's allocation covers four states. Detroit Investment Fund will focus on the City of Detroit. Wayne County received a $50 million allocation from the stimulus package passed earlier this year.
The list of CDEs receiving an allocation are listed below. We encourage everyone to consider using one of these orgaizations as well as MMF and the other Michigan Committed organizations. The more investment we can attract to Michigan to create jobs, the better it is for new economy of Michigan. A more detailed description with contacts and phone numbers can be found in the attached document.
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| CDEs Listing Michigan as NMTC Investment Location |
| CDEs |
100% Michigan Commitment |
Committed to Michigan + Other States |
CapFund New Markets, LLC |
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$28,000,000 |
Chase New Markets Corporation |
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$40,000,000 |
Consortium America, LLC |
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$80,000,000 |
Invest Detroit CDE |
$40,000,000 |
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Local Initiatives Support Corporation |
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$115,000,000 |
Michigan Magnet Fund |
$60,000,000 |
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National Community Investment Fund |
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$60,000,000 |
National Trust Community Investment Corporation |
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$35,000,000 |
NCB Capital Impact |
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$90,000,000 |
Nonprofit Finance Fund |
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$60,000,000 |
Stonehenge Community Development, LLC |
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$80,000,000 |
USBCDE, LLC |
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$95,000,000 |
Waveland Community Development, LLC |
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$100,000,000 |
Wayne County-Detroit CDE |
$50,000,000 |
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Subtotal Allocation Awarded |
$150,000,000 |
$783,000,000 |
Total Allocation Awarded |
$933,000,000 |
| MMF Target Investment Strategy |
$150,000,000 |
$156,600,000 |
Target NMTC Investment to Michigan |
$306,600,000 |
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