The agreement will also require approval of the full Downtown Investment Authority board and City Council.
A Downtown Investment Authority committee approved a development loan to Jacksonville-based Vestcor Inc. for its proposed Lofts at Cathedral project.
The DIA Strategic Implementation Committee voted 5-0 on Aug. 17 to approve a $625,000 loan for the multifamily housing project at 325 and 327 E. Duval St.
The full DIA board will consider the loan at a future meeting. If approved, it will then go to City Council.
The project is expected to cost $28.8 million.
Vestcor plans to construct 90 units and redevelop the Community Connections building to add 30 units. Vestcor purchased the Community Connections building and 1.25-acre adjacent property in September 2019 and February 2020 for a total of $1.4 million.
The development will have a mix of income requirements. Eighteen units are reserved for tenants at 30% of the area’s median income, 39 units at 60% of the median income and 27 units at 80% of the median income. There will also be 36 market-rate units.
Vestcor requested the loan so the project would be eligible for the Florida Housing Finance Corp.’s Low Income Housing Tax Credit program, the DIA term sheet states.
The 20-year, 1% interest loan will be drawn from the DIA Northbank CRA Loan Program.
“It’s going to be great for that particular area,” said DIA Strategic Implementation Committee Chair Ron Moody. “Vestcor has been a marvelous partner with us, helping us develop Downtown. So in my mind, it’s a go.”
The Community Connections building was constructed in 1949. It was part of the Florence Davis YWCA and was awarded local landmark status in June 2017, according to the DIA.
Vestcor told city officials it plans to apply for a $400,000 grant from the city Historic Preservation Trust Fund.
The development agreement between Vestcor and the city caps local taxpayer-backed incentives at $1.025 million.
Vestcor will contribute $9.25 million in debt financing for the development. It will defer its $766,032 developer fee.
DIA awarded development rights to the Community Connections building to Vestcor in August 2019.