Press Release – HIT Revs Up Midwest Financing with Trio of New Projects

“The shortage of affordable housing throughout the Midwest and the negative impact of the pandemic made it even more important to increase affordable housing production in these communities” Chang Suh, CEO and Chief Investment Officer of AFL-CIO HIT, said.

“After weathering COVID, the manufacturing and construction sectors are now contending with rising costs and the highest rate of inflation since 1981. This is especially true in the Midwest where inflation is higher than the nation as a whole” Paul Sommers, HIT Regional Marketing Director, said.

HIT’s latest financing round backs major building initiatives in Decatur, Duluth and Toledo

HIT’s three Q1 2022 projects —The Southern Hills and Orlando apartment buildings, the Zenith Apartments and the Toledo Innovation Center — will improve their communities by supporting workforce development, creating union construction jobs and adding much-needed affordable housing units.

The Decatur-area development includes the rehabilitation of both Southern Hills and Orlando apartment developments. Southern Hills features 28 buildings on 10 acres offering 125 units of 100% subsidized family housing. The Orlando is an 87-unit apartment building that provides subsidized housing for seniors and individuals with disabilities. The HIT is providing $21.8 million in financing. The project has an estimated $40.9 million in development costs. The Southern Hills & Orlando rehabilitation project is expected to produce 109,000 hours of union labor with an overall economic benefit of $38.9 million.

The Zenith Apartments project involves the conversion of Duluth’s Historic Old Central High School, an 1892 building listed on the National Register of Historic Places, into a 122-unit mixed-income apartment complex. Ten percent of the units will be reserved as affordable for residents at or below 60% of the Area Median Income. HIT will provide financing for $26.7 million of the estimated $49 million development cost. The project is estimated to create 334,360 hours of union construction labor and an economic benefit of $90.6 million.

A historic 107,000-square-foot building constructed in 1911 will be converted into the Toledo Innovation Center, a state-of-the-art innovation and technology training facility to serve as an incubator for local tech start-ups and a training site and workspace for underrepresented adults. The building was originally Toledo’s central U.S. Post Office and later converted into the Jefferson Center for Vocational Rehabilitation by the Toledo Public Schools. Building America CDE, a HIT subsidiary, has allocated $10 million in New Markets Tax Credits to the project. It is estimated this project will generate nearly 400,000 hours of union construction work and produce a total economic benefit of $63.0 million.

Midwest@Work and city-focused investment give union construction jobs a significant boost

The initiative’s footprint includes the states that border the Great Lakes, from Upstate New York to Minnesota. Ten metropolitan areas – Buffalo, Chicago, Cleveland, Columbus, Detroit, Minneapolis, Milwaukee, Pittsburgh, St. Louis, and St. Paul – are the focus of investment. It has translated into investments in 58 projects so far, creating an estimated 21.0 million hours of union construction work, 28,447 jobs across industries and 8,811 units—5,039 of which are designated as affordable—for an estimated economic impact of $5.1 billion.

“Densely populated areas need more investments in housing and career opportunities for the residents,” said Suh. “HIT’s continual investment in the Midwest has had a significant and long-lasting impact on these cities and their communities.”