There are groundbreakings, and there are heartfelt groundbreakings — like the one that took place for new affordable housing for seniors in Elgin, Illinois.
“We appreciate every one of you,” Housing Authority of Elgin resident Elizabeth Odumuyiwa, who serves as association president for Central Park Tower, told a crowd of dignitaries during Tuesday’s ceremony. “(We appreciate) what you have done to make our life easier, to be proud that we are living a good life.”
The $33 million project to renovate the 11-story building at 120 S. State St. and construct six-story building next door took intensive, dedicated work from various partners, including program management firm C. Ray Baker & Associates and financing from community development finance institution, Cinnaire, Housing Authority of Elgin CEO Damon E. Duncan said.
The development, a Rental Assistance Demonstration, or RAD, project, will yield 150 affordable housing units and 14 market rate units. Construction is scheduled to be completed late this year.
“A lot of folks here didn’t think it could happen,” Duncan said. “All it took was faith — faith the size of a mustard seed — and you can see great things happen.”
Primary funding for the project came from the Illinois Housing Development Authority’s Housing Tax Credit program and Cinnaire (Cinnaire), who provided $14,459,000 in equity in return for the tax credits. Cinnaire also provided a Tax Credit Bridge Loan in the amount of $10.5 million. Capital Fund Services (CFS), a Cinnaire-family company, worked with Love Funding to secure a mortgage through the U.S. Department of Housing and Urban Development/Federal Housing Administration. Additionally, CFS provided a predevelopment loan for the development. Title work for Central Park Towers was provided by Capital Fund Title Services.
“The relationship between the Authority and Cinnaire proved to be the key factor in our mixed finance transaction. By providing predevelopment funds, title work and ultimately Tax Credit Equity, the Capfund’s total investment proved to be the momentum needed to overcome the many obstacles associated with these kinds of financially complex transactions.”
The Housing Authority of Elgin’s unprecedented RAD development is one of the nation’s largest such projects, according to officials.
The Rental Assistance Demonstration was created by the U.S. Department of Housing and Urban Development (HUD) in order to give public housing authorities a powerful tool to preserve and improve public housing properties and address the $26 billion dollar nationwide backlog of deferred maintenance, according to the HUD website.
HUD Midwest Regional Administrator Antonio Riley touted the benefits of the recently revamped federal rental assistance demonstration project, through which public housing authorities can tap into private funding sources to repair distressed public housing. The Housing Authority of Elgin is embarking on one of Elgin’s largest construction projects in recent memory, Mayor David Kaptain said.
The Elgin City Council approved the project in a 6-3 vote a year ago after discussions, at times heated, about whether the location was appropriate for the new building.
“At the end of the day, the most important thing is that it’s going to create better conditions for the seniors that live here,” Kaptain said.