Nov 5th , 2024 Presidential General Election.
Developer Charles Dickerson celebrates completion of “The Beauton,” a new $7.3M mixed-use affordable housing project in Detroit’s North End Neighborhood
- Detroit developer Charles Dickerson III cuts the ribbon on a new affordable housing project creating 29 brand new apartments that will be guaranteed at affordable rates for the next 12 years.
- More than half of new apartments at or below 80% AMI (Area Median Income)
- Project is the latest to take advantage of the Detroit Housing for the Future Fund (DHFF)
Detroit Deputy Mayor Melia Howard, members of Detroit City Council and Detroit developer Charles Dickerson III cut the ribbon today on a new multi-family affordable housing development in Detroit’s North End. “The Beauton,” a $7.3 million mixed use building will bring another 29 units of brand-new affordable housing to Detroit.
The Beauton provides 29 new affordable apartments: 10 micro-studio units, 15 studio units, 2 one-bedroom units, and 2 two-bedroom units. Many of the units are well below market rate to make them affordable to more Detroiters living in the area. Units will have rents based on 50-120% of area median income (AMI), with over half of the units at or below 80%. Rents for the micro units will be as low as $700 per month. Under the agreement, affordability of the apartments is guaranteed for the next 12 years.
“North End has seen a lot of new investment that can bring rent pressures for existing residents,” said Mayor Duggan. “The Beauton will bring 29 more units of much-needed affordable housing to North End to help make sure residents of all income levels can live in a growing and thriving neighborhood.”
Council President Mary Sheffield is delighted to see the expansion of housing availability and affordability and what it will mean for the storied North End and those who want to live, work and play there. “The Beauton Development not only creates new affordable housing units for residents and families, but it also showcases what is possible when developers of color are engaged and given an opportunity to participate in the revitalization of our neighborhoods,” she said. “With the completion of the project, I look forward to the residual positive impact on the North End community that is sure to follow."
Funding from DHFF, Capital Impact Partners, Ebiara Fund, and MEDC
The $7.3 million ground-up project was made possible by funding from several sources, including a $1.55M loan from the Detroit Housing for the Future Fund (DHFF). The development also received $550K in preferred equity, and $100K developer of color pre-development matching grant from DHFF. Capital Impact Partners provided a construction loan of $2.45M, a bridge loan of $1.35M, and a grant of $93K. Additional support includes a $1.497M grant from Michigan Economic Development Corporation and a $500K loan from Ebiara to CADS III Management to support the project and the firm’s overall growth strategy. The Detroit Economic Growth Corporation awarded a $743K tax abatement for the project spread out over the next 15 years.
“I am truly grateful for the support that was made available by all of our partners on this project” said Charles Dickerson, whose company CADS III Management is developing the Beauton. “Making sure these apartments were affordable is important to us. Making sure the Beauton is attainable for all Detroiters is a critical part of the mission for this project.”
"The Beauton has transformed three parcels that were once vacant, blighted and aging into a beautiful building featuring a combination of affordable housing and market-rate units," said Damon Hodge, Senior Loan Officer for Capital Impact Partners, which is part of the Momentus Capital branded family of organizations. "We are proud to provide Charles Dickerson with financial support to help stabilize and revitalize the resurgent North End neighborhood. Charles graduated from our Equitable Development Initiative in 2020 and has expanded on his work serving Detroit, while also mentoring emerging local developers so that they too can do even more to help our communities."
In cooperation with LISC and the city of Detroit, the project qualified for a DHFF Developers of Color Matching Grant, an investment designed to grow the pipeline of minority-led affordable housing and preservation projects in Detroit. It offers up to $100,000 in matching funds to cover a portion of a project’s predevelopment expenses and soft costs. The grants are made possible through a partnership with JPMorgan Chase.
“DHFF and LISC Detroit are excited to join Charles in cutting the ribbon on another housing option for Detroiters,” said Rob Lockett, Executive Director of LISC Detroit. “We’re pleased to have provided a Developer of Color Grant to his firm, thanks to our amazing partners. DHFF is designed to encourage funding support of new and mixed-income units within the financial means of city residents. Affordability is the key to continuing to leverage additional developments throughout communities in the city.”
DHFF, a private investment fund aimed at directing capital to creating new and preserving existing affordable housing in Detroit, is anchored by a $15 million commitment from JPMorgan Chase of the fund’s total $58 million raise and a $10 million guarantee from The Kresge Foundation. DHFF is managed by LISC Fund Management, LLC, a subsidiary of Local Initiatives Support Corporation. LISC Detroit sources and originates loans for DHFF. DHFF is a part of the larger Affordable Housing Leverage Fund, which is an initiative with the City of Detroit’s Housing & Revitalization Department and the Michigan State Housing Development Authority (MSHDA). Including the Beauton, the DHFF has now funded 13 projects totaling 435 new or preserved affordable units in the city.
