Interfaith Neighbors identified the NCAT replication model to meet the needs of the West Side community They also identified the lots in the corner of Springwood Avenue and Memorial Drive We were tasked to determine the feasibility of building an arts and technology center on these lots
Asbury Park has a rich history of music and in recent years has seen a revival of music and the arts The city has established it’s identity as a place of music and arts - regular concerts, plays, festivals and other public events are attended by residents and people from outside the city The waterfront redevelopment that began in 2006 with the acquisition of the waterfront by private developer Madison Marquette, spilled over into some parts of the downtown area along Cookman Avenue The city attracts people to their waterfront, then they seek out the restaurants, coffee shops and stores in the downtown area. People will travel from one part of the city to another looking for destination places
Interfaith has extensive experience and is efficient with it’s resources as a developer It’s affordable housing program has helped improve the constructed environment of the West Side with it’s homes It’s other programs are equally successful It’s rental assistance program has helped *blank* families in the past *blank* years It’s meals on wheels program has served *blank* people, delivering about *blank* meals a week The NJ Youth Corp was taken on by the organization after the state of New Jersey *blank blank* In addition to their commitment to the neighborhood’s revitalization led them to the Interfaith Neighbors West Side Asbury Park Neighborhood Plan, a plan approved and funded through Neighborhood Revitalization Tax Credits Even with their diverse programming, Interfaith has maintained good financial health along the years Because of this, Interfaith as an organization, financial health and experience in community development, make them the ideal entity to begin revitalization efforts along Springwood Avenue
Interfaith Neighbors has identified the importance of destination places and has chosen lots 1-6 of block 80 of the Gateway Zone as demarcated in the Amended Springwood Avenue Redevelopment Plan. It is important to note that the city has only secured rights to lots 2-5, which are the smaller lots. The Asbury Park Housing Authority owns the larger lots 1 & 6 An arts and technology center in this particular lot serves several objectives: It provides much needed services to the West Side community It incorporates the city’s current economic development strategy of music and arts into the programming* and it creates a destination area for people that use the amenities in the East Side It serves a catalyst for development along Springwood Avenue
The Gateway Zone has specific building designs and structure requirements to distinguish the area and let people coming in, they are entering a particular area Some important features to consider is that it must be a mixed use facility there is a maximum of 4 stories it must have a public space area
The physical revitalization of the West Side, can only be of any significance to its residents if it’s accompanied by much needed services Here you can see some social and economic indicators - Tracts 8072 and 8073 that correspond to the Westside As you know, there are huge economic, social and educational differences in the Westside when compared to the rest of the city, more so when compared to Monmouth County Perhaps starting with Educational discrepancies, the lack of a basic education degree sets a precedent for economic disadvantages for individuals. In the West side, high school and GED attainment are very low, so is the percentage of people with a higher education degree.
A lack of basic education sets up individuals for an economic disadvantage early on Here is a map from the American Community Survey where you can see in color graduation rates for Asbury Park when compared to the surrounding cities. In Asbury Park, 25% of people has not received a high school or GED certificate. Also, all the schools in the city, from elementary to high school, have not met the adequate yearly progress goals as defined by the No Child Left Behind Act of the US Department of Education in the past five years By this we know that residents of Asbury Park are at an educational disadvantage early in their lives, setting them up for greater challenges when entering the workforce. They are at a disadvantage because they receive a poor education but will have a greater disadvantage if they drop out. The the Asbury Park Learning Center, the Youth Corp. and the APHA CDC are some organizations that can help students obtain a GED yet these efforts don’t come without obstacles. Another obstacle that people have is that the closest GED Testing Center is in Longbranch.
The NCAT replication model that Interfaith has identified can address these educational needs in the West Side There are several elements of this model that fit Interfaith’s mission and technical needs To begin, their replication process will take them through some important steps, starting with feasibility like an affiliate organization evaluation to make sure that replication is with the right partnership and a neighborhood needs assessment to make sure that replication appropriate In the planning section, the affiliate organization will choose the right programs from the catalogue of technical vocational programs The replication process also helps the affiliate with implementation for the first three years
Here is a quick profile of other NCATs in the country. Their programming is designed to meet their specific population needs. To continue with the programming element of this replication model: Another important programming component of the NCAT model is the programming catalogue for youth arts programs. There include, fine arts, photography, ceramics and digital arts. There programs are important because they engage the youth in activities they like and allows for them to spend their time creating and being productive Another important component of the NCAT model is the academic support programming for K-12 students. This programming is meant to improve student academic outcomes in standardized tests The NCAT model will also help develop and establish a GED curriculum
Furthermore, the Manchester Bidwell takes careful consideration in their catalogue to make sure that their vocational and technical programs prepare their students with skills to compete in the workforce and earn living wages Here you can see that the two only work and professional earn living wages are in Art Design, Entertainment, Sports Media, and in Healthcare Support. The first four professions tend to require a higher educational degree. Since the Manchester Bidwell catalogue offers technical and vocational degrees, careers in the healthcare support field arethe only ones that that earn living wages
There is good news, it turns out some of the largest number of projected new jobs are in health services, health care and social assistance. These jobs which require some training or experience in the field can be targeted for students graduating from the Asbury Park center for arts and technology. Not only does the programming already exist, but graduates will earn living wages, which is important for a population that is looking to get out of poverty.
