Neighborhood Restaurant Initiative
The Neighborhood Restaurant Initiative is part of the Office of Business Development's ongoing efforts to support the revitalization of the city's commercial districts. This is the fifth year of an initiative that is designed to provide more neighborhood retail services and create jobs, thus expanding opportunities for entrepreneurs and residents. The initiative provides a menu of resources ranging from business instruction to assistance with licensing and permitting, to marketing and design, and also includes a financing option.
The primary focus is creating new sit-down, family-style restaurants owned and operated by local entrepreneurs. Existing restaurants (expansion project) and locally owned franchises are also eligible. Financing will be considered only for those projects that create ten or more jobs, with a $100,000 maximum loan amount. Eligible projects can receive assistance in the form of:
Permitting and licensing (ISD)
Design Assistance: signage, logos, storefronts
Façade improvement grants
Liaison to other City departments
Financing (secured loan)
Financing: The City's loan can be in a junior position. Senior debt must be from a bank or other institutional-type lenders. Flexible terms will be negotiated on an individual basis, with up to a ten-year repayment schedule at a market interest rate. The maximum loan amount per business is $100,000.
Equity requirement: Projects must demonstrate that at least 20% of project costs will be paid for with equity that is in a junior position to the city's loan. Equity can be invested by either the owner/developer or by other outside investors.
Project costs will be reviewed by OBD staff to determine that they are reasonable and consistent with third-party, fair market prices in the current economy and the restaurant industry.
Each project approved for financing through this initiative will be required to sign an Employment Initiative Agreement with the City of Boston. This will require that the project meet the federal government's (HUD) job creation requirements and the requirements of the Boston Resident's Jobs Policy (BRJP). HUD requires that at least one job is created for each $35,000 of assistance, or $50,000 if the project is in the empowerment zone. 51% of the jobs must be made available to low-to-moderate income individuals. The BRJP states that projects must make best faith efforts to hire at least 50% Boston residents, 10% minorities, and 5% women.
Please call Keith Hunt at 617-635-0355.