Overview
These loans are specifically designed to overcome barriers to the full re-use of abandoned, idled or underutilized commercial and industrial properties. Eligible applicants include private developers and businesses, and non-profit CDC’s (for projects that will pay real estate taxes).
Vacant or underutilized buildings or land with prior commercial, industrial or institutional usage are eligible, if at least 20 years old and 40% vacant for 2 years. The applicant must own the property, have a committed end user, and be current with city and county taxes. “Big Box” or retail mall developments are excluded.
Loans may be used for property acquisition, environmental site assessments, site clearance and demolition, and new construction. Appraisals can be determined by the “as is” or “as completed” property status.
Funding Terms and Levels
This funding is up to 45% forgivable. The 6% loans are made for a maximum of one year. There must be a bank commitment for take-out financing and the City requires a shared 1st priority lein or standby irrevocable letter of credit. The maximum 90% loan to value ratio based on an “as complete” appraisal may be waived with a letter of credit.
| |
HIGH IMPACT |
MAJOR IMPACT |
SMALL BUSINESS |
Total Project Cost |
$10 m+ |
$2m-$9.9m |
up to $2m |
City Funding |
$1,250,000 |
$800,000 |
$500,000 |
Forgiveness |
40% |
35% |
30% |
Green Forgiveness Incentive |
5% |
5% |
5% |
Additional Loan Considerations
- Prevailing wage rates must be paid. Construction projects with total costs of $100,000 or more must comply with MBE/FBE regulations (details)
- Construction projects with City assistance exceeding $100,000 must include Cleveland residents (20% of the total employed) for the construction project, and 4% of those employees must be low-income residents details
- When the total value of City assistance exceeds $75,000 to businesses with 20 or more employees, the wage-only compensation of all employees must be a living wage (currently a minimum of $10.00/hour)