- Even though Interfaith Neighbors hoped to integrate music and the arts into the programming of the center, students trained in those fields will face some challenges when entering the workforce. Choosing programs that will place graduates in health ad medical services jobs in the better option Moving forward, we know that the programming will not require specific design elements such as industrial kitchens or recording studios that must be considered for the construction of the building
So now that we have looked at whether or not the NCAT model is a good fit for Asbury Park and what programs will most fit the needs of the community in the area, we turn to the operating budget for center. Important things to notice on the operating budget: A little under 1 million a year to operate and this based on a 33K SF space which is about 10K bigger than the other centers we looked at. we chose low cost programming You’ll notice 150 k fees per year for the MBC - we got the sense that this was for planning in addition to help with promoting and fundraising, but we thought it would be worthwhile to ask for a breakdown of this cost or communicate with other schools to see what one is receiving Since there is no fee charge for student (although we have been told that sometimes the school works with the center to funnel programs and/or aid to them since they have such a close relationship) there is a LOT of fundraising. Because we were unsure who would be taking on the management role of the APCAT we left these costs separate. If IN decides to take on – they should incorporate into their cash flow analysis
Why three models? Show a comparison between size and uses of spaces You’ll note that there is a four flour mode and two 3-floor models Each comes with specific number of parking based on total amount of square feet Show a comparison between NMTC and LIHTC Financing is a very essential component of determining if project is feasible although not the only way. There is also to the think about the effects of the financing because in this case the LIHTC bring with it residential as opposed to NMTC which does not We thought about how this might affect the area
With this in mind we constructed three models $190 per square fee for Residential $150 PSF Commercial 1.9 M per floor of Residential 2.5 M per floor of Commercial Total Development cost for 3 floor NMTC is $8.3 M Total Development Cost for LIHTC 3 is $8.9M Total Development Cost for LIHTC 4 is $12.5M
This shows the NMTC deal structure. On the right is the NRTC equity coming into the project – about 1 million This project has a total Qualified Equity Investment of …. The QEI Is the Amount of Money Invested by the investor into the CDE and is the basis for the amount of tax credits received by the investor 39% is applied over 7 years at 5 & 6 % The net equity coming into the project based on our QEI is …. OVERALL not much equity coming into project from NMTC and LARGE capital campaign Notes to self We set our price per credit at .75 Credits = $2.1 M
This is the FOUR floor LIHTC Deal Structure Credit allocation is based on Eligible Basis of $7.6 M We got a Basis boost and for being in a HUD qualified area We also got additional 25% for have a qualified Community space This gave us 952K of annual credits based on 9% LIHTC Note that 9% credits are really competitive – may need a consultant to help compete The total amount of equity from LIHTC is 7.9 M (799K a year) Note to self Credit priced at .84
LIHTC Model is the most financially feasible. Lowest Cap campaign Most equity generated by tax High NPV at potential selling point Because of the financial analysis above we chose the 4 floor LIHTC model, but there were other reasons for this choice….
We saw the residential component of the model as being able to provide a basis for a growing market on Springwood AVE Right now there is little on S Wood Ave to generate foot traffic and therefore sustain business The center and residential could provide a basis for later commercial investment It could also be sold in 15 year when it become eligible to be sold and converted into more commercial Finally we saw this as working well with the NCAT Model. It could be Artist lofts to compliment the art programming It could house students in general Because low-income housing and the NCAT service a similar population they would compliment each other Additionally the housing allows this population to remove themselves from potentially negative environment that is affecting their success With this in mind we recommend the 4 floor model and now turn to next steps to proceed with the planning
Since the lots identified in the Gateway Zone are not secured under one owner, a resolution to this matter should be sought. There is great risk in proceeding with the plans to build without title to the property. If lots 1-6 cannot be secured, Interfaith Neighbors should seek alternative lots or seek a rental space in the West Side. Proceed with NCAT consultancy – As previously stated, the NCAT replication model is a good option since the model is designed to provide technical expertise that the managing organization may not have. understanding the needs of the community and building allies will be critical objectives for the success of building an educational center focused on arts and technology. Further to this point, it would be especially effective if the leadership of the proposed center came from the West Side community. Additionally, Strategic alliances can also be found in the schools since they share the same goal of improving education in Asbury Park. Interfaith Neighbors can also begin to reach out to employers in the health and medical services field to learn about the technical and professional skills they seek when hiring new workers. Financing. First, Interfaith Neighbors will need to secure the maximum amount for financing under the NRTC program. Doing so reduces the amount to fundraise to support the entire debt of the project Second, Interfaith should also come up with a strategy to fundraise or seek private donations to close the financing gap. Hire LIHTC consultant to secure 9% credits . No doubt that along the way there will be challenges, but so long as Interfaith Neighbors keeps the interests of the West Side residents at that heart of the project challenges will work themselves out into valuable community successes. Proceeding with these steps ensures that Interfaith Neighbors is off on the right path Good. The text on the diagram is too small to read. Third, they may want to solicit an experienced LIHTC consultant who can help to obtain an allocation of 9% credits.
