JPMorgan Chase says $34M already committed to Detroit
Detroit — One year after pledging to invest $100 million in Detroit over five years, JPMorgan Chase & Co. says $34 million has so far been committed in the Motor City. On Monday, CEO and chairman Jamie Dimon vowed to continue to work with Detroit in workforce training, small-business expansion and blight removal.
Nearly half of the $34 million went to two local financial firms, Invest Detroit and Capital Impact Partners. In turn, those two firms have used $10.6 million to support six projects. Three of those projects were in Midtown, the neighborhood north of downtown that is attracting increasingly upscale retail and residential.
“One year in, our commitment is yielding positive results,” Dimon said as he stood with city officials in the gutted first floor of a building undergoing a massive renovation in downtown’s Capitol Park.
The building, at 1145 Griswold, is an 11-story, historic structure that curves around the corner of Griswold and State. JPMorgan provided more than $32 million in debt and equity financing for the building’s renovation, which will create 63 market-rate apartments and three floors of commercial space. It is an example of how the global financial services firm is investing in the city through other programs.
JPMorgan says eventually $50 million of its $100 million Detroit pledge will be used for loans and grants to be awarded by Invest Detroit and Capital Impact. The local investment funds often finance projects that can not get traditional lending from financial institutions like JPMorgan. Invest Detroit and Capital Impact invest in housing, commercial and manufacturing projects.
Another $25 million will be used to tackle blight and stabilize neighborhoods. About $12.5 million will be for workforce training; $7 million for small business growth; and $5.5 million in infrastructure development.
The $100 million pledge garnered JPMorgan a lot of positive press last year. It was the same year the global firm agreed to pay a $13 billion settlement over its sale of mortgage-backed securities before the housing crash. It was the largest settlement ever between the U.S. government and a U.S. corporation.
JPMorgan also has settled other multimillion-dollar agreements for a wide range of financial misconduct. In January, the Wall Street Journal tallied JPMorgan has paid more than $25 billion in settlements over the past two years.
The Detroit programs that will get JPMorgan funding this year include the development of a map to highlight where jobs are in the city and the skills needed to fill them.
It also will provide $500,000 to help 350 young people find summer jobs. A home restoration program will be expanded to provide financing for homes sold outside the Detroit Land Bank Authority online auction.
Another $225,000 will go to support income tax assistance and financial coaching for residents and small businesses.
The commitment is making a real impact on the city, Mayor Mike Duggan said in a statement. “With their support, innovative programs are investing in new housing, more people are graduating from job training programs, rehab loan financing is available to home buyers and there’s greater support for small businesses.”
JPMorgan projects in Detroit
Some of the development projects to which JPMorgan funds went in 2014:
■$3.7 million to restore Midtown’s Rainer Court into rental apartments.
■$2.2 million to complete build-out of Willys Overland Commercial development in Midtown. Retail tenants include Shinola and Jolly Pumpkin stores on the Canfield side of the building.
■$1.5 million to buy and renovate the two-building, 80-unit Granada Apartments in northwest Detroit.
■$1 million of upgrades at Global Titanium Inc., a metals recycling company on the east side.
■$660,000 to rehab The Shoppes at Woodward, an empty 3,5000 square-foot-building at West Grand and Woodward.
Source: JPMorgan Chase