Success Story - Boston, Massachusetts

Information by State  Print version   Related Information Location: Boston, Massachusetts Project: Spire at 65 Bay Street, LLC Grantee: City of Boston Programs: HUD Programs Sec. 108, EDI, CDBG Other Federal Programs EDA (Commerce), OCS (HHS) Non-Federal Programs Boston Community Capital, CDC Business Loan & Equity Fund, FleetBoston (bank), LIFE Initiative (state program funded by life insurance cos.), Local Initiatives Support Corporation (LISC), Massachusetts Bay Transit Authority, Massachusetts Development Finance Agency, NSTAR (electric co.), Riley Foundation, Barr Foundation Funding: HUD $1,925,000.00 Federal $3,412,000.00 Nonfederal $9,885,657.00 TOTAL $15,222,657.00

Boston, Massachusetts

The long-abandoned Boston Insulated Wire and Cable factory building at 65 Bay Street was infamous for arson fires in the late 1980s and a major blighting influence on the Savin Hill neighborhood in the Dorchester section of the City of Boston. In 1994, Dorchester Bay Economic Development Corporation (DBEDC), the local CDC, negotiated with lien holders to forgive a $9.5 million mortgage and bought the 4.7-acre property. DBEDC demolished the structure and worked closely with local and state officials to remediate the site.

DBEDC's goal was to find the "right fit" with the community, including tenants of a 300-unit senior citizens complex abutting the property. After considering several possibilities, including a Chinese noodle factory, DBEDC decided on Digipress, Inc., dba Spire, a graphics and web-site design and digital printing business. Spire hoped to combine both their existing Boston facilities to this site and expand their business operation.

DBEDC created a limited liability company with itself as sole member, Spire at 65 Bay Street LLC, to be developer and owner of a new 80,000 industrial building. DBEDC brought together a total of 17 public and private funding sources to complete the project. These include Federal, state and local government, nonprofit lenders, foundations, and a commercial bank. The complicated financing structure consists four layers of debt (with the HUD Sec. 108 loan sharing second position), recoverable grants and equity-like debt, and deeply subordinated debt/equity (including the EDI grant).

The project broke ground on June 12, 2001. Construction proceeded on schedule, despite the fact that nothing went easy. Workers had to sink 400 pilings to support the building and the printing presses. Spire took occupancy in the summer of 2002. The official ribbon cutting ceremony was held on October 2, with Boston Mayor Thomas Menino welcoming Spire and its 120 employees. HUD was among DBEDC's many "partners" publicly recognized with a thank-you plaque.

Spire's recent move to the former brownfield site has already resulted in significant improvements for all parties. In addition to the obvious-an attractive new industrial building with landscaped grounds in place of a contaminated brownfield-there are already two new restaurants in the immediate neighborhood, and a privately developed 7-unit apartment building is under construction next door. Spire's business is growing, with printing and mailing orders from customers including Staples and Sotheby's International Realty. The City of Boston is receiving approximately $110,000 per year in property taxes.

Finally, there are new job opportunities for City residents, who can easily commute to work at Spire through the adjoining MBTA Orange Line Savin Hill station. In addition to the original Sec. 108/EDI financing to DBEC, the City of Boston is making a separate working capital loan totaling $375,000 of Sec. 108/EDI assistance to Spire to pay for costs related to the move. Spire is committing to create approximately 60 full-time equivalent permanent jobs in addition to retaining 120 existing jobs now located at the Bay Street site. The new jobs will primarily be made available to low- and moderate-income persons. Wages will exceed minimum standards of the City of Boston's Living Wage ordinance.