CLEVELAND, Ohio – City council will consider giving a $12 million loan to the nuCLEus project. The money would bring the developer one step closer to shoring up financing for the ambitious, $350 million plan that would add two towers to downtown’s skyline.

Legislation laying out the proposed financing package was introduced to city council at its Monday night meeting. The proposal is for a $12 million loan, with a condition that developer Stark Enterprises pay back 110 percent of the original amount using new income-tax and parking revenue generated by the project. The length of the loan term was not specified.

The legislation will spend a few weeks going through city council’s committee process before coming back to the full council for a vote.

First introduced in 2014 as a $500 million project to build a 54-story skyscraper in downtown’s Gateway District, Stark now seeks to build a pair of 24-story towers, one featuring about 400,000 square feet of office space and the other featuring approximately 250 residential units. The city loan would help pay for construction of the office tower, according to the mayor’s office.

The development is also slated to include about 80,000 square feet of retail on the ground floor, a pedestrian laneway between the two buildings, and a six-floor parking garage. Stark has secured Benesch Law, currently headquartered at 200 Public Square, as its anchor office tenant and plans to move its own office to nuCLEus.

The development, located at the corner of East Fourth Street and Prospect Avenue, would replace a large parking lot that sits just north of the newly renamed Rocket Mortgage FieldHouse.

“The nuCLEus project is an opportunity to reutilize the Gateway lots and to bring critical opportunities for employment, housing and economic growth to the city,” Mayor Frank Jackson said in a news release. “This project not only complements previous development in the Huron area, but also demonstrates an ongoing commitment to the revitalization of our city’s neighborhoods.”

“After years of plans and anticipation, I’m pleased that this is moving forward,” City Council President Kevin Kelley said. “I look forward to learning more about this potentially transformational Gateway District project that could weave the district and downtown more fully.”

In an interview with The Plain Dealer, 3rd Ward Councilman Kerry McCormack, who sponsored the legislation and represents parts of downtown, said he is comfortable with the legislation because the city would get back at least 110 percent of the original loan amount.

“The city will retain all of the existing tax revenues from the current income and parking tax being generated by Stark and Benesch, and then on top of that, we will be paid back the 110 percent of the new revenue to pay down the debt service,” he explained. “I view it as an investment. We’re guaranteed that money.”

NuCLEus is a “catalytic” development and will help make the Gateway District more walkable and connected, said McCormack.

The city previously approved a non-school tax increment financing deal for the project, and two Vacant Property Initiative loans totaling $360,000. Tax increment financing allows revenue created by a development to help finance the project.

As for the rest of the project’s financing, a financial consultant working on nuCLEus said this loan, along with anticipated subsidies from Cuyahoga County and the state, will close the last funding holes.

“We’re very close to wrapping up support from the state of Ohio and Cuyahoga County. These three incentives are the last pieces to close a financing gap and allow us to proceed with a groundbreaking,” said Ryan Sommers, managing director of financial services at Project Management Consultants.

In addition to the public subsidies, the project’s capital stack includes a “significant equity contribution by Stark and its partners, and most likely a consortium of banks to provide the senior construction debt,” Sommers said.

A document from the city’s economic development department, posted on the city’s website along with the ordinance, provides an estimated breakdown of the project’s funding sources. It lists the county and state’s expected contributions at $6 million each.

The project also may take advantage of the federal Opportunity Zones program, which provides tax incentives to investors who put capital gains into certain economically distressed areas, Sommers said. Downtown Cleveland is one of the eligible areas.