"Projects like The Beauton exemplify the power of partnership and the impact of the Detroit Housing for the Future Fund in creating affordable housing solutions that meet the needs of our residents,” said Julie Schneider, Director of the City's Housing and Revitalization Department.
The project also benefitted from a loan from the Ebiara Fund, which is designed specifically to ensure that developers of color not only participate in Detroit’s rebuilding but grow and scale emerging development firms that play a leadership role in that effort going forward. The Beauton is the first “from the ground up” project for Charles Dickerson and CADS III Management” said Rod Hardamon, Managing Director of Ebiara. “Our goal at Ebiara is to make sure that historically underrepresented development firms, like CADS III Management have a significant role in shaping Detroit long into the future.”
About LISC Detroit
LISC Detroit is a local organization founded in 1990, within the Local Initiatives Support Corporation network that includes 38 offices in urban areas across the country as well as a rural office that serves more than 44 states. National LISC, founded in 1979, is the largest national community development financial intermediary, combining corporate, government, and philanthropic resources to help community-based organizations revitalize their neighborhoods.
LISC’s mission is that every low-income community has the chance to thrive. LISC equips struggling communities with the capital, strategy, and know-how to become places where people can thrive. Working with local leaders we invest in housing, health, education, public safety, and employment — all basic needs that must be tackled at once so that progress in one is not undermined by neglect in another. Sharing our expertise of 41 years, we bring together key local players to take on pressing challenges and incubate new solutions. With them, we help develop smarter public policy. Our toolkit is extensive. It includes loans, grants, equity investments, and on-the-ground experience in some of America’s neediest neighborhoods.
About the Detroit Housing for the Future Fund
Detroit Housing for the Future Fund (DHFF) is a mission-driven private investment fund with the primary goal of addressing the severe shortage of affordable housing in Detroit. DHFF is managed by LISC Fund Management, LLC, a subsidiary of Local Initiatives Support Corporation. LISC Detroit sources and originates loans for DHFF. DHFF is a part of the larger Affordable Housing Leverage Fund, which is an initiative with the City of Detroit’s Housing & Revitalization Department and the Michigan State Housing and Development Authority. DHFF deploys flexible loan capital and private grants to complement and leverage public investment through the City of Detroit and Michigan State Housing Development Authority as well as tax credits and other existing affordable housing finance tools.
For more information on the Detroit Housing for the Future Fund and funding opportunities, please visit https://www.detroithousingforthefuturefund.org/ or https://www.liscstrategicinvestments.org/detroit-housing-for-the-future-fund
For investor inquiries and more information about LISC Fund Management, LLC, please visit https://www.liscstrategicinvestments.org/fund-management
About the Ebiara Fund
Ebiara is a fund to provide early-stage capital and process assistance so that minority-owned development companies can increase their impact on Detroit’s growing economy. A partnership between economic growth nonprofit Invest Detroit and real estate advisory firm URGE Imprint with funding from The Kresge Foundation, Ebiara is a loan fund with wraparound support, that seeks to address that gap by helping underrepresented development firms improve operating capacity, build a transaction pipeline, and secure the best talent available.
About Capital Impact Partners:
Capital Impact Partners is transforming how capital and investments flow into communities to provide people access to the capital and opportunities they deserve. We work to champion key issues of equity and social and economic justice by deploying mission-driven financing, capacity-building programs, and impact investing opportunities.
Capital Impact is part of the Momentus Capital branded family of organizations, including CDC Small Business Finance and Ventures Lending Technologies. Collectively, we offer a continuum of financial, knowledge, and social capital to help local leaders build inclusive and equitable communities and create generational wealth. This includes a comprehensive package of loan products, impact investment opportunities, training and business advising programs, and technology services that advance locally-led solutions.
A nonprofit Community Development Financial Institution, Capital Impact has disbursed more than $3 billion since 1982 to create access to critical social services, grow entrepreneurs, and create quality jobs. Capital Impact’s leadership in delivering financial and social impact has resulted in the organization being rated by S&P Global and Fitch, and recognized by Aeris for its performance.
Headquartered in Arlington, VA, Capital Impact Partners operates nationally, with local teams in Austin, TX, Dallas, TX, Detroit, MI, New York, NY, and Oakland, CA.
Learn more at capitalimpact.org or momentuscap.org.