The New Markets Tax Credit (NMTC) Program permits taxpayers to receive a credit against federal income taxes for making Qualified Equity Investments (QEIs) in designated Community Development Entities (CDEs). Substantially all of the QEIs must in turn be used by the CDE to provide investments in Low-Income Communities (LICs).
The credit provided to the investor totals 39 percent of the cost of the investment and is claimed over a seven-year credit allowance period. Investors may not redeem their investments in CDEs prior to the conclusion of the seven-year period. The NMTC program provides financing availability for projects in underserved geographic areas and with extremely favorable terms for businesses and real estate developers or owners. The result of these investments fulfills financing gaps for projects to be completed, and it allows projects to be enhanced with community-oriented components, which generate measurable community impacts.
Project ONE is a complex urban, mixed-use development located in the heart of downtown Greenville. The project site was a Woolworth building that sat vacant for more than a decade before its demolition began in 2009. The location took its place in history with a racial protest sit-in at the old Woolworth lunch counter back in the 60’s. The counter was segregated and students from the all-black Sterling High School made their quiet stand for civil rights and against discrimination. After a few years, downtown businesses ended segregation peacefully. The Sterling High School students memorial statue will remain among the new buildings at its corner where Woolworth’s used to be.
Due to economic difficulties and property made up of various parcels with different owners, the city recognized the critical need for the redevelopment and took it upon itself to finalize acquisition of the various sites. The city contributed $4,000,000 for acquisition and site improvements and sourced a development team to redevelop the 179,000-square-foot nine-story mixed-use project into a dense program of ground-level retail and office space, university with green roof, corporate bank headquarters and training facility and a parking structure – all woven into an already spirited main street.
In addition to national retailer Anthropologie and a new headquarters for CertusBank, tenants at Project ONE include:
The project is striving for LEED Gold Certification from the US Green
Building Council.
“Without the new market tax credits provided by GNMO, the ONE project could not have happened. New market tax credits allowed us to afford a site that owners had been assembling for years — many of them the high-priced years. They also allowed us to partner with the city, requiring less city investment for a project intended to revitalize this entire end of town. Not only will there be new jobs, new retailers and new businesses on our site, there should be many more in the surrounding blocks.”
– Robert Hughes, President, Hughes Development Corporation
Since 2006 taxadvantagegroup has managed its affiliated $89 million Greenville New Markets Opportunity, LLC (GNMO) NMTC fund, which provides investment capital for real estate development projects in low-income areas throughout Greenville, South Carolina.
Tammy C. Propst | 864.271.2737 | tpropst@taxadvantagegroup.com