Predevelopment financing assists both individual developers and community organizations by providing funding for costs incurred in the early stages of a project, such as environmental studies or appraisals that facilitate the project’s pursuit of traditional financing.
Predevelopment loans may be utilized for commercial, residential and mixed-use development projects in targeted areas of Detroit.
- Housing Development Projects Including Multi-Family and Mixed-Use Developments
- Commercial Projects That Have Potential for Significant Positive Impact on the Community
The targeted area for the Predevelopment loans is Detroit’s Woodward corridor, a 7.2 square mile area. For nonprofit and community development projects, the entire City of Detroit may be eligible.
- Land Acquisition
- Environmental Reports
- Legal Work
- Tax Credit Consultants and Fees
- Site Planning and Design
- Survey Work
- Construction Required to Preserve the Structural Integrity of a Building
General Loan Criteria
- Description of the project, including location, whether it is new construction or rehabilitation, year built, total square footage, number and square footage of housing units created, project ownership, and key project members;
- Detailed project budget that outlines all sources and uses and loan amount requested, including amount and source of owners’ equity investment, detailed itemization of professional fees and other expenses, total construction hard costs, total construction soft costs, etc.