After four decades of putting roofs over Quad Citians’ heads, paychecks in their pockets and helping make development magic, the Rock Island-based Economic Growth Corporation is showing no signs of slowing down. As GROWTH enters its 41st year the nonprofit whose motto is “Making communities stronger: One life, one home, one project at a time” […]
After four decades of putting roofs over Quad Citians’ heads, paychecks in their pockets and helping make development magic, the Rock Island-based Economic Growth Corporation is showing no signs of slowing down.As GROWTH enters its 41st year the nonprofit whose motto is “Making communities stronger: One life, one home, one project at a time” has a full plate of programs and projects moving forward in the Quad Cities and elsewhere in 2023.In December 2022, a Who’s Who of Quad Citians gathered to celebrate a lean, mean housing and economic development machine that now spans 14 states and has over the past 40 years secured $500 million in financing for projects that have created 13,800 jobs. And what started as a nonprofit to grow Rock Island has evolved into a nation-leading complex organization that operates three effective wholly owned subsidiaries: Central State Development Partners, Inc., Home Base Management, LLC and GROWTH Central Contracting, LLC. As GROWTH’s longtime President and CEO Brian Hollenback said at the organization’s 40th Birthday gala in December at the Rock Island Brewing Co, “What we have accomplished is nothing short of a miracle.”Those accomplishments are even more remarkable, local leaders say, given its humble beginnings.GROWTH records its official startup as 1982, but can trace its roots to a trip Rock Island city leaders took to a National League of Cities convention in Michigan in 1981 where they learned about the Detroit Economic Growth Corporation.Four men who helped shape the Economic Growth Corporation — from left, Brian Hollenback, Mark Schwiebert, John Phillips and Dan Carmody — celebrate its 40th birthday. CREDIT GROWTH“I was still kind of a newbie on the council at that time,” Mark Schwiebert, a former longtime Rock Island alderman and mayor, recalled recently. “And some of us got together at the end of one of the days and over a cold foamy we started talking about the possibilities in Rock Island of creating an economic growth corporation.”Back at home in the Quad Cities, the farm crisis was in full force and leaders were casting about for ways to grow Rock Island back to prosperity. “Things were pretty grim in those days,” Mr. Schwiebert told the QCBJ. The community had just experienced “a really extended and divisive strike that occurred at the Farmall Works in Rock Island,” which he told the QCBJ “got pretty nasty.”That work stoppage combined with the plant’s eventual closing was a huge blow to the local economy. Farmall at one time employed 5,000 workers. Then, he said, came the grim news that the Case plant on the west side was closing, which would cost Rock Island more than 1,200 jobs. In all, Rock Island lost 20% of its population and 40% of its tax base.Those dark days required leaders to find innovative ways to help via public-private partnerships.Mr. Schwiebert, who is an attorney, helped set up the legal measures needed to get such a partnership underway. “That was the beginning of the Economic Growth Corporation which since then has evolved into what is really a very dynamic organization with not only a local presence but actually a regional and even national presence through its various incarnations and housing programs,” he said.Mr. Hollenback made his way to GROWTH courtesy of Dan Carmody, a former co-owner of RIBCO who was president of the development organization then called Renaissance Rock Island from 1988 to 2005. (Over time, that organization’s duties and other new ones were combined under the GROWTH umbrella.)In a phone interview from his current office in Detroit where he serves as executive director of the Eastern Market Corp., Mr. Carmody recalled how he had been looking for someone to take on the agency’s housing division when he ran into Mr. Hollenback at a meeting at the Martin Luther King Jr. Center in Rock Island. “I said, ‘We should talk,’” Mr. Carmody said. “I knew right away he was a great fit.”GROWTH began as a neighborhood entity focusing on economic need and diversity, Mr. Hollenback said. Early efforts included providing capital to redo homes in the Broadway Historic District and rejuvenating the new Old Chicago Neighborhood. In 1998, GROWTH merged with Rock Island Breachmenders. “So we were more neighborhood focused,” Mr. Hollenback said. “Then we became citywide, then regional, then statewide and then a national entity about 10 years ago.”He added: “Sometimes you’re victims of your own success and what really started driving the expansion efforts beyond just a citywide entity is that we were so successful with the millions of dollars that we were receiving in funding that one of our major funding sources said, ‘If you’re going to continue to receive the level of funding then you’re going to have to expand your service area in order to do so.’”Windows are being installed at Wilson Lofts in downtown Clinton, which is expected to celebrate its grand opening in March. CREDIT GROWTHSuccess breeds success. Consider, Mr. Hollenback said, it “is almost inconceivable” that as a relatively new community development entity, GROWTH’s Central State Development partners, managed to receive funding from three administrations six years in a row in excess of $220 million. “I think that is a clear demonstration that we’re doing phenomenal work in the communities that we serve.” Despite its expanded reach, however, the organization maintains its local focus and commitment to Rock Island and Quad Cities projects.