National Center for Arts and Technology Feasibility Analysis in Asbury Park, NJ A Project for Interfaith Neighbors
The Community Development Finance Lab Team Task: To determine the feasibility of building a National Center of Arts and Technology along a Springwood Avenue
Asbury Park is a Destination City With a Rich History of Music in the Jersey Shore
<ul><li>Rental Assistance </li></ul><ul><li>Meals on Wheels </li></ul><ul><li>Affordable Housing </li></ul><ul><li>NJ Youth Corp </li></ul><ul><li>Neighborhood Revitalization </li></ul>Interfaith Neighbors is a Versatile and Financially Stable Organization
The Gateway Zone in the The Springwood Avenue is the entryway to the West Side <ul><li>The Amended Springwood Redevelopment Plan calls for the creation of </li></ul><ul><li>Housing </li></ul><ul><li>Retail </li></ul><ul><li>A Park </li></ul><ul><li>Public Space </li></ul>
The Gateway Zone Has Specific Building Design Requirements
Residents in Asbury Park are at an Economic Disadvantage US Census – 2005 – 2009 American Community Census
Residents in Asbury Park are at an Educational Disadvantage 25% of people have not received a high school diploma or GED Schools have not met Adequate Yearly Progress (AYP) goals as defined by No Child Left Behind Act of the U.S. Department of Education US Census – 2005 – 2009 American Community Census 51-66.9% 66.9-77.0% 77.0-84.7% 84.7 – 90.7% 90.7-100.00% High School Graduation Rates
The NCAT Replication Process Helps Affiliates Design and Implement Programming
NCATs are Designed to Meet the Communities’ Educational and Vocational Needs to Enter the Workforce Manchester Bidwell
Careers in Healthcare Provide Living Wages Calculator by the Pennsylvania State University http://www.livingwage.geog.psu.edu/places/3402501960 Living Wages in Asbury Park One Adult One Adult, One Child Two Adults Two Adults, One Child Two Adults, Two Children Living Wage $11.87 $21.41 $17.02 $26.59 $33.75 Poverty Wage $5.04 $6.68 $6.49 $7.81 $9.83
NCAT Programming Aligns With Job Creation in Monmouth County Industries in Monmouth County with the Largest Number of Projected New Jobs for 2018 New Jersey Department of Labor
Local Economic Development Strategy and County-wide Job Opportunities Should Inform Programming Design Health & Medical Services Music, Entertainment & Recreation
APCAT Operating Budget Manchester Bidwell Youth Program Students / Year 60 Adult Program Students / Year 30
$2.1 NMTC Credits $985,000 NRTC Equity (after fees) $4.9 Capital Campaign CDE (QEI) Investors Bank NJ Department of Community Affairs Interfaith Neighbors Diagram 1: NMTC Schematic Asbury Park LLC (QLCIB)
Diagram 1: LIHTC Four Floor Schematic Limited Partnership $706,780 9% LIHTC Credits /year NJ Department of Community Affairs New Jersey Housing Finance Agency Investors Syndicate Equity Fund Asbury Park Community, LLC Bank Debt Interfaith Neighbors
Model 1-3 Financial Highlights <ul><ul><li>NMTC </li></ul></ul><ul><ul><li>LIHTC – 3 </li></ul></ul><ul><ul><li>LIHTC - 4 </li></ul></ul>Total Development Costs <ul><ul><li>$8.3 </li></ul></ul><ul><ul><li>$8.9 </li></ul></ul><ul><ul><li>$12.5 </li></ul></ul>Equity Generated by Tax Credit $1.6 $4.0 $8.0 Capital Campaign $5.0 $2.8 $1.3 NPV over 15 Years (LIHTC) and 7 Years (NMTC) $1.7 $2.0 $3.4 Annual Debt Payments $103,189 $105,768 $203,033
The Four Story Building With Two Stories of Low Income Housing is the Best Option