Last updated on July 2nd, 2019 at 10:57 am
First-Ring Industrial Redevelopment Enterprise Inc. and Oak Creek-based Tri City National Bank are launching a $7 million loan pool for federal New Markets Tax Credits projects.
FIRE is a regional Community Development Entity that provides gap funding for mixed-use, commercial and industrial development projects in Kenosha, Racine and Milwaukee counties via New Markets Tax Credits. It was formed in 2007 by the City of West Allis.
Eligible projects for the new loan pool will be in low-income or severely distressed census tracks. In southeastern Wisconsin, that includes most of West Allis, a large portion of Milwaukee, and some areas of Racine and Kenosha, said Bryan Johnsen, vice president at Tri City.
The pool will place an emphasis on projects that support accessible job creation, operating businesses, Brownfield reclamation, and potential “catalytic opportunities” that align with FIRE’s mission.
This is the first loan pool FIRE and Tri City have partnered to administer. The pool has not closed yet, but should have funds available within a month. The maximum loan amount is $2 million, Johnsen said, and the interest rates will be below-market.
“We don’t have any signed commitments, but as far as initial conversations, $4 million to $5 million of people showing interest and having projects that qualify,” he said.
One of the qualifying projects that is expected to receive about $2 million in funding from the loan pool is Mandel Group’s Six Points development in West Allis, Johnsen said.
“We have such a great relationship with the City of West Allis, we have several branches in the city of West Allis, and them being a CDE who we’ve done other tax credit projects with, it seems like a good fit for us to jump in and do our first loan pool,” he said. “We think being a community bank, we have the connections in the communities to use these loans in the correct manner.”
The loans will be awarded to between five and eight projects, and will be administered within the next 12 months, Johnsen said.
Based on the potential participating projects, the loan pool is expected to create 107 jobs.
Tri City has about 22 branches in southeastern Wisconsin and provides personal, business and investment services.