(BLOOMINGTON) – Boston-based Local Enterprise Assistance Fund (LEAF) will invest $425,000 to help Bloomington Cooperative Living (BCL) construct 18 new affordable housing units at 921 West 9th Street.
In addition, CDFI Friendly Bloomington (CFB) will invest $408,000 and the City of Bloomington’s Housing Development Fund (HDF) will invest $120,000 to support BCL’s renovation of the long-vacant single-family home into a housing cooperative.
To finance this project, CFB engaged LEAF, a nonprofit Massachusetts CDFI specializing in cooperative organizations, to be the majority co-lender and provide expertise in funding housing cooperative development projects. LEAF and CFB will provide construction and permanent financing, including the first-ever loan from CFB’s capital enhancement fund, to ensure affordability for BCL. The City’s HDF also provided a critical deferred loan, which will serve as equity as long as the property remains affordable housing.
Created to bring new, flexible capital to the community, CFB will invest its $408,000 in the project at a below-market interest rate. CFB’s loan is essential to attract LEAF to the project and guarantee affordability for BCL. This project marks CFB’s first deployment of loan capital from its “enhancement fund,” a revolving loan pool originally capitalized by the Bloomington Urban Enterprise Association, Bloomington Redevelopment Commission, and low-interest debt from German-American Bank, First Financial Bank, and Old National Bank. The enhancement fund improves loan terms for local borrowers and facilitates investments from CDFIs from other places to finance vital developments in Bloomington.
The 921 Project involves a full interior renovation and expansion of 921 W. 9th St., which sits in the Near West Side neighborhood in downtown Bloomington. Planned for a 7,500 ft² footprint, the property overlooks Reverend Butler Park and Community Gardens. Prior to BCL’s acquisition, the structure had been unoccupied for at least five years, largely due to the significant repairs required. This initiative will create 18 newly renovated bedrooms, with eight of them in two-bedroom suite formats, two shared kitchens, and a host of new amenities. The units will be affordable to individuals and families earning under 50% of area median income, which is exceptionally rare for properties that are not part of the federal voucher system. BCL intends for the suites and location to appeal to young families, continuing its efforts to meet Bloomington’s diverse housing needs. Rents are projected to be highly affordable, at $400/month for a single room and $520/month for a two-bedroom suite.
Notably, the Inter-Cooperative Council at Ann Arbor (ICC), a Michigan cooperative housing nonprofit, generously pledged one of its properties as collateral for the project. Said ICC President Julian Tabron, “ICC believes in BCL’s potential to create a positive impact in their local community, and we see this partnership as an opportunity to start a regional connection among housing co-ops in the midwest.”
“BCL is tremendously pleased with the cooperative spirit that has driven the project, from financing to community and municipal engagement,” BCL President Zackary Dunivin said. “The 921 house is a leap forward for our organization and the continued expansion of affordable, community-oriented housing in Bloomington.” BCL Treasurer Evelyn Smith added: “The work that so many folks have put into making this a reality is probably the best example I can imagine for the co-op ethos: together we can build incredible things.”
“The Local Enterprise Assistance Fund is pleased to support the redevelopment of 921 W. 9th St. in Bloomington,” said LEAF’s Director of Lending Josh Glickenhaus. “This project will create much-needed affordable housing, and uphold BCL’s commitment to the principles of cooperation and democratic self-governance. LEAF appreciates the vision and hard work that BCL has put into this project, and the support of the many partners who have helped make it a reality.”
“This is a great addition to affordable housing close to downtown. And I’m very pleased to see how CDFI Friendly Bloomington is hitting its stride and helping bring partners from across the country together to make good things happen here at home,” said Bloomington Mayor John Hamilton. “None of this happens without strong and innovative local partners, including BCL, who can overcome challenges to make lives better for more of our residents. Thanks as well go to the City’s Housing Development Fund which provided a critical piece to bring it all together.”
“CFB is proving that the CDFI Friendly approach works,” according to Mark Pinsky, founder of CDFI Friendly America and leading industry expert. “A Boston-based CDFI is able to lend in Bloomington for an important community project because CFB is involved as a technical advisor and has a financial stake in the project.”
“This unique collaboration enables a small nonprofit to undertake an unprecedented mission-based project without jeopardizing their financial solvency,” said Brian Payne, executive director of CDFI Friendly Bloomington. “This is a tremendous achievement for BCL, and a genuine proof of concept for CDFI Friendly Bloomington.”
Bloomington Cooperative Living was founded in 2007 to foster vibrant, affordable housing opportunities in Bloomington that contribute to the establishment of local neighborhoods with a strengthened sense of community. Despite the undeniably transitory nature of rental housing, BCL endeavors to establish a sense of permanent identity and community that persists through the turnover of renter populations. Since its founding, BCL has grown to operate three properties with 48 total bedrooms in single room occupancy format, with each property maintaining the level of accessibility and affordability promised in the organization’s mission. The 921 Project is the first major construction project for BCL, expanding their impact and providing more permanent affordability.
About CDFI Friendly Bloomington
CDFI Friendly Bloomington is an innovative new organization working to increase access to flexible, affordable financing for community development. Formed in 2018, CDFI Friendly Bloomington is a nonprofit focused on connecting local investment opportunities with regional and national community development financial institutions (CDFIs). CDFIs are private financing entities that specialize in markets and populations that often cannot qualify for traditional financing. CDFI Friendly Bloomington promotes local projects, facilitates deals, and offers financing alongside CDFIs to incent their participation or bridge an asset gap in the project. More information can be found at https://www.cdfifriendlybtown.org.
Based in Boston, MA, Local Enterprise Assistance Fund (LEAF) has operated since 1982 with the continued goal of promoting human and economic development by providing financing and development assistance to cooperatives and social purpose ventures. LEAF lends nationally with a focus on worker-owned firms, community-owned food cooperatives, and housing cooperatives and land trusts that provide affordable housing options for low-income families and individuals. Since its founding, LEAF has invested and leveraged over $122 million in community-owned cooperatives.
About the HDF
The City of Bloomington’s Housing Development Fund was established by City ordinance in 2016 to provide funding to developers to increase the amount of affordable housing available within the Bloomington community. Since its inception, the fund has invested $1,035,421 in the development of 262 affordable housing units for low/moderate income families.