SPRINGFIELD – The city has received a $ 5 million loan guarantee from the US Department of Housing and Urban Development that will be used to finance the purchase of properties and stabilization efforts in its Main Street / Convention District near MGM Springfield.
The city council accepted the loan request in March. Having the loan collateral in hand means the city can use the financing if and when a worthy project arises.
“This loan guarantee is one of the most effective investment tools that HUD offers to local governments,” said Robert Forti, the agency’s deputy regional administrator for New England. “We commend the city leaders for their continued commitment to downtown revitalization.
The HUD Section 108 Loan Guarantee Assistance Program enables local governments to borrow at reduced interest rates to promote economic development, boost employment growth and improve public amenities, the government said in a press release.
With the loan guarantee, the city could buy dilapidated properties, stabilize them and prepare them for new development. The target area is generally bounded by East Columbus Avenue / Interstate 91, Harrison Street, Chestnut Street and Union Street and includes the MassMutual Center.
In August, the city announced its intention to use $ 2.75 million from the American Rescue Plan Act to purchase three buildings that Freedom Credit Union had taken in a foreclosure sale in December 2019. These buildings are the : 113-115 State St., 1139-1155 Main St. and 11-21 Stockbridge St.