A bold vision for a derelict building, combined with expertise in structuring capital stacks with tax credits, has sparked multiple redevelopment projects in Upton.
The vision began with Dr. Alvin Hathaway, CEO of Beloved Community Services Corporation, who set out to transform the former PS103 building into the Justice Thurgood Marshall Amenity Center. Built in 1877, the Division Street building became vacant in the mid-1990s and suffered extensive damage, including from a fire in 2016.
After winning a state RFP to redevelop the property, Hathaway began pursuing his idea of creating a center that provided legal, health, and employment services to the community; served as an event space; and celebrated the legacy of Thurgood Marshall, who attended school there.
The venture faced three major financial challenges.
The first was raising funds for the $14 million renovation. Hathaway secured state, city, and philanthropic support, but the venture also needed state and federal historic tax credits and new market tax credits.
“The unfortunate thing about new market tax credits is you really have to be an insider to secure them and structure them,” said Carla Hinson, Director of Development Advisory at Cross Street Partners. “Finding new market allocation is not easy, and it is unpredictable when an allocation will become available, so it’s always difficult to plan your project around this source of capital.”
Within 18 months, however, Cross Street Partners secured sufficient tax credits to close on the project’s financing.
Second, securing insurance for “a vacant building with fire damage in a community that has been under-resourced was a major problem,” Hathaway said. “I could not find an insurance company in America that would insure that building.”
A policy wasn’t secured until he reached out to Lloyd’s of London.
“Getting an appraised value was the final big challenge,” he said.
The lasting impact of redlining has made it difficult for developments in Upton and other city neighborhoods to secure satisfactory appraisals.
“Fortunately, we have one of the country’s best real estate companies and appraisal companies right here in JLL,” Hathaway said. “JLL did their due diligence well. They did not allow themselves to be tempted by historic bias. They compared this restoration to downtown developments of similar ilk, and we were able to get an appraised value that allowed financing to feel assured and come into the project.”
Since its opening in 2024, the Justice Thurgood Marshall Amenity Center has leased more than half its space to organizations specializing in legal services, public health and job training.
And the development has spurred other projects.
On nearby streets, projects are underway or in planning to rehab vacant buildings, construct infill housing, and erect small apartment buildings. Beloved Community Services is renovating a former historic law office. Construction will wrap up this year on the $16 million transformation of Upton Mansion into a new headquarters and archives for the Afro American Newspaper.
This summer, Beloved Community will partner with Morgan State’s School of Architecture and AIA Maryland to conduct a design charrette to devise additional ways of revitalizing what Hathaway calls Freedom Square – a multi-block section of Upton.
“There are a lot of separate pieces, but they are all coming together,” Hinson said. “This area will look very different in the next five years.”
Featured in this article: Beloved Community Services Corporation, Cross Street Partners, JLL.