In Richmond, Virginia, an old American Tobacco Co. campus is being transformed into upscale apartments with $34 million in tax credits and $26 million in tax-exempt debt.
Indianapolis is also looking to its manufacturing past, with Wisconsin-based Hendricks Commercial Properties redeveloping an old Coca-Cola bottling plant into a $300 million mixed-use project that will include a boutique hotel, office spaces and a food hall.
Historic Roots
“There’s a pattern and a really wonderful fabric of repurposing these type of facilities as the houses of revitalization,” said John Austin, director of the Michigan Economic Center and economic lecturer at the University of Michigan.
Fort Wayne and local governments will supply $65 million in public money for the project, including $45 million in tax-exempt bonds backed the county’s 1 percent food and beverage tax. Federal, state and private funding make up the remainder. The bonds could be sold in third quarter of the year.
So far, more than a dozen tenants have announced that they intend to lease space at Electric Works, including Parkview Health, Fort Wayne Metals, Medical Informatics Engineering Inc. and Indiana University. Construction is scheduled to begin this fall and be completed in late 2021.
Such projects are not without peril, said Stephen Eide, a senior fellow at the Manhattan Institute who specializes in state and local finance.
“Bonds can have a very long horizon, and we don’t know where these cities will be in 10 years, much less 20 or 30 years,” he said.
This article was provided by Bloomberg News.