Target and Cub Foods have open remodeled stores on East Lake Street, but hundreds of small businesses were shuttered in the metro area after riots and arson. (Brian Peterson • brian.peterson@startribune.com/The Minnesota Star Tribune)

In January 2020, Maya Santamaria sold her Odd Fellows building at 2709 E. Lake St. to Adenal Investment of Woodbury for $2.8 million.

In May, the building was destroyed by arson during the riots after the police slaying of George Floyd. Santamaria, who still had businesses inside including the La Raza radio station, decided to move it to Richfield.

Adenal Investment couldn't be reached last week to discuss the future of Odd Fellows. Hennepin County valued the property, before the riots, at $2.1 million for tax purposes.

Allison Sharkey, executive director of the Lake Street Council, said Adenal's principal is trying to figure out how to economically redevelop. That's somewhat the story for dozens of old buildings damaged or destroyed along E. Lake between Nicollet and the Mississippi River.

A couple blocks from the Odd Fellows building, Cub Foods and Target have rebuilt, to the praise of neighbors who appreciate new stores that include merchandise that appeals to increasingly diverse customer bases. Those larger companies had insurance and plenty of capital to finance their welcome redevelopments.

That's in shorter supply when it comes to many other damaged or destroyed buildings.

The city and the Lake Street Council have invested around $15 million to help dozens of owners of damaged buildings and small businesses survive the double whammy of the 2020 pandemic and riots that have derailed up to a quarter of local small businesses, particularly in hospitality and personal services.

A welcome addition arrived last week when LISC Twin Cities, the nonprofit financier that has invested $900 million since 1988 in affordable housing and commercial developments in targeted neighborhoods, announced a $30 million fund to help stabilize areas damaged in the riots.

LISC (Local Initiatives Support Corporation) and funding partners Hennepin County, JPMorgan Chase, Minneapolis Foundation, Bush Foundation and McKnight Foundation have created a Community Asset Transition (CAT) Fund, that will work with local land banks and community organizations to get control of key properties that can be redeveloped over time by local owners who will house surviving and new small businesses.

"We bring capital to people, places and projects who can't get access to sufficient capital through normal channels," said LISC Executive Director Peter McLaughlin, a former Hennepin County Board member.

"In the beginning [following the riots] … what emerged was a real concern about site control. Keeping ownership in the community.

"We had memories of what happened in the wake of the Great Recession of 2008-09. Outside [private equity] and capital from the coast coming in and buying up properties. It was a generational setback in north Minneapolis. Communities want to rebuild in a local, transformational way.

"We started to put together this capital fund to allow for community organizations to start buying these vulnerable properties. A lot of those neighborhoods already were suffering from COVID."

LISC's Kate Speed has a "pipeline" of properties over which negotiations are underway on Lake Street, 38th Street, W. Broadway and University Avenue.

And McLaughlin is working on a second fund that will help with financing gaps between the cost of redevelopment and the maximum loans commercial lenders can make where property values support less.

"It's a top priority of our community to keep local property in local hands and to keep our commercial space affordable to local entrepreneurs," Sharkey said.

"At the same time, it will be complicated to redevelop many of these sites. The CAT fund will help local nonprofits safeguard land. This will buy the community some time to identify and support homegrown entrepreneurs who can infuse these vacant sites with new life."

The Minnesota Department of Commerce reported last winter that private insurance had covered less than half of the $550 million in property damage from the May riots. Many of the buildings are were old and derelict along those urban corridors.

Local government and business organizations are hopeful the Minnesota Legislature will pass what is now a $100 million loan fund for Minneapolis and St. Paul. The DFL-led House started with a $300 million bill.

The Republican-majority Senate went from nothing in February to a $100 million bill, since a Minneapolis Regional Chamber of Commerce-funded study determined Minneapolis has contributed $3.50 in taxes to state coffers for every $1 it gets back for the last 15 years.

"We're proud to team with LISC to preserve local and [diverse] ownership of commercial and residential buildings in these important cultural districts in the Twin Cities," said Dave Rudolph, regional manager of Chase. "Investing … can bring real change and help minority-led small business create sustained growth."