The city has agreed to provide assistance to a developer investing $1.5 million to rehabilitate the former Lederman Bail Bonds building in downtown Newton. Council members voted unanimously to provide a forgivable loan of $75,000 and tax refunds not to exceed $85,000 over the next 10 years.
Located in the 100 block of North Second Avenue East, the building has been identified by the city as one of the most significant properties in the downtown historic district in dire need of rehabilitation. Ex Nihilo, LLC entered into a purchase agreement for the building but requested assistance from the city.
Newton is ready to help with the redevelopment project, which will still preserve the historic nature of the property. According to city documents, the building is in an urban renewal zone, which allows the city to participate in a mechanism and encourage high-level rehabilitation.
Ex Nihilo is owned by Jerry Schwaller, who is a native of Jasper County, maintains a part-time office at Northwestern Mutual in Newton as well as another office in the metro. Schwaller is investing $1.5 million in the rehabilitation and has agreed to a minimum valuation of $475,000.
Currently, the building is valued at $119,870.
Newton’s Director of Community Development, Erin Chambers, said the building would have one of the highest assessments downtown. The property sat unoccupied for several years, longer than Chambers even worked for the town of Newton. Chambers has worked for the city for almost 17 years.
“It’s clearly one of the largest buildings – it’s a double-fronted building – in downtown Newton that has yet to see rehabilitation,” Chambers said. “We’ve had a lot of success in the square and downtown over the past few years. It is one of the last remaining.
There will be no second floor accommodation included in the redeveloped building. The developer intends to transform the building into commercial space. By upgrading buildings and increasing assessments, Chambers said it relieves tax pressure across the city and ensures properties carry their fair share.
Newton City Administrator Matt Muckler said the building had seen better days and needed a lot of improvements.
“It’s a massive development,” Muckler said, noting that the developer would come back to talk to the board. “…This is a major new 3,000 square foot retail space. This was, as Erin mentioned, one of those big projects that the staff focused on, working to get someone to believe in this building and make it a success.
Contact Christopher Braunschweig at 641-792-3121 ext. 560 or [email protected]