Who's Afraid Of Downtown Malls?

Are decaying inner cities a good investment? Ten of the country's top banks and insurers are betting yes. On Sept. 22, they were set to announce the creation of a novel $24 million equity fund to finance shopping centers--anchored by such big-league supermarkets as Pathmark and Safeway--in 12 to 14 inner cities nationwide. Put together by Local Initiatives Support, a New York group that funnels private-sector money to nonprofit community-based developers, the new initiative expects to generate an annual pretax return of at least 10% for investors that include such heavyweights as J.P Morgan, GE Capital Services, and Bankers Trust. Similar projects in Brooklyn, Newark, and Washington are thriving.

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