Downtown projects hit foundation's loan limit

Foundation cap hit, bringing call for repayments
A project to turn the former Vine Inn in Olde Town into studio apartments received funding approval from a foundation, but it took the city to its borrowing limit.

 

Any future projects in downtown Augusta that receive funding through the Geor­gia Cities Foundation will likely be on hold until September.

Low-interest loans issued through the foundation will be stalled until money from outstanding loans is repaid and cycled back into the program. The city hit its cap in June after an application was approved to convert a former bed-and-breakfast at 334 Greene St. into 10 studio apartments, said Mar­garet Woodard, the executive director of the Downtown Develop­­ment Authority.

As of May 31, nearly $945,000 loaned for seven renovation projects downtown was owed back to the foundation, said Alan Dicker­son, the community development manager for the foundation.

“A lot of loans have been approved, but they haven’t started paying them back yet because you get the money when the work is completed,” Woodard said. “That is the challenge right now, but we should be in good shape in the fall.”

The authority acts as a liaison for developers wishing to use a $250,000 loan by recommending the project to the foundation, which then awards funds. Approved projects should spur further development, add jobs, promote downtown housing or enhance the cultural
enrichment of the community, according to the foundation.

Three renovation projects in Augusta are pending until more funds are available, Dickerson said.

Rome, with 13 renovation projects funded by the foundation, was the only Georgia city with more activity than Augusta. Thomasville and Macon had figures similar to Augusta’s, according to Dickerson.

Loans must be fully repaid in 10 to 15 years and are typically done in monthly payments, he said.

More than $15 million has been loaned by the foundation for 90 projects in 47 cities. The loans can be used for buying property, rehabilitating buildings, new construction, and providing green space and parks.

Woodard said it’s a good incentive for more mixed-use developments to come downtown.

Projects approved locally include live-retail space at the Johnson Building at 758 Broad St. and a mixed-use facility with a restaurant and small rental storage units at 566 Broad St.

“It’s great because in today’s world of financing, it’s the gap that we need in order to get projects completed,” Woodard said. “We’re
seeing a tremendous amount of activity going on right now.”

Another funding tool, a federal loan, is available to developers through the foundation if the project is 51 percent owner-occupied, Woodard added.

More local companies are taking advantage of state and federal tax credits accessible for rehab projects in historic districts. Historic Augusta reports about 25 applications underway for historic tax credits in Augusta – the most since the organization was founded in 1965, said Tennent Houston, the chairman of the group’s preservation committee.

“The economics in the last few years have become to be very favorable for investing in older properties,” he said.

Former Olde Town inn to become apartments

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