Twelve Wichita banks have committed $8 million in private funds to a joint loan program for qualifying downtown Wichita projects.
Member banks are: Bank of Kansas, Emprise Bank, Intrust Bank, Simmons First National Bank, Commerce Bank, Equity Bank, Kanza Bank, Southwest National Bank, Community Bank, Fidelity Bank, Legacy Bank and Sunflower Bank.
The program will be publicly unveiled at a news conference this morning.
Projects must already have a primary lender and project equity before applying to the consortium. Projects will be routed through the Wichita Downtown Development Corp.' s design resource center at 507 E. Douglas.
"This is a perfect example of people putting money where their mouths are," Wichita Mayor Carl Brewer said. "These are bankers who believe in what we're doing. They see the positive direction we're going.
"Plus, this group takes the guesswork out of who's willing to finance what. These guys are experts. They can analyze whether they have a good or a bad project."
WDDC president Jeff Fluhr agreed with Brewer.
"It's a statement how important downtown is to our future," Fluhr said, "and a statement how competitive downtown can be."
WDDC chairman Dick Honeyman, a Wichita attorney, said the consortium has the potential to jump-start development downtown.
"I see it as a huge endorsement of the master plan and the future of Wichita, especially downtown," Honeyman said. "It's hard to overemphasize how important a step this is."
The consortium is loosely modeled after a similar bank group in Louisville, Ky., and is not directly tied to the city's project review process, which determines eligibility for publicly funded infrastructure.
As loans are repaid, those funds will be put back into the consortium to fund additional projects.
The group also is similar to loan consortiums in Wichita that financed the Hyatt Regency and the State Office Building downtown.
The consortium is a "last stop" loan committee for developers to obtain gap or interim financing for their projects, said Gary Schmitt, who oversees commercial lending for Intrust Bank and helped put the consortium together.
It doesn't preclude action by any of the consortium banks that might want to take a potential project "off the table and take it back to our bank, or go together as two or three of us," Schmitt said.
"The banks are very supportive of downtown Wichita. They're very interested in the core of our community. The loan consortium just removes one more hurdle... but we'd rather do it privately through our banks than run it through the consortium."
The consortium will be "a tremendous asset in talking to prospects and marketing properties in the downtown area," said Wichita commercial broker Steve Martens, who includes Union Station among the downtown property he's brokering.
"Money's always an issue in development, but beyond the consortium's initial amount, this shows the majority of our lenders in the greater Wichita market are invested in downtown. It sends a very strong and positive signal to the development community."