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Creighton redevelopment needs additional $4.9 million from city for first phase
12/09/2017 5:42 PM by John M
From Jeremy Lazarus at the Richmond Free Press:
The project to transform the poverty-stricken Creighton Court public housing area in the East End into a mixed-income development has run into a glitch — the master developer can’t raise all the money needed to construct the first 105 apartments.
[…]
The additional $4.9 million, according to information provided by the city, is needed to cover the cost of developing the first phase of apartments. The total cost of the project is estimated at $30 million, according to city information. [The Community Builders of Boston] apparently only has been able to secure $25 million in tax credits and bank loans.
A developer needs money from the city to proceed with a development? It should not not be the business of the city to subsidize a development.
“Oh, . . . but it’s for the poor!”
It should not not be the business of the city to subsidize a development. If some charity wants to step up, fine. But It is not be the business of the city to subsidize a development.
This has all the earmarks of a Tier I city! NOT
This proposed action by city council has all the earmarks of good fiscal policy by a wanna-be Tier I city. NOT!
A developer didn’t line up financing prior to beginning a project and so Richmond will fill in the empty spots.
At first glance this action seems it could be a huge boon for other developers in the city – except for the city’s policy that a development must show a return to the city on the city’s investment.
In other words, if a development’s going to provide a return to the city (and its taxpayers), that development is SOL.
So Richmond’s already out $8 million and about to donate nearly $5 million more.
What a way to do business….except this isn’t business.
So it’s the city puts up the land, pays to build it, and the developer gets to own it… Where’s everyone who hates the stone deal? At least the city owns that.
So this is supposed to be a “mixed income” development. Given that the location is the same as the current development (that they are trying to “improve”), what buyer with even half a brain would want to live there with all the issues with gang, crime, etc? It’ll end up with just moving the current creighton people down the road to a nice, new development which will be trashed within a year. There still still be a concentrated pocket of poverty in the East End. Richmond City will have wasted more money on another poorly planned project.
Good going Richmond.
Great update. I was wondering what was taking so long for the redevelopment to start.
This may be an opportunity for someone to take the project over! Whoever the biggest financial investor is if they are smart, may be able to auction off the started project to get their money back and it will go to someone who will actually finish it and try to make money.
I guess it is not clear to me from the article that was linked to. Is the developer asking for a $4.9 million dollar loan they will pay back? Or merely a tax credit/grant (aka free money)? While I don’t like either option very much a loan would not be as unfavorable. So it would be beneficial to have greater clarity on this.
Since Richmond lost the grant that was supposed to pay for much of the project because of a carefully considered lack of faith in Richmond’s leadership and RRHA’s leadership as well, why wouldn’t we scale back the project?
The 4.9 mil appears to be a City bailout, with no hope of return, either directly in the form of loan repayment or indirectly in the form of taxes raised.
The article seems to say that the developer wants 30 million American dollars to make 105 public housing apartments…. or $285,000 per unit? Are we really this bad at this?
If the developer has 25 mil, then let them do a 25m Project. Or put up the project for sale and make money so the city can administer or redistribute its existing public housing.
And on that note, a thoughtful documentary from the annals of public housing history:
https://www.amazon.com/Pruitt-Igoe-Myth-Sylvester-Brown/dp/B016VEI2L2
#9 – Richmond suffers from a news desert. To the best of my knowledge, only the Richmond Free Press covered this:
“City Council also voted 7-2 to borrow $4.9 million and provide the money to help with the construction of 60 regular apartments and 45 senior apartments on the cleared grounds of the former school at 1611 N. 31st St.”
http://richmondfreepress.com/news/2017/dec/15/city-council-oks-money-raises-church-hill-north-pr/