On June 15, 2023, Detroit Mayor Mike Duggan, members of the Detroit City Council and Detroit developer Edward Carrington of Flux City Development broke ground on a new multi-use affordable housing redevelopment project on Detroit’s east side.
The $8.2 million development called “The Ribbon” is the largest redevelopment along the E. Warren Ave. corridor in decades, and will bring another 18 units of brand-new affordable housing to Detroit.
Demolition of an existing former bank building on the site was recently completed, and construction on The Ribbon is expected to be complete in the Fall of 2024.
The Ribbon is the first project from Edward Carrington and Flux City Development, an emerging developer of color based in Detroit.
The redevelopment project will provide 18 new affordable apartments, all below market rate to make them affordable to Detroiters living in the area.
Fourteen of the apartments will rent at or below 80% AMI, while four of the units will be available at or below 60% AMI. Under the terms of the agreement, affordability of the apartments is guaranteed for the next 25 years.
“The Ribbon is bringing much needed affordable housing to the area, as well as real excitement and momentum to this important commercial corridor on East Warren,” said Mayor Duggan.
“East English Village and Morningside residents will be able to enjoy new retail, restaurants, and the new streetscape being built here, thanks to investments from the Detroit Housing for the Future Fund and Strategic Neighborhood Fund,” he added.
In addition to the residential space, retail on the first floor will be occupied by a local foodie favorite, Gajiza Dumplings, which will make the Ribbon its first permanent home.
“I can’t think of a better first project for Flux City,” said Carrington. “I am grateful for the support of both the Detroit Housing for the Future Fund and the Strategic Neighborhood Fund and other partners that helped make this a reality. I’m also thankful for the support of my new neighbors along the East Warren corridor. This is going to be the place to be in Detroit.”
Funding from SNF and DHFF
The $8.2 million redevelopment was made possible by $600,000 in loans from the Detroit Housing for the Future Fund. The Strategic Neighborhood Fund also provided a $1.4 million grant to the development. The development also received $338,199 in DHFF Preferred Equity, $2.2 million from Capital Impact Partners, CIP EDI grant of $75,000, and $1.3 million investment from Michigan Economic Development Corporation.
“For 18 years, I’ve lived two blocks from this location and I can remember so many years when this was a blighted corridor and we were doing everything we could to salvage properties. Initially, we probably thought it was all for naught, but we’re here today,” said Council Member Latisha Johnson.
“It took all of us coming together collectively and intentionally to ensure we are revitalizing our neighborhood commercial corridors. Detroiters do development differently as evidenced by the deep affordability in a market of rising rental rates and property values,” she explained.
In addition, the project qualified for a DHFF Developers of Color Matching Grant, designed to grow the pipeline of minority-led affordable housing and preservation projects in Detroit. It offers up to $100,000 in matching funds to cover a portion of a project’s predevelopment expenses and soft costs. The grants are made possible through a partnership with JPMorgan Chase.
“DHFF and LISC Detroit are succeeding in expanding affordable housing options for Detroiters,” said Camille Walker Banks, executive director of LISC Detroit. “Just as important, the Developers of Color Grants are ensuring that Detroiters and people of color have real opportunities to be the builders of these spaces.”
DHFF, a private investment fund aimed at directing capital to creating new and preserving existing affordable housing in Detroit, is anchored by a $15 million commitment from JPMorgan Chase of the fund’s total $58 million raise and a $10 million guarantee from The Kresge Foundation. DHFF is managed by LISC Fund Management, LLC, a subsidiary of Local Initiatives Support Corporation (LISC).
LISC Detroit sources and originates loans for DHFF. DHFF is a part of the larger Affordable Housing Leverage Fund, which is an initiative with the City of Detroit’s Housing & Revitalization Department and the Michigan State Housing Development Authority (MSHDA). Including the Ribbon, the DHFF has now funded 13 projects totaling 435 new or preserved affordable units in the city.
The Ribbon is also partially funded out of Detroit’s Strategic Neighborhood Fund, a $150 million initiative launched in 2016 by Mayor Duggan and Invest Detroit with a focus on leveraging investments in four key areas: improving parks, streetscapes, commercial corridors and single-family housing. All along the way, the plans are guided by resident input, empowering them to decide the future of their neighborhoods.
The fund was piloted with a $42 million investment in three initial neighborhood areas: Livernois/McNichols, Southwest/Vernor and Islandview/Greater Villages. Two years later, the SNF initiative was expanded to seven more areas and funded by an investment of $5 million each from seven corporations: American Axle, Blue Cross Blue Shield of Michigan, Chemical Bank, Fifth Third, Flagstar Bank, Huntington, and Penske. Blue Cross Blues Shield of Michigan is the corporate sponsor for the East Warren/Cadieux area of SNF.
“Providing sustainable, equitable solutions to improve the East Warren/Cadieux neighborhood has been a key focus for us as a strategic neighborhood partner,” said Ken Hayward, vice president and special assistant to the president for Community Relations at Blue Cross Blue Shield of Michigan. “The Ribbon development has brought many stakeholders to the table to identify how we can best help residents and their families, and this project affirms our commitment to bridging disparity gaps and improving the health and well-being for everyone.”
Community engagement is an important component of any project that falls under SNF. Neighborhood residents and organizations are consulted on projects, and the types of developments they feel would be most beneficial to the neighborhood.
“This is one of the most significant changes to the landscape here in decades,” said Joe Rashid, executive director of the East Warren Development Corporation. “We already are seeing renewed interest in commercial leasing due to the streetscape improvements. The Ribbon will add a lot of new neighbors and more excitement to the area, and those of us in East English Village and Morningside can’t wait to welcome them.”
“We appreciate the opportunity to highlight the continuing work of the SNF,” said Keona Cowan, executive vice president of lending for Invest Detroit. “By thinking about the whole neighborhood, from affordable housing, equitable development, placemaking, recreation and more, we are creating a Detroit that really has something for everyone.”
Invest Detroit is a mission-driven nonprofit lender, investor, and partner that supports business and real estate projects that will ignite economic growth in Detroit and the region. Their goal is to increase density and job opportunities in a way that is strategic and inclusive.
All photos courtesy of the City of Detroit.