Historic Strand Hotel – Chicago,
In October, we represented Holsten Real Estate Development Corporation in the closing of its development financing for the acquisition and rehabilitation of the Strand Hotel. Originally built in 1914-1915, the Strand Hotel is located near the corner of Cottage Grove and 63rd Street in Chicago. The City of Chicago donated the hotel as part of the transaction in exchange for various redevelopment covenants.
Upon completion, the Historic Strand Hotel will be a mixed-used development consisting of a five-story residential building with 63 residential units, 3 ground floor commercial units and an ancillary parking lot. Of the 63 residential units, 9 will be market-rate units, 53 will be low-income housing tax credit units, and 1 unit will be reserved for a manager.
Alliant Capital, Ltd. is providing the LIHTC equity for the project, which resulted from a City of Chicago allocation of nine percent credits. In addition, the historic rehabilitation will also generate federal historic tax credits and Alliant is providing equity in connection with such historic credits. Other sources of the financing for the acquisition and rehabilitation include (i) a construction/equity bridge loan from Citibank, N.A.; (ii) a HOME loan from the City of Chicago; (iii) a loan to the project entity by Holsten Real Estate Development Corporation of State of Illinois DCEO funds provided to it as a non-shareholder capital contribution; (iv) a loan to the project entity by Holsten of City of Chicago TIF funds also structured as a non-shareholder capital contribution. The City also allocated State of Illinois donation credits to the transaction and the City’s syndication of such State of Illinois donation credits, as facilitated by Alliant Capital, Ltd., generated additional equity for development costs.
Milwaukee Avenue Apartments – Chicago, Illinois
Earlier this month, we assisted Full Circle Communities, Inc. in its closing on the tax credit and other financing to develop the Milwaukee Avenue Apartments at 3064 North Milwaukee Ave. in Chicago. The formerly vacant, foreclosed site in the Avondale neighborhood will be redeveloped into a four-story, 32 unit apartment building. All 32 units will be barrier-free units, fully-accessible for persons with disabilities. Through Full Circle’s partnership with the service provider, Over the Rainbow Association, all tenants will receive supportive housing services.
The $9.7MM development is being financed by LIHTC equity syndicated by National Equity Fund, which resulted from an Illinois Housing Development Authority allocation of nine percent credits. The layered financing for Milwaukee Avenue Apartments also consists of (i) construction and bridge financing from Bank of America, N.A.; (ii) a grant by IHDA of permanent supportive housing funds; (iii) City of Chicago TIF financing; and (iv) State of Illinois Department of Commerce and Economic Opportunity funds. The Chicago Housing Authority will also provide operating subsidies for 11 of the units.
We are proud to be a part of Full Circle’s development team for this exciting project.