Louisville Downtown Development Corporation (LDDC) is in the process of starting a new commercial loan fund for real estate developers in downtown. The new Loan Fund is patterned after the Downtown Housing Assistance Fund (DHA) which was started in 2003. The DHA Fund was started to help housing developers in downtown finance new condominiums and apartments.
It was determined that additional housing units in downtown would be unlikely unless a special Loan Fund was available to provide a supplement to traditional bank financing. The Loan Fund has worked well. About $7 million in loans has leveraged about $170 million in housing investments in downtown, resulting in over 400 new units.
LDDC is now taking the lead on another similar venture to help downtown Louisville to keep growing producing new investments and new jobs for the community. The new Commercial Loan Fund will assist non-housing projects-office and retail-with the same concept. With traditional financing very challenging at this time, real estate developers need financing help so that they can move projects forward. It is expected that the new Commercial Loan Fund will be capitalized by LDDC and several other private sector investors.
The goal is to grow the fund over time to the same level of investment that DHA has experienced for housing. The Loan Fund will only be used in conjunction with a primary lender to minimize risk. For mixed use projects, it will be possible for a developer to explore using both Funds.
Taking your entrepreneurial spirit and opening a business downtown should be as smooth a process as possible. Many resources are available online to get anyone started at the business section of the Louisville Metro’s website.