Country / Language

The Financial Anatomy of an NMTC Deal: The Centre Theater

July 2014

The following was distributed as part of the New Markets Tax Credit Connection - Summer 2014 newsletter.

by Amy Bonitz, Bonitz Palmer LLC 

In June 2014, Jubilee Baltimore, Inc. (Jubilee) – one of Baltimore’s thriving non-profit developers – closed on NMTC and historic tax credit leveraged financing for the historic renovation of the Centre Theater, a 65,000 square foot building in the heart of Central Baltimore. Vacant for more than 20 years, the Center Theater’s marquee and signature tower were falling apart, while a major hole in the roof led many to fear the building would be lost to demolition by neglect. Restoring this critical landmark in the heart of the Station North Arts and Entertainment district, the nation’s first special taxing district designed to support the arts, was met with unanticipated funding challenges and requirements. However, Jubilee was able to overcome these unforeseen roadblocks to enable the project – two years in planning – to come to fruition by utilizing a variety of equity sources, including state and federal historic tax credits and seven grant sources.

In 2012, Jubilee was selected by the Central Baltimore Partnership (CBP), a coalition of three anchor institutions, including Johns Hopkins University (Hopkins), the Maryland Institute College of Art (MICA) and the University of Baltimore, as well as neighborhood, non-profit and philanthropic partners to redevelop the building.1 Rich in history, the building was built in 1912 as a garage and converted into an art deco movie theater in 1939 as part of a booming arts and entertainment district that emerged along North Avenue, home to several historic theaters that flourished until the 1960s when riots caused major abandonment and disinvestment.

How would Jubilee secure funding to acquire the property? CBP partners, including MICA, a local foundation, and two neighbors, provided small loans enabling Jubilee to acquire the property at auction. The project got a major boost when the State of Maryland awarded half of its annual historic tax credit allocation to the project in December of 2012. Then in 2013, Hopkins and MICA decided to create a new, joint film program and selected the Centre Theater to house the 25,000 square-foot program. When it opens in September 2015, the joint program will be the first time that the two major anchor institutions have leased space together in the same building and the first Hopkins facility to be built in the neighborhood. The film program will also support the $18 million redevelopment of the historic Parkway Theater across the street, which will be renovated in 2016 as the new home to the Maryland Film Festival.

Having secured $3 million in state historic tax credits and a major tenant, Jubilee now required a federal historic tax credit investor and Community Development Entities (CDE) to provide allocation. Jubilee’s goal was to leverage the security of the long-term university lease to make the rest of the building available to non-profits, artists, and a local farm-to-table restaurant. Fortunately for Jubilee, Philadelphia-based The Reinvestment Fund (TRF) had already made a significant commitment to the neighborhood as part of a Living Cities initiative focused on anchor-institution driven community-development in Baltimore. TRF committed $6 million to the project and reached out to Telesis and Chase Bank to invest an additional $7.5 million in allocation in the project. The next challenge was placing the federal historic credits given the uncertainty of the Boardwalk case and subsequent IRS ruling. The project also had to meet a 70% pre-leasing requirement from TRF in order to place the long-term debt.

With leases from Hopkins and MICA, a consortium of community development non-profits called the Center for Neighborhoods, and a lease from the Baltimore Jewelry Center, the project was able to meet the pre-leasing requirements. However, in order to meet the new safe harbor rules, the project had to overcome an unanticipated $1 million funding gap. Due to the importance of the project to the State’s community redevelopment efforts, the State of Maryland came through to help close this gap, along with grants from MICA and Hopkins. Ultimately, the project was able to place the federal historic tax credits with Chase Bank.

Closing on the project’s financing took place at the end of June, and construction is now underway. The first tenant will open in April of 2015. The fully restored building, with its iconic theater façade and signature art deco marquee and tower, will be an anchor in the arts district. The collaboration of so many partners in the project’s financing has been an important victory for the collaborative placemaking underway in the nationally renowned Arts District, and to the larger effort, leveraging diverse partners in anchor-institution supported community development in Baltimore.


For more information, please contact Amy Bonitz, a consultant to Jubilee. For more information on CohnReznick’s New Markets Tax Credits Program services, visit our Resource Center

[1] The CBP is implementing a comprehensive community development strategy in 12 neighborhoods north of downtown Baltimore; the Centre Theater is one of five major vacant buildings in a three-block, highly-distressed area that is being redeveloped by various CBP partners.

The information contained herein (or in any attachment) is not intended to be used by any taxpayer for the purpose of avoiding any penalties that a taxing authority might impose on the taxpayer or for the promoting, marketing or recommending to another party any tax related matters.

The information in this transmission is privileged and confidential and intended only for the recipient listed above. If you are not the intended recipient, please advise the sender immediately by reply e-mail and delete this message and any attachments without retaining a copy. If you are not the intended recipient, you are hereby notified that any disclosure, copying or distribution of this message, or the taking of any action based upon it, is strictly prohibited.

This has been prepared for information purposes and general guidance only and does not constitute professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is made as to the accuracy or completeness of the information contained in this publication, and CohnReznick LLP, its members, employees and agents accept no liability, and disclaim all responsibility, for the consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it.

Search Our People

Search Our People

Look ahead. Gain insight. Imagine more. Is your business ready to break through?

View our new TV commercial..

Industry Outlooks

Industry Outlooks

Gain insight into what is ahead for the Commercial Real Estate, Technology and Middle Market Private Equity industries.


Learn about our upcoming events.


Working With Us

Working With Us

What makes CohnReznick different from others in our profession? And what should our clients come to expect when working with us? The answer is The CohnReznick Advantage. Contact us to learn how we can out the CohnReznick Advantage to work for your business.


The value of an organization is determined by the skills and qualities of its leaders. With more than 280 partners serving clients nationwide, CohnReznick is renowned for the diverse experiences, knowledge and backgrounds of its leadership.

Learn More


We align our services in three segments: Accounting and Assurance, Tax, and Advisory. This approach allows us to provide holistic solutions to complex business problems and to seize upon opportunities requiring an integrated approach.

Learn More


Accounting and tax issues different significantly based on an organization's industry. We provide clients with expertise in nearly two dozen industries – we know the opportunities, the obstacles, the competitive landscape.

Learn more


CohnReznick professionals are thought leaders in their industries. Clients benefit from relevant and timely economic, legislative and industry insights that can keep them a step ahead of competition.

Learn More

Global Reach

Our involvement in the Nexia International network of firms enables us assist our clients wherever they do business-providing local expertise and connections wherever they needed. Nexia is comprised of 20,000 professionals operating in over 100 countries.

Learn More