Salvatore Arenella looked around the third floor of his downtown Aurora building at 30 N. Broadway and said he hopes to energy from the past will help inspire its future.
“This third floor was a dance floor once,” Arenella said Monday, smiling and taking a short dance step himself.
His buoyant spirit was due to the fact that he is now able to remodel the old, three-story building into two apartments and a first-floor store space. It’s thanks to a new revolving loan fund put together by a partnership of Invest Aurora, the city’s nonprofit redevelopment corporation; the Dunham Fund, a private foundation; and three local banks.
Officials held a press conference Monday to announce the fund’s formation and Arenella’s building as the first beneficiary.
The fund is designed to provide loan money to owners of older downtown buildings who have been unable to get traditional financing to do remodeling or renovation work.
In many cases, the owners cannot secure money because the cost of remodeling an old building is higher than its value. The revolving loan fund is designed to counter that financial quandary by offering loans at a low-interest rate, with no repayment required for nine months – allowing time for renovations to be done and the owners to find tenants.
In the case of Arenella, who bought 30 N. Broadway in 2012, he was unable to get traditional financing.
“And now it’s 2017, and the building is vacant,” he said.
According to David Hulseberg, Invest Aurora chief executive officer, the new fund will loan Arenella $235,000 for his renovations, which will be interest and payment free for nine months. At that point, a low interest rate will be added, and Arenella will begin paying the money back into the revolving fund, Hulseberg said.
“Basically, I don’t have to pay until the renovation is done, until I have a tenant,” Arenella said.
The Dunham Fund is endowing the revolving fund with $250,000 retroactive to last year, $500,000 this year, and $250,000 in 2018. Three local banks – First Midwest Bank, Old Second National Bank and Aurora Bank & Trust – will each add in $15,000. With the city of Aurora’s contribution, the total amount available will be $1.2 million.
“By providing access to economic opportunity, the (fund) allows building owners to create lease-ready spaces in the downtown that will increase business activity, bring additional jobs and revitalize our community,” said Stewart Beach, a Dunham Fund board member.
Hulseberg called the 30 N. Broadway building “a perfect example of a building with good bones” that will increase in value with the renovations. Arenella will have a two-bedroom apartment on the third floor, another apartment on the second floor – both bringing in revenue for him – and a 1,400-square-foot business space on the first floor that once housed Ziegler Music.
In addition to the money, the local banks, as well as the Waubonsee Community College small business development center and the U.S. Small Business Administration’s Women’s Business Development Center will collaborate to provide business plan help for property owners, Hulseberg said.
Invest Aurora estimates that if vacancies are reduced by one-half during the next three years, it will result in 43 new commercial spaces and 130 new jobs, he said.
The fund is looking at deals on LaSalle Street, and the owner of a building on Lake Street is considering applying for a loan, Hulseberg said.