PROVIDENCE – Two parts of the state financing package needed for the proposed redevelopment of the Industrial Trust Co. building were recommended for approval through a vote of the R.I. Commerce Corp. Investment Committee on Monday.
The subcommittee voted unanimously, 3-0, to recommend approval of $15 million in tax credits through the Rebuild Rhode Island Tax Credit Program and $5.7 million from a financial incentive program called the First Wave Closing Fund. The recommended requests for financing sought by the building’s owner, High Rock Development LLC, are now going to be put up for final approval before the full R.I. Commerce Corp. board of directors, at a public meeting scheduled for May 11 at 5 p.m.
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These programs represent two of a dozen public and private funding sources that are being used to finance the proposed $220 million renovation of the 111 Westminster St. property, known commonly as the “Superman” building. Together, they account for 9.3% of the funding for the project.
A representative for R.I. Commerce said in an email that the state funding offered through the agency involves repayment provisions.
“The state may receive a portion of operating cash flow if the project performs especially well,” Adam Isaacs-Falbel said in an email to Providence Business News. “Such payments will continue for a minimum of 12 years, even in the event of a sale. Additionally, if the project performs well above market, there are further repayment provisions in the case of a sale.”
The total anticipated project cost is $223.1 million. The project aims to create 285 or more residential units, along with 8,000 square feet of office space, and a mix of retail, event and community space that encompasses 26,000 square feet of the building’s ground floor banking hall.
R.I. Housing also operates two state programs that are supporting the proposed financing package, including the R.I. Housing Workforce Housing Funds, providing $4.5 million, and the R.I. Housing Acquisition and Revitalization Program, providing $1 million.
The city of Providence and the Providence Redevelopment Authority are also involved with the public-private financing package. Although not yet approved by City Council, but signed off on by Mayor Jorge O. Elorza, Providence is expected to chip in $5 million in city funds, and the Providence Redevelopment Association is expected to provide a $10 million loan with 1% interest for 40 years.
The federal government is expected to provide $22.04 million in historic tax credits and $2.1 million through the New Market Tax Credits program, according to the financial term sheet for the project.
The nonprofit Rhode Island Foundation also agreed to provide the developer a bridge loan of $15 million commencing at the issuance of a certificate of occupancy for the building, with a 1% interest rate.
High Rock Development recently said it hopes to commence the redevelopment of the 428-foot-tall “Superman” building in five to six months, first by conducting demolition work as it continues to navigate the permitting process for full construction. It’s unclear how long it’ll take to get the project permitted, but the company said the full construction phase of the project will take about 30 months to complete once it starts.
UPDATE added that the vote of the investment committee was 3-0 and added comments from an R.I. Commerce Corp. representative.
Marc Larocque is a PBN staff writer. Contact him at Larocque@PBN.com. You may also follow him on Twitter @LaRockPBN.
