HUD SECRETARY APPROVES $20 MILLION LOAN GUARANTEE TO PHILADELPHIA

PHILADELPHIA - U.S. Department of Housing and Urban Development Secretary Shaun Donovan today announced that he is approving a $20 million loan guarantee to the City of Philadelphia to fund economic development activities including a 219,000 square foot shopping center in the City's northern neighborhood center of Allegheny West, and a community retail shopping center on the site of the former Edison High School.

HUD's loan guarantee will leverage $15 million in other public funding with $3,000,000 of going to the Baker's Center proposed project anchored by a supermarket in Allegheny West and $1,750,000 for the proposed 36,188 square foot community retail shopping center named Edison Square at the site of the former Edison High School which is now planned for demolition.

"Today, we take another step forward in a new vision for these neighborhoods," said Donovan. "The City of Philadelphia will not only cultivate a community of new homes, retail and green spaces for its citizens but will generate hundreds of news jobs in the process."

HUD's Section 108 Loan Guarantee Assistance Program enables local governments to borrow money from private investors at reduced interest rates to promote economic development, stimulate job growth and improve public facilities. Such public investment is often needed to inspire private contributions, to provide seed money, or to simply boost confidence that many private firms and individuals need to invest in distressed areas.

"This is a win win for the City and all those involved," said HUD Regional Administrator Jane C.W. Vincent. "These projects will create jobs for Philadelphia residents, leverage private investment, expand retail goods and services in the designated neighborhoods, eliminate blight and increase revenue."

According to the City's plans, the retail development is expected to generate 858 new jobs, more than half of which will be made available to low- and moderate-income persons. Section 108 loans are not risk-free, however; local governments borrowing funds secured by this loan guarantee program must pledge their current and future Community Development Block Grant (CDBG) allocations to cover the loan amount as security for the loan.

###

HUD's mission is to create strong, sustainable, inclusive communities and quality affordable homes for all. HUD is working to strengthen the housing market to bolster the economy and protect consumers; meet the need for quality affordable rental homes: utilize housing as a platform for improving quality of life; build inclusive and sustainable communities free from discrimination; and transform the way HUD does business. More information about HUD and its programs is available on the Internet at www.hud.gov and espanol.hud.gov. You can also follow HUD on twitter @HUDnews, on facebook at www.facebook.com/HUD, or sign up for news alerts on HUD's News Listserv.