Case Study
Not For Profit Social Enterprises: Funded with HUD 108 Loans, IDA Bonds and New Market Tax Credits
Photo credit: Cybul and Cybul Architects
Greyston Bakery, Yonkers, New York
The Greyston Foundation is a national model for comprehensive community development, recognized as a pioneer in social enterprise. ShermanLaw represents the Foundation in many of its endeavors, including development of affordable housing with primary care facilities for individuals with HIV/Aids. Greyston uses entrepreneurship to solve the problems of the inner city and reduce reliance on external funding sources. The Foundation offers an integrated network of not-for-profit and for-profit companies in Yonkers, NY providing jobs, workforce development, affordable housing, youth services, and health care.
ShermanLaw represented the Foundation when it decided to expand its social enterprise affiliate, the Greyston Bakery. The Greyston Bakery, created in 1982 to provide quality products and much needed jobs for fellow community members, turned a small storefront property into a major supplier of quality desserts for top-rated NYC restaurants and brownies for Ben & Jerry’s brand ice cream. Having outgrown its original facility, Greyston planned a magnificent 23,000 square foot bakery, designed together with world famous architect Maya Lin.
Brought on board at an early Project stage ShermanLaw irst handled problems related to a railroad right of way (which affected the proposed bakery site); and potential brownfields restrictions and liability. The planned project called for an environmentally sensitive building developed on a 1.61 acre parcel only a few blocks from the original site on the banks of the Hudson River.
ShermanLaw continued as primary legal representative during the critical financing phase. Project financing totaled $9.4 million and incorporated the use of IDA Bonds, HUD Section 108 loan funds, and a mix of private, nonprofit and government resources to address the gap financing and brownfield remediation costs for the site.
ShermanLaw represented Greyston Foundation by negotiating and closing on the following tax exempt and new market financing:
- City of Yonkers IDA Bond (Real Estate Bond)
- City of Yonkers IDA Bonds (Equipment Bond)
- Nonprofit Finance Fund Loan
- HUD Section 108 Loan
- Brownfield Revolving Loan
- Brownfield Revolving Grant
- City of Yonkers Loan New Market Tax Credits
- HUD EDI Grant
- Empire State Development Grant
- City of Yonkers Grant
- KCDC/Key Bank investment
The profits of the bakery support the Greyston Foundation’s mission of creating affordable housing and social services for low-income residents. The bakery helped to transform the area and provide community renewal by providing on-site training and fair wages and benefits for 65 local residents.
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