$10.5 Million Redevelopment Project to Provide Jobs, Healthy Food Access and Community Impact
Denver, CO, December, 29, 2017 – Colorado Enterprise Fund (CEF) is proud to announce its largest economic development and commercial real estate investment, the Chambers Place Redevelopment Project, which will be instrumental in helping reinvigorate the Northeast Denver neighborhood of Montbello.
CEF has worked as the lead lender for the secondary financing of the $10.5 million commercial real estate project, convening two other non-profit funders and working with a bank lender to provide the funds necessary to make the redevelopment possible. The property is a shopping center that was originally anchored by a Safeway store which abandoned the property over 4 years ago with other tenants departing soon thereafter.
The project principals are brothers Chris and John Leevers, who are owners of the Chambers Place property and members of a four-generation grocery family. Their company, Leevers Supermarkets, Inc. (LSI) is now 100% employee-owned by an ESOP with nearly 200 members and roughly 65% minority ownership. LSI generally operates under the name of Save-A-Lot, which is the anchor tenant in the redevelopment. Save-A-Lot is a limited-assortment, value-oriented grocery store that provides a wide variety of fresh and healthy foods in some of Denver’s largest USDA-certified food deserts. It will increase food access in Montbello and help preserve cultural diversity in a rapidly changing neighborhood.
The total project cost of $10.5 million funds the acquisition, renovation and development of approximately 80,000 square feet of commercial real estate leased to grocery, health and other family-oriented businesses appropriate for the Montbello neighborhood. The Leevers obtained a $4.9 million bank loan commitment from Wells Fargo for a senior loan that covered about half of the project total project cost. They looked for more than two years for the additional permanent financing for the redevelopment of the property. CEF was instrumental in filling the funding gap by assembling and coordinating the three nonprofit investors that provided $3.5 million in a shared second mortgage as follows: Colorado Enterprise Fund $1.0 million, Colorado Housing and Finance Authority $1.5 million, and The Colorado Trust $1 million.
In other states, similar projects with such high impact in distressed areas like Montbello have been funded by bank investors using New Markets Tax Credits (NMTCs) from a program of the U.S. Department of Treasury’s Community Development Financial Institutions (CDFI) Fund. “NMTCs are designed to stimulate economic growth and bring capital investments to economically distressed communities. When that option failed to materialize for this project, the Leevers came to us to seeking a flexible alternative solution to fill their financing gap. That’s when we got creative and sought out our other partners,” says Ceyl Prinster, President and CEO of CEF.
Chambers Place Project Economic and Community Impact
The project will improve retail access to fresh and healthy foods, increase healthy eating and active living, and encourage economic development in a formerly vacated retail center located in a lower-income neighborhood. “The community really needed this project to once again have access to healthy food. When grocery stores return to a neighborhood, they support the communities and are a key anchor to spur other economic development opportunities,” says Prinster. “Chambers Place is an exciting model of mission-driven lenders collaborating on an impact investment resulting in improved health and economic vitality to an under-resourced community. The project model of a grocery store that creates quality jobs and has a wide variety of fresh food options at affordable prices combined with the overall health, fitness and family orientation of the tenant mix is the gold-standard of impact we want to see in a project like this.”
The Save-A-Lot will provide robust fresh and healthy food at affordable prices, sometimes as much as 40% lower than mainline stores. It will offer more than 150 types of fruits and vegetables, 3,000+ boxed and canned items, an in-house scratch bakery as well as an on-site butcher in its fresh meat and seafood department. The store includes a Community Room with a kitchen that will be used for cooking and nutrition classes, community meetings and health screenings. The store has also engaged other community groups in a Save-A-Lot Advisory Council, and LSI is partnering with the nonprofit Cooking Matters to produce videos on affordable healthy recipes and nutrition. “We try to go one step further by working with customers to build healthier families and communities,” says John Leevers, President of LSI. “The hope is that our large assortment of produce, cooking and nutrition classes, and having tenants that promote active and healthy living will achieve that.”
The entire Project is expected to create more than 80 jobs. In addition to anchoring Chambers Place with a Save-A-Lot, the shopping center will be revitalized with other new tenants including a Planet Fitness and DaVita clinic. The center also offers a well-established high-quality child care center, Early Success Academy, which is owned by long-time CEF customer, Diana Gaddison and serves many families in the area. With this project, Chambers Place is addressing many of the social needs in a community that experiences significant health disparities and high poverty levels.
Healthy Food Financing at CEF
CEF is providing financing for this project through its Healthy Foods Fund. More than 29 million Americans live in urban neighborhoods or rural towns where healthy food is inaccessible, according to the USDA's Economic Research Service. These same areas struggle with high unemployment rates and economic stagnation. To address these issues, the CDFI Fund created the Healthy Food Financing Initiative (HFFI), which includes grants and loans to organizations like CEF. Since 2012, CEF has received three rounds of funding from the HFFI program totaling $2.2 million. CEF leveraged these funds with an additional $1.25 million in grants from the Colorado Fresh Food Financing Fund (C04F) and the national ReFresh partnership (part of the JP Morgan Chase PRO Neighborhoods initiative) to create a dedicated CEF Healthy Foods Fund Loan Program. These funds finance food production, grocery retail, local food distribution, and innovative healthy food businesses throughout urban and rural areas of Colorado. CEF lends to all segments of the food system to improve access to fresh, healthy food for Colorado’s residents and to promote economic and health benefits for communities that are USDA-designated “food deserts.” (Click here for a map of areas lacking access to healthy food outlets.) Including this latest loan, CEF has provided $3.65 million in funding to 45 small businesses from its Healthy Foods Fund. Because of this funding, more than 215 jobs have been either created or retained in Colorado.
About Colorado Enterprise Fund
Founded in 1976, CEF generally provides loans up to $500,000 to finance small businesses and startups unable to obtain funding through traditional banks. With a mission to accelerate community prosperity by financing and supporting entrepreneurs and small businesses, CEF has provided over $65 million in loans to more than 2,100 businesses to help create or retain over 18,000 jobs in the state. A nonprofit Community Development Financial Institution (CDFI), CEF is based in Denver with a satellite office in Fort Collins. CEF’s lending and consulting services are available statewide. For more information, visit: www.coloradoenterprisefund.org
About Colorado Housing and Finance Authority
The Colorado Housing and Finance Authority (CHFA) is a quasi-governmental agency that strengthens Colorado by investing in affordable housing and community development, offering financial resources to support homeownership, affordable rental housing, and businesses. CHFA serves as the fund administrator for the Colorado Fresh Food Financing Fund (CO4F), the goal of which is to improve access to healthy food in underserved Colorado communities by financing grocery stores and other forms of healthy food retail, and to encourage economic development in low- to moderate-income neighborhoods. The seed funding for CO4F comes from The Colorado Health Foundation, which developed this initiative based on research studies of food-access barriers in Colorado and national Fresh Food Financing best practices. CO4F partners with CEF? to finance small and innovative fresh food concepts. www.chfainfo.com/CO4F/
About The Colorado Trust
The Colorado Trust (The Trust) is a health-equity foundation whose mission is to advance the health and well-being of the people of Colorado, enabling them to have fair and equal opportunities to lead healthy, productive lives regardless of race, ethnicity, income or where they live within the state. The Trust works to mitigate the social determinants of health that cause health inequities arising because of the circumstances in which people grow, live, work and age, and the systems in place to deal with illness. The conditions in which people live are shaped by political, social and economic forces. The Trust uses a variety of grant-making strategies and approaches in its work to advance health equity for all Coloradans, including community partnerships throughout the state.
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