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State Gives $47M in Loans to Nine Projects

HARRISBURG, PA-The matching-fund loans from the Commonwealth Financing Authority represent the first chunk of Gov. Rendell's $150-million 'Building PA' stimulus program.

By Marita Thomas | Updated on December 04, 2006

HARRISBURG, PA-The state has handed $47 million in matching-fund loans to nine real estate development projects. The funding comes from the Commonwealth Financing Authority and is the opening component of Gov. Ed Rendell’s Building PA program.

In all, Building PA will provide $150 million to be matched by private investors and foundations in order to create a $300-million pool to serve as mezzanine capital for real estate developers, particularly in mid-size communities. The goal, according to Building PA guidelines, is to “close the funding gap” in facilitating projects in these areas, once developers have lined up a portion of the funding. Terms and rates vary by project.

The largest of the loans, $12 million, was awarded to Pittsburgh-based PenTrust Real Estate Advisory Services Inc. for establishment of Development Capital Investors Inc. It will focus on commercial real estate construction in underserved areas of the Southwestern counties. PenTrust operates Employee Real Estate Construction Trust Funds, which invests in projects using only AFL-CIO labor.

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