|HUD Reg. VI: 13-09
Patricia Campbell/Scott Hudman
(817) 978-5974/(713) 718-3107
March 29, 2013
DALLAS RECEIVES $11.75 MILLON HUD LOAN GUARANTEE FOR ECONOMIC AND HOUSING DEVELOPMENT
Funds Will Create Jobs and Support Growth
FORT WORTH – The U.S. Department of Housing and Urban Development today announced the approval of an $11.75 million loan guarantee to the City of Dallas, which will help provide needed housing, jobs, and economic development in the central business district. The grant will assist the Hamilton Atmos Limited Partnership with rehabilitation cost associated with converting the vacant buildings of the Old Historic Atmos Gas Building into housing and retail space in downtown Dallas.
HUD is providing the loan guarantee assistance under its Section 108 Loan Guarantee Assistance Program which enables local governments to borrow money from private investors at reduced interest rates. In return, local governments pledge current and future Community Development Block Grant (CDBG) allocations to cover the loan amount as security for the loan. Over the years, Section 108 guarantees generally have generated $4 of private investment for every $1 in Section 108 guarantee.
Atmos Lofts- Phase II is the focus of the effort and is a mixed use, mixed income development. The conversion will result in the creation of 123 rental units, and 51% of them will accommodate moderate income people and families. In addition to housing, over 9,500 square feet of retail space will be created as well as parking facilities. Phase II will assist in turning two nonproductive, vacant buildings into a vibrant part of the City. The Section 108 investment was made possible by a $12,882,500 FHA Section 221(d)4 Insured Loan for the rehabilitation of the Atmos Lofts, which provided the anchor investment for the overall revitalization effort.
"HUD’s Loan Guarantee Program can be a powerful public investment tool that provides for economic development in underserved areas," said HUD Acting Regional Administrator Mark Brezina. "The program is specifically designed to help cities find solutions for their particular needs. These funds help the City of Dallas maintain revitalization efforts and provide housing and jobs for residents who need them most. Added with a $12.9 Million FHA loan, HUD is very happy to assist an effort that is positive for the City of Dallas and its citizens."
Section 108 loans are not risk-free, however; local governments borrowing funds secured by this loan guarantee program must pledge a portion their current and future Community Development Block Grant (CDBG) allocations to cover the loan amount as security for the loan. The loan must be re-paid within 20 years.
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