AFFORDABLE HOUSING INDUSTRY BRIEFS

Estimates from American Community Survey (ACS) data published in December show that people living in poverty tend to be clustered in certain neighborhoods rather than evenly distributed across geographic areas. The ACS, which includes socioeconomic data on every community in the nation for the combined years from 2006 to 2010, found that 23 percent of the nation's population live in census tracts with poverty rates of 20 percent or higher. Among states, the percentage ranged from 46 percent in Mississippi to 5 percent in New Hampshire. The ACS also covers topics including educational attainment, income, occupation, commuting to work, nativity, ancestry and monthly housing costs. Estimates for each neighborhood can be accessed through the American FactFinder database at http://factfinder2.census.gov.

The National Council of State Housing Finance Agencies (NCSHA) was one of several organizations that wrote President Obama and U.S. Department of Agriculture (USDA) Secretary Tom Vilsack to urge them to propose fiscal year (FY) 2013 funding levels for USDA rural housing programs at their FY 2011 appropriated levels or higher. The groups expressed their strong concern over the Administration's proposed cuts to rural housing programs in FY 2012. Specifically, the letter requests that the Administration propose funding for the Section 515 rural rental housing program equal to the amount proposed in FY 2012 and include enough funding to develop new units. It highlights the Multifamily Preservation and Revitalization program and the Preservation Revolving Loan Fund as vital to the preservation of Section 515 units. A copy of the letter is available at www.ncsha.org.

The Internal Revenue Service (IRS) published a notice of proposed rulemaking regarding the definition of an "interest in a limited partnership as a limited partner" for purposes of determining whether a taxpayer materially participates in an activity under Section 469 of the Internal Revenue Code. The proposed regulations affect individuals who are partners in partnerships. Comments and requests for a public hearing must be received by February 27. See the November 28 Federal Register notice for more details.

DEALMAKERS

Boston Capital provided low-income housing tax credit (LIHTC) equity to construct Marley Meadows, a 36-unit affordable development in Glen Burnie, Md. Located on two acres, the property will feature 10 one-bedroom, 17 two-bedroom and nine three-bedroom units spread throughout three buildings. Units will be available to households earning 60 percent or less of the area median income (AMI) and will include dishwashers, walk-in closets, central air conditioning, and energy efficient appliances and fixtures. Residents will also have access to a 600-square-foot community room, covered parking, a computer lab and a playground. Marley Meadows' construction will create an estimated 55 jobs.

UnitedHealth Group announced that it has partnered with Enterprise Community Investment to provide as much as $50 million to finance affordable housing developments in targeted communities. Called the UnitedHealth Group Affordable Housing Investment Program, the partnership will invest in developments that qualify for federal LIHTC or historic tax credits, with a focus on serving low-income families, households with special needs and the growing elderly population. The first three properties being funded through the program, all of which located in New Mexico, are Stage Coach Apartments in Santa Fe, Mountain View Apartments in Deming, and Robledo Ridge Apartments in Las Cruces. The three developments represent a $22 million investment in the state, the creation of 300 jobs and the addition of 180 affordable housing units.

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The Richman Group Affordable Housing Corporation closed a $257 million multi-investor fund, U.S.A. Institutional Tax Credit Fund LXXXVII LP (Fund 87). Fund 87 will include a portfolio of 32 properties located in 13 states. Ten institutional investors representing insurance and banking institutions contributed the fund's equity. The properties acquired by Fund 87 will provide affordable housing for family, senior and special needs tenants and will add 2,241 units to Richman's portfolio.

STATE BRIEFS

The Texas Department of Housing and Community Affairs (TDHCA) released a draft of the 2012 State of Texas Low Income Housing Plan and Annual Report (SLIHP). The document serves as a comprehensive reference on statewide housing needs, housing resources and strategies for funding allocations. It also reviews TDHCA's program, current and future policies, and reports on 2011 performance. Written comments on the SLIHP draft must be submitted to TDHCA before February 9 for consideration. A copy of the draft is available online at www.tdhca.state.tx.us.

The Maryland Department of Housing and Community Development (DHCD) awarded more than $9.3 million in rental housing funds (RHF) and low-income housing tax credits (LIHTCs). Developers of three properties received a total of $6 million in RHF and $3.4 million in annual LIHTC for the construction or rehabilitation of 273 rental units, including 41 units that will be set aside for persons with disabilities. The development include the renovation of Tanglewood/Sligo Hills, an apartment complex in Silver Spring; the construction of New East Crossing, a family housing development in North East; and the second phase of Barclay Square, a comprehensive redevelopment of the Barclay neighborhood in Baltimore City. According to DHCD, the developments' expenditures will amount to $73.6 million. During the construction period they will create 342 full-time jobs and generate approximately $916,000 in state and local tax receipts. The department will hold its next competitive funding round in the fall. More information on the awards is available at www.mdhousing.org.

California landlords are legally permitted to ban smoking in multifamily buildings under a state law that took effect last month, The Sacramento Bee reported. Gov. Jerry Brown signed the measure, S.B. 332, into law in September. The law requires landlords to designate in the lease agreement the areas where smoking is not allowed. Multifamily units account for more than 30 percent of California's housing, according to San Fernando Valley Sen. Alex Padilla.

PEOPLE IN THE INDUSTRY

Ronne Thielen has joined R4 Capital Inc. as an executive vice president to head the firm's Santa Ana, Calif. office. Thielen is the chairman of the Affordable Housing Tax Credit Coalition and