For example, among the QC area developments advancing in 2023 are:
Wilson Lofts, Clinton, Iowa: A grand opening is expected to come in March for the new housing development at 210-217 Fifth Ave. South. GROWTH’S property management subsidiary, Home Base Property Management, LLC, also is seeking a part-time leasing manager for the redeveloped downtown property that includes residential housing and two business incubators: Makers on 5th and Clinton Culinary.
Sala Flats, Rock Island: More than $2 million in new investments is coming in 2023 to the historically significant building at 1829 Fourth Ave. The original award-winning historic rehab was done by GROWTH in 2004 complete with units of residential rental housing. GROWTH Vice President Beth Payne said the organization will become sole owner and make substantial capital improvements to the property in 2023. The total project cost is $5 million.
Jackson Square, Rock Island: The property at 2411 Fourth Ave. was renovated and redeveloped by GROWTH in 2004 and that $8.8 million deal is one of the most complex completed by the organization. GROWTH is investing nearly $475,000 in capital improvements to the location.
Northside Lofts, Aledo, Illinois: Ground could be broken by the end of the year on this live-work project the community hopes will be an economic engine for Aledo’s historic downtown, Mr. Hollenback recently said. Meanwhile, GROWTH has been doing pre-construction work, which he expects to be completed soon. In mid-February GROWTH hopes to submit an application for the largest component of the financing and the gap financing needed to make the project happen.
As is usual in such complex deals, a complex financing arrangement is the key to getting things done, and on that score, fans say GROWTH delivers.“Brian is so good at working particular grants,” Mr. Schwiebert said. “I refer to it as lasagna financing.” The layers can include local, state and national resources, tax credits and grant programs, private financing, which all must come together at the right time.Among the early challenges is funding the predevelopment cost not knowing whether you’re even going to get the help you seek. Then it can take two or three times during competitive tax credit rounds to be funded. “During that period of time you have hundreds of thousands of dollars that you’re spending in predevelopment hoping that you receive an allocation,” Mr. Hollenback said. That means it can take many years for deals to happen and projects to begin, which is why local buy-in is critical to GROWTH’s decision to take on a project.It’s also why GROWTH goes into communities only by invitation since local support and partnerships are critical to making a success of the kind of complex and long-term deals that are necessary to make big projects happen, Mr. Hollenback said.In addition to headline-grabbing projects like Shimer Square, a $60 million-plus project to redevelop the former Shimer College and campus in Mount Carroll, Illinois, the laundry list of services GROWTH provides is made up of a host of smaller but equally impactful investments. They include ones that help families and individuals get access to capital; provide financial literacy education, help homeowners address housing health and safety code violations and energy efficiency issues; and provide rental assistance and mortgage payment assistance to those that have been underemployed or had a reduction in their income.GROWTH offers assistance at multiple levels and its housing and development programs are focused on growing communities through long-term partnerships, the organization said. Among the questions it asks before doing a deal are: how many jobs will be created; what are the wages; do they have benefits; is it a severely distressed community; can GROWTH provide financial education to new employees to empower with the ability to understand things like their credit scores. GROWTH also works to provide down payments and closing cost assistance.“It’s a pretty comprehensive package of empowerment to our communities addressing the needs of our most vulnerable populations providing access to capital to communities with emphasis on communities with lower income and communities of color that have previously struggled,” Mr. Hollenback added.And he clearly is proud of what the organization has accomplished. He stressed, however, that the credit for that belongs to everyone involved with GROWTH.“We have stayed true to our original mission,” he said. “We have survived the life cycles of many nonprofits and with the strong brave and bold decisions made by our policymakers, our board, and their ongoing and unwavering support for helping to rebuild communities, I think that has all contributed significantly to our successes. And right behind our board, of course, is the talent we have within our staff.”Mr. Hollenback added: “When we’re looking at our core staff, past present and future, the statement should be not to leave anyone out. That includes every person who has contributed tremendously to the successes not only during the time period in which they were employed but also setting the stage and helping to build a strong foundation for what we’ve accomplished and where we’re headed.”
