Fox Theater Campaign Gets $7 Million Boost
Capital infusion from first-time pairing of federal Historic and New Markets Tax Credits represents major milestone in restoration effort; re-opening set for Fall 2007
Spokane, Wash. (October 4, 2006) – The Fox Theater, an historic Art Deco theater under restoration in downtown Spokane, today announced it has secured investments totaling $7 million through partnerships that utilize Historic and New Markets Tax Credits. This support lifts the capital campaign to $23.7 million and puts the project on track for completion by Fall 2007.
The investments are the result of partnerships formed with U.S. Bancorp Community Development and Investment Corporation (U.S. Bank) and Enterprise Community Investment, Inc. (Enterprise). The agreements make use of federal economic incentives programs that facilitate significant corporate investment in historic projects and low-income areas.
Restoration work on the Fox Theater meets eligibility requirements for federal tax credits through the Historic Tax Credit and New Markets Tax Credit programs. U.S. Bank receives Historic Tax Credits from the Fox Theater and New Markets Tax Credits through its partnership with Enterprise, a U.S. Treasury Department-certified "community development entity" through which the New Markets Tax Credits were allocated.
"We are delighted to work with U.S. Bank and Enterprise to utilize this economic incentive to bring the Fox Theater restoration closer to completion," said Peter Moyé, chairman of the Fox Theater Board of Trustees. "This transaction will bring millions of dollars of new capital into Spokane, help preserve one of Spokane’s most significant historic buildings, create a new regional center for the performing arts and a home for the Spokane Symphony, and reinforce Spokane’s role as a center for arts, culture and entertainment."
The Fox is listed on the National Register of Historic Places, and the architectural plans for the restoration comply with the Secretary of the Interior’s Standards for Rehabilitation, making it eligible for Historic Tax Credits. The theater’s location in a low-income census tract qualifies it for New Markets Tax Credits.
While other Spokane projects have used Historic Tax Credits, New Markets Tax Credits have not previously been utilized here. The credits, which are designed to stimulate community development and economic revitalization, have been used on historic preservation and real estate development projects in Portland, Ore., St. Louis, Madison, Wis., Tacoma, Wash., Salt Lake City and Seattle among other cities.
U.S. Bank has participated in the rehabilitation of the historic Atlas Theater in Washington D.C. and is currently finishing the conversion of the historic Armory into a new theater for the Portland Center Stage. Other historic theaters that have utilized the combination of Historic and New Markets Tax Credits include Knoxville's Tennessee Theatre, the Colonial Theatre in Pittsfield, Mass. and the Stanley Theatre in Utica, N.Y.
"This is an innovative and creative move by the Fox Theater, and a great use of resources, which we think can be a model for others in the community," said Mayor Dennis Hession. "The Fox Theater project is creating jobs, rescuing an entire city block, and contributing to our regional economy with a projected economic impact of about $16 million annually once it opens. The entire region will benefit."
A recent economic impact study conducted by Washington State University forecasts the theater will be an economic generator for the region. The restoration project will create up to 175 jobs and generate an estimated $57 million in economic activity during construction and the first year of operation. Direct, indirect and induced economic activity from the theater’s operation is projected to reach $16 million annually.
"Restoration of this Spokane landmark furthers the goal of the Historic Tax Credit program and of U.S. Bancorp Community Development Corporation to provide assistance for projects that serve as catalysts to economic development in communities across the country," said Rob Wasserman, Western Region Vice President of U.S. Bancorp Community Development Corporation for Historic and New Markets Tax Credit.
US Bank's Private Banking office in Spokane is providing construction financing for the Fox renovation project. "Our Spokane office was critical in the origination of the investment, and we are honored to be a part of this momentous project undertaking," said Region President Bob Wigren.
"This is a great example of how the New Markets Tax Credit program is having a positive impact on communities nationwide," said Enterprise Senior Vice President Joe Wesolowski. "As the largest New Markets Tax Credit allocatee, Enterprise has been able to leverage these credits to make great strides in comprehensive community development. We're helping transform vacant, historic buildings into thriving community assets. A restored Fox Theater will help revitalize downtown Spokane, while presenting construction and permanent employment opportunities."
The investments put the Fox on schedule to reopen in Fall 2007. Total project costs for the restoration are estimated at $31 million, reflecting recent increases in the cost of steel, concrete and other materials, some of which have risen by as much as 30 percent since the project was originally developed. The theater has raised money from private, federal and state sources and needs $7.3 million more to complete the campaign.
"We’re entering the home stretch for this capital campaign," added Moyé. "In addition to these significant funds which come from outside the community, we will continue to seek support from local corporations, individuals and public sources to raise the curtain on the restored Fox Theater next year."
Restoration of the theater began earlier this year with selective demolition and preliminary restoration of the artwork and other key architectural elements of the 1931 landmark. The funding secured through the tax credits partnerships will help preserve and restore original Art Deco features, murals, and lighting; expand the lobby; add an elevator and handicapped accessibility; add restrooms; replace heating, air conditioning, electrical and plumbing systems; add dressing rooms for groups and guest artists; and purchase specialized equipment such as an acoustic shell and other theatrical equipment for the 1600-seat theater.
About the Fox Theater
The historic Art Deco structure has been a significant Spokane landmark since it opened in 1931 and was in constant operation as a movie palace and performance facility until 2000, when it was threatened by demolition. Broad-based community support saved the Fox from the wrecking ball and the independent, non-profit organization which owns and operates the facility is overseeing the restoration. When complete, the Fox will be home to the Spokane Symphony, and will provide a mid-sized venue for a variety of performing arts, entertainment, business and private events.
About U.S. Bancorp's Community Development Corporation
With assets of nearly $2 billion, U.S. Bancorp's Community Development Corporation (USBCDC), based in St Louis, is one of the largest New Markets Tax Credit (NMTC) investors in the country. A subsidiary of U.S.Bancorp (NYSE: USB), the sixth largest financial holding company in the United States with assets of $210 billion, it makes equity investments in low-income housing and historic tax credits. The Company operates 2,434 banking offices and 4,941 ATMs, and provides a comprehensive line of banking, brokerage, insurance, investment, mortgage, trust and payment services and products to consumers, businesses and institutions. U.S. Bancorp is the parent company of U.S. Bank.
About Enterprise Community Investment, Inc.
Enterprise Community Investment, Inc., a Maryland-based community development organization, is the leading allocatee of New Markets Tax Credits in the nation, and brings over 20 years of real estate finance expertise and a full range of community development products and services to help revitalize and sustain communities nationwide. A leading provider of the development capital and expertise it takes to rebuild communities, Enterprise leverages tax credits and other resources to capitalize projects that make a catalytic difference in communities. For over two decades, Enterprise has privately raised $7 billion in capital to finance affordable housing, create vital communities and help transform the lives of low-income Americans. Currently, Enterprise is investing in communities at a rate of $1 billion a year.
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