|Region VI: 15-47
June 10, 2015
OKLAHOMA CITY RECEIVES $6.9 MILLION HUD LOAN GUARANTEE FOR REDEVELOPMENT OF HISTORIC SITE
Funds Will Create 138 New Jobs and Support Growth
OKLAHOMA CITY - The U.S. Department of Housing and Urban Development today announced the approval of a $6.9 million loan guarantee to Oklahoma City, which will help provide needed jobs and economic development in the central business district. The city will re-lend its guaranteed loan proceeds for the redevelopment costs of the historic, former Fred Jones Manufacturing Plant Building. Built in 1916, the facility was originally used as a Ford Model T assembly plant.
HUD is providing the loan guarantee assistance under its Section 108 Loan Guarantee Assistance Program which enables local governments to borrow money from private investors at reduced interest rates. State and local governments use this financing to assist with a variety of community and economic development projects, including those projects that create employment opportunities. Over the years, Section 108 guarantees generally have generated $4 of private investment for every $1 in Section 108 guarantee.
Oklahoma City will use the funding to assist a private developing entity redevelop the site as a 135 room hotel. The hotel will include a contemporary art museum of 13,000 square feet open to the public, 5,100 square feet of meeting and event space, and a restaurant featuring locally grown food products. The CDBG national objective met by this historic renovation is primarily to benefit low and moderate income persons through the creation of jobs. At least 51% of the jobs will be held by or made available to low and moderate income persons. The city estimates that the project will lead to the creation of 138 new jobs for the area.
"HUD's Loan Guarantee Program can be a powerful public investment tool that provides for economic development in underserved areas," said Regional Administrator Tammye H. Treviño. "The program is specifically designed to help cities find solutions for their particular needs. Funds for the historic Fred Jones Building will help Oklahoma City maintain revitalization efforts and provide jobs for residents who need them most."
Section 108 loans are not risk-free, however; local governments borrowing funds secured by this loan guarantee program must pledge a portion their current and future Community Development Block Grant (CDBG) allocations, as well as additional project assets to cover the loan amount as security for the repayment of loan. The length of time for repaying these loans can be up to 20 years.
HUD's mission is to create strong, sustainable, inclusive communities and quality affordable homes for all. More information about HUD and its programs is available on the Internet
at www.hud.gov and http://espanol.hud.gov.
You can also connect with HUD on social media and follow Secretary Castro on Twitter and Facebook or sign up for news alerts on HUD's Email List.