CitiHousing project brings 20-year total to $119M

November 1, 2013

From the Sioux Falls Business Journal
Written by: Brenda Wade Schmidt
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For 20 years, Citibank has helped ensure that low-income, disabled, elderly and other people in need of affordable housing had a place to call home.

The credit card bank through CitiHousing — Citi’s for-profit community development corporation — has invested $119 million to develop more than 2,600 housing units in Sioux Falls and several other communities in South Dakota since 1993. The bank’s most recent investment was $3.3 million to help build the $4.2 million Spring Centre, a 31-unit apartment building at 512 S. Spring Ave. that will open this week.

“You come to one of these events and you see the people you impact,” Ken Stork, Citibank site president, said at the recent Spring Centre ribbon-cutting and CitiHousing anniversary celebration. “It’s our pleasure to be involved.”

The bank helps fill a constant need in the community, those in the housing business say.

“There are a lot of families struggling to find affordable housing that’s safe and decent,” said Shireen Ranschau, executive director of Affordable Housing Solutions, a nonprofit organization. “We feel it’s our mission to try and make more opportunities available.”

The partnership with CitiHousing works this way: The bank invests in the project and receives federal tax credits over 10 years, which cover part of the investment. The remaining money is a gift. For the Spring Centre project, Affordable Housing Solutions came up with the rest of the money through loans, some cash and tapping into other programs, including Grow South Dakota and South Dakota Housing.

“They (CitiHousing) provide money up front to the project. Whatever money they put into it, there’s that less money we have to borrow,” Ranschau said. In addition, rents can be kept lower for the families.

At Spring Centre on the former Gigglebee’s block, for example, apartments will rent for $335 for a one-bedroom up to $765 for a three-bedroom. Tenants must meet income guidelines to live there, starting at $24,450 for one person and $34,900 for a family of four.

The development has seven one-bedroom units, 16 two-bedroom apartments and eight three-bedroom apartments, making it a place where families can live. It also includes two community rooms and an outdoor playground, and is part of the effort to reinvest in the Pettigrew Heights neighborhood.

CitiHousing’s first investment project in Sioux Falls was $431,076 to help build the Cumberland Apartments on North Fourth Avenue. It also helped with the new Pettigrew Heights Apartments on West 11th Street and is on board with money to turn the Sioux Falls YMCA into mostly affordable housing.

With five additional projects this year, that will bring the total number of developments to 71.

Stork said the bank is passionate about affordable housing and is the top leader among banks in the country for its involvement.

“I couldn’t be more proud of the impact we’ve had for people in need.”

Besides Sioux Falls, CitiHousing in South Dakota has invested in projects in Aberdeen, Brandon, Brookings, Crooks, Custer, Harrisburg, Hartford, Mission, Mitchell, Mobridge, North Sioux City, Pierre, Rapid City, Tea and Watertown.

Evan Nolte, president of the Sioux Falls Area Chamber of Commerce, said Citibank’s leadership in housing has been important to make Sioux Falls the successful community it is today.

“It’s just been a huge positive factor because a big part of economic development and community development is being able to create and have affordable housing opportunities,” Nolte said.