Few things are as important to a Main Street’s health as having the capacity and capital to rehabilitate vacant and underutilized buildings or to add infill development to vacant sites. Usable space – for restaurants, retail, professional services, civic infrastructure, and housing – is the fabric of downtowns and neighborhood districts, and the foundation upon which local economies thrive. But we know that about 80% of Main Streets report that they don’t have the usable space they need, whether commercial or residential. What they do have in abundance is vacant and underutilized buildings that need some serious updates before they are viable as leasable space.

Getting investment capital for these projects is difficult; we explored this topic earlier this year in some depth after learning in detail the challenges that communities have repositioning buildings, especially smaller-scale structures. Our Small Deal Initiative is dedicated to connecting our network with new sources of capital and capacity building for these real estate deals.

New Funds for Development 

Last week marked an important win in creating a new potential source of low-cost capital for adaptive reuse projects on our Main Streets. The Environmental Protection Agency released its Notice of Funds Available for two critical programs, the National Clean Investment Fund (NCIF) and the Clean Communities Accelerator Fund (CCIA). Both programs are part of the $27 billion Greenhouse Gas Reduction Fund (see our blog from last month for more details), and both programs will pump billions of dollars into reducing carbon emissions from the built environment in the coming years.

At this point, you might be scratching your head and thinking, “What could that possibly have to do with old empty buildings on my Main Street?” Here’s how this news applies to Main Street leaders: adaptive reuse and location-efficient projects appear to be eligible for funding under the NCIF and CCIA programs (though there is a question about whether CCIA funds can be used for adaptive reuse). This is because significant carbon savings come from reusing existing buildings, especially when integrating energy efficiency improvements and renewables into those structures.

Beginning in the summer of 2024, grantees and subgrantees of the GGRF programs – like Community Development Financial institutions, green banks, and other community development entities – will begin providing low-cost loans and a range of other financial products that will help to support decarbonization projects, such as adding solar panels to buildings, electrifying and weatherizing buildings, and – critically – helping provide financing to adaptive reuse and infill with decarbonizing retrofits for housing, childcare centers and community facilities. The program is also expected to offer capacity-building technical assistance to projects, which we know is a critical and unmet need in our Main Street communities. A minimum of 40% of GGRF program dollars must be spent supporting work in low-income and disadvantaged communities, ensuring that our nation’s most disinvested places are prioritized for funding.

Advocacy in Action 

Main Street America, Smart Growth America, the National Trust for Historic Preservation, the National Trust Community Investment Corporation, and several other national organizations led an advocacy campaign over the last several months to urge the EPA to allow for the funding of adaptive reuse and location efficient projects under the GGRF program, given the sizable carbon benefits associated with reusing buildings. We were joined in this advocacy by more than two dozen MSA Coordinating program partners and the National Preservation Partners Network membership. A hearty “thank you” to all who participated in these essential advocacy efforts!