TAG By Cherry Bekaert Assists in New Markets Tax Credit (NMTC) Financing for the Revitalization of the Historic Snuff District
Tax Advantage Group (“TAG”) by Cherry Bekaert, a practice specializing in New Markets Tax Credit (“NMTC”), and other tax-based capital financing, assisted Conwood I, LLC in structuring the tax credit financing for their mixed-use project located in the historic Snuff District in uptown Memphis, Tennessee. With a complex financing structure, the project utilized $12.5 million of NMTC Allocation from a financing team including: National Trust Community Investment Corporation, a national Community Development Entity; NMTC investment from East West Bank, Federal historic tax credit equity from NTCIC Climate Impact & Revitalization Fund I, LLC, Opportunity Zone equity and other equity from the project sponsors. The project secured permanent debt from FirstBank.
As local Memphians, the sponsor team has taken a strong interest in revitalizing the historic Snuff District. With a $200+ million total development package, the sponsor team propose to transform the Uptown neighborhood into a thriving, mixed-income community where residents can live and work while enjoying all that Memphis has to offer. With a vision for affordability at all levels, providing jobs from entry level to administrative, the sponsors have begun this transformation in the Conwood I project.
The project is one of the initial projects to move forward in the historic Snuff District and is catalyzing over $140 million in additional investment in the area. “We are excited to be a part of this first-in project which will bring much needed housing and employment to an area of Memphis struggling with unemployment at three times the national average and median family income at 34 percent of the greater Memphis area,” said Pete Byford, Senior Manager of TAG by Cherry Bekaert.
With the $59 million financing complete, Conwood I will redevelop the abandoned American Snuff Company facilities to include 137 residential units, including 30 that will be affordable at only 80 percent of Area Median Income. The project also includes limited street level restaurant space and the headquarters and administrative offices for Varsity Spirit, providing 238 full-time jobs. The company has a specific focus on development from within, as demonstrated by their President who began with the company as an entry level employee, and by their internship program with the local school system. They also display a push for inclusion through their creation of an entire category of cheer for those with special talents in the CheerABILITIES and DanceABILITIES divisions.
This project marks a continuation of TAG by Cherry Bekaert’s expertise in all aspects of tax credit financing, including transferrable state and federal tax credits in addition to New Markets Tax Credits. TAG has assisted projects in utilizing multiple incentive-based capital products with examples including Plush Mill Revitalization in Greenville, SC and the Fairfield County Government Complex in Winnsboro, SC.
About Tax Advantage Group by Cherry Bekaert
Tax Advantage Group by Cherry Bekaert specializes in New Markets Tax Credits, and other capital sources, helping non-profit and for-profit organizations access capital and transform communities. In addition to managing $545 million of NMTC assets, since 2004 TAG has played an instrumental role in securing funding for over $1.5 billion for community and economic development projects across the United States.