MINNEAPOLIS -- Seward Co-op has received a significant source of funding towards the construction of its second store. Last month, the co-op was awarded a New Markets Tax Credit (NMTC) allocation of $8 million by the Midwest Minnesota Community Development Corporation (MMCDC).
The NMTC program was created in 2000 as a means to spur community development in low-income areas. Seward Co-op was one of the first food co-ops in the country to use the program in the construction of its Franklin store. Since then, Seward Co-op has been able to share its experience with several other food co-ops in their expansion efforts.
As the NMTC program has grown in popularity, competition for the allocations has grown as well. The success of the Franklin store made Seward Co-op an excellent candidate for another allocation.
“Our development partner, MMCDC, was excited to work with us again,” said Sean Doyle, Seward Co-op’s General Manager. “Choosing us as a recipient of their limited NMTC allocation is a testament to our track record of creating living-wage jobs and increasing access to healthy food.”
The co-op expects to create approximately 100 new jobs upon opening the new store, while also bringing a community-owned grocery to a neighborhood without access to fresh, healthy food.
The co-op’s previous NMTC allocation will result in more than $2 million of debt forgiveness in 2015, which helps make the current expansion efforts possible. The new NMTC allocation will also result in substantial debt forgiveness.
The next step in the process for Seward Co-op is finding a bank to finance the project. Because obtaining bank financing for a small business expansion often can be difficult, the NMTC allocation makes the project more attractive.
“This will help ensure that we are able to build a store with the same type of facilities, services, and high environmental standards as our Franklin store,” Doyle said.
Seward Co-op’s second store, the “Friendship” store, will be located in the Bryant-Central neighborhood at the intersection of 38th Street and 3rd Avenue. The store is projected to open in the summer of 2015.
Contact
Tom Vogel
