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Redevelopment of Historic St. Louis Arcade-Wright Building

News | December 2, 2014

Kutak Rock partners Jill Goldstein, Gregg Yeutter and Beth Ascher and associate Asher Ball represented U.S. Bancorp Community Development Corporation as low-income housing tax credit (LIHTC) and historic rehabilitation credit (HTC) counsel in connection with the redevelopment of two historic high-rise office towers in downtown St. Louis. The two connected office buildings, originally constructed in 1919, are known as the Arcade-Wright building. The redevelopment will convert the office towers into a 500,000-square-foot modern mixed-use complex.

The deal was structured as two separate condominium transactions. Kutak Rock helped structure the LIHTC side of the transaction, which was paired with HTCs to construct 202 affordable housing units in the redevelopment. The project is one of the first and most high-profile deals in the nation structured under the new IRS Revenue Procedure 2014-12 with respect to lease pass-through structures utilizing federal historic rehabilitation tax credits.

A separate new market tax credit transaction closed simultaneously, financing the market rate units and commercial space in the project. Webster University will occupy the commercial space.

The project, sponsored by Dominium, a Minneapolis-based developer of multifamily housing and mixed-use projects, is expected to be fully completed by January 2016.

Debt financing in the LIHTC transaction was provided by U.S. Bank National Association, Cornerstone Permanent Mortgage Fund (Boston Capital Finance), Missouri Housing Development Commission, and the City of St. Louis, together with Missouri Affordable Housing Assistance Program tax credits.