The building trades unions in Northeast Ohio are using their financial muscle to build the region and keep their members working.
The pension and health and welfare funds supported by many of the 31 unions or district councils in the Cleveland Building & Construction Trades Council (CBCTC) are investing in or lending millions of dollars to many of the most significant real estate developments in the region.
For example, the Employee Real Estate Construction Trust Funds, or ERECT Funds, put $13 million into the $116 million, 20-story One University Circle residential complex that towers over University Circle. It also provided a $9.6 million subordinated bridge loan for the conversion of the former East Ohio Gas Building into 223 luxury apartments, The Residences at 1717 East Ninth Street.
More recently, the AFL-CIO Housing Investment Trust (HIT) agreed to direct the proceeds of a $43 million bond issue created by the federal Government National Mortgage Association as a first mortgage on the $56.9 million Church & State mixed-use project in Ohio City.
“We are not your grandfather’s building trades unions,” said David Wondolowski, executive secretary of the CBCTC. “We have a robust capital strategies program that is very enticing for developers today.”
Wondolowski said that developers are now coming to the unions early in the development process because of the variety of financing options their investment funds offer.
“We can do anything,” he said. “We can do senior debt, subordinated debt, mezzanine loans, we can do equity, we can do construction loans, bridge loans — a whole variety of investment.”