Innovative Finance
Innovative Finance for Nonprofit Capacity-Building
Praxia Partners’ Community Building Partners uses innovative finance to meet communities’ unique needs. Potter Davis was a historic building that had once been a local department store in downtown Cambridge, Ohio. Unfortunately, the building lay mostly or entirely vacant for decades. Meanwhile, the local Area Agency on Aging, Region 9 (AAA9) was outgrowing its offices, which were scattered over three buildings, as the senior population in its nine-county service area grew. It sought to consolidate its offices in a central location.
Community Building Partners proposed a plan whereby the local port authority would buy Potter Davis, renovate it, and lease it back to AAA9. This meant more office space in a better location for less than AAA9 was paying for their existing offices. To make this affordable, Community Building Partners put together financing from a number of disparate sources, including:
- Ohio Historic Preservation Tax Credit. As a historic building, we prepared an application for the state’s competitive tax credit program. The project won state tax credits equal to 20% of the project’s expenses.
- Federal Historic Preservation Tax Credit. We arranged for this non-competitive tax credit equal to 10% of the renovation expenses.
- JobsOhio grant. Because the new building would give AAA9 space to hire more employees, JobsOhio gave a grant of $150,000 to support the project.
The construction loan, permanent mortgage, and tax credit investment were all provided by Wesbanco. Having one financial institution handle all aspects of the deal simplified the financing. With completion expected in late 2019, the renovated Potter Davis Building has brought investment to Cambridge, provided much needed space for a vital social service agency, and put a historic building back into service for its community.
