The redevelopment project involves a bevy of real estate finance and development interests that view the project as a potential catalyst for making the Livernois Avenue of Fashion the next hot spot in the city for revitalization.

"This is an incredibly important development getting this project off the ground," said Peter Scher, head of corporate responsibility for JPMorgan Chase & Co., which has about $3 million in financing tied to the project.

Financing officials involved in the project acknowledged it wouldn't be possible to do without a $1.3 million performance-based grant from the Michigan Economic Development Corp. — a reflection that spurring targeted revitalization of even a stable corridor like the north end of Livernois Avenue in Detroit requires government subsidy.

"This is an all-in project for us," said Greg Tedder, executive vice president and chief community development & marketing officer for the MEDC. "We would consider it an anchor investment in the corridor."

The MEDC has a $1.5 million limit for an individual grant from its $60 million annual community development fund, Tedder said. "That's our motivation to get this done," he said.

"We only ever want to be involved in projects that otherwise won't happen if it weren't for public support."

Without the MEDC's subsidy, the cost of remediating environmental contamination in the buildings, razing two single-story storefronts and construction for the project would not have been financially feasible, said Nicholas Pohl, originations loan officer at Capital Impact Partners.

"If we had $200,000 less from the MEDC, it would not be feasible," Pohl said. "It was that close to not getting done."

Capital Impact Partners, a community development financial institution (CDFI), has $4.7 million in loans tied up in the project, $2.875 million of which is sourced from the JPMorgan Chase-funded Detroit Neighborhoods Fund. The New York banking giant has committed $150 million in investments in neighborhood stabilization and economic development in Detroit.

Invest Detroit, another CDFI affiliated with Business Leaders for Michigan, loaned Hessler $1.5 million for the project.

"It wasn't an easy one to put together, that's for sure," said Marcia Ventura, senior vice president at Invest Detroit.

It wasn't easy, in part, because Hessler didn't want to construct a three- or four-story mixed-use building that would seem out of character with the mostly one-story shopping district along Livernois, which is surrounded by the middle-to-upper-class neighborhoods of Bagley, Sherwood Forest, University District and Palmer Woods.

"Livernois has some of the few unbroken city blocks of retail that are left in the city," said Hessler, who lives a few blocks away in Sherwood Forest. "We've got a population with expendable income here. We've got all of the assets that we need."

The introduction of residential units in the second floor is key to establishing a more vibrant corridor, Ventura said.

Six of the units will be 1,100 square feet with two bedrooms and one bathroom; one will be an 800-square-foot one bedroom, one bathroom; and three will be 600 square feet studios with one bathroom.

"That's one of the things that really helps bring an area back to vitality, by getting more residential," she said. "The easiest way to get residents walking is to have them live above your shops."

Construction of the Liv.7 project is expected to take 14 months to complete. Eastpointe-based The Monahan Co. is the general contractor and has committed $200,000 in equity toward the project, Pohl said.

Quinn Evans Architects, which has offices in Detroit and Ann Arbor; PM Environmental, which has an office in Berkley; and financial consultant David Howell of Midtown Inc. are also working with Hessler on the project.

The Detroit Brownfield Redevelopment Authority approved $1.2 million in tax increment financing for removal of underground storage tanks that needed to be cleared out to make room for parking in the basement garage, said Brian Vosburg, brownfield redevelopment manager for the Detroit Economic Growth Corp.

The underground parking spaces were a key factor in Hessler's ability to secure financing because, aside from a couple of private lots, parking is limited to streetside along Livernois, Vosburg said.

"A lot of banks were skittish about lending without parking at the project," Vosburg said. "It could very well be a model for future projects in the corridor."