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CHICAGO DEPARTMENT OF PLANNING AND DEVELOPMENT
Tax Incremental Financing Assistance - Project Reviews
S. B.
Friedman & Company is one of the firms under contract to
provide assistance to the City of
Chicago
’s Department of Planning with regard to its tax incremental
financing program. Since 1997 the firm has reviewed the level and
structure of financial assistance for 40 proposed developments. They
include: office-to-residential conversions; historic rehabilitation
projects with office and residential uses; for-sale condominiums;
department stores; community shopping centers; dormitory conversion;
and proposed hotel projects, including proposed national-flag
corporate hotel properties.
The scopes of the reviews vary including, as
appropriate: review of market data; evaluation of capital development
costs (land, hard and soft); analysis of revenues and expenses; market
benchmarking of financing and investment parameters; and projection of
return on investment.
There is significant concern about the total
level of assistance using “pay-as-you-go” with a present value cap
as one of the principal structuring mechanisms. Recommendations have
been provided regarding both the amount and the structure of financial
assistance needed to achieve reasonable investment results.
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