It’s easy to underestimate the power of creativity. But in St. Louis, an innovative approach to funding important construction projects — one that relies on the use of union pension funds — has helped to bring new developments and jobs to this Midwest city.
The latest example is the $42 million Cortona at Forest Park Apartments, a five-story 280-unit multi-family complex that includes what developers refer to as a Euro resort. This resort area includes a 7,000-square-foot clubhouse, multi-level saltwater swimming pool, outdoor kitchen, outdoor pavilion with a fire ring and multiple lounging areas and cabanas.
While the Cortona, which had its ground-breaking ceremony Oct. 9, is unique in its own right, what’s also intriguing is the team approach that the forces behind the project took to developing and funding it.
Developer Balke Brown Transwestern; Washington, D.C.-based AFL-CIO Building Investment Trust; the St. Louis Building and Construction Trades Council, AFL-CIO; and PRIDE Labor/Management all worked together to make the project a reality. the AFL-CIO Building Investment Trust is providing equity capital for the project, putting union pension funds back into the community to fund the building of the Cortona.
At the same time, these pension funds, once they’re put back into building projects, are providing hundreds of union construction jobs. During the last 20 years, real estate funds sponsored by the AFL-CIO have invested more than $500 million in union pension dollars to launch construction projects in the St. Louis area.
“This approach has paid off in St. Louis. It’s help to rebuild Missouri,” said Jim LaMantia, executive director of PRIDE Labor/Management, a St. Louis-based labor management organization founded 40 years ago with the goal of maintaining harmony and cooperation among the key players in the St. Louis building industry. “The unions are investing in St. Louis, something that puts people to work. It’s been a strong relationship, and all it’s doing is getting stronger.”
The Cortona will rise on a 5-acre site at The Highlands mixed-use development located across the street from Forest Park, a large public park in the western portion of St. Louis. The Cortona will be a gated community, with 70 percent of its units of the one-bedroom variety and 30 percent two-bedroom.
And while the Cortona will certainly provide an economic boost to the city of St. Louis, the partners behind the project aren’t resting yet. Jeff Aboussie, executive secretary and treasurer with the St. Louis Building and Construction Trades Council, AFL-CIO, said that his group and others are always looking for more ways to use union pension fund dollars to bring more developments, and jobs, to the region.
“We have been reaching out to businesses and working quietly behind the scenes to advance economic prosperity for all in our region,” said Aboussie in a written statement. “We aren’t waiting for credit markets to come back, but are actively partnering with civic and business leaders who share our vision of selling St. Louis as a great place to live, build and grow a business.”
The AFL-CIO Building Investment Trust is an open-end core commercial real estate fund with $3 billion in gross assets of as June 30. Since its beginnings in 1988, the trust has invested more than $4 billion for the development and acquisition of more than 160 office, retail, multi-family, hotel, warehouse and mixed-use properties across the country. PNC Bank manages the fund.
“The Cortona really is a crown jewel project,” LaMantia said. “It is in a truly desirable location. They’ve done a tremendous job in developing it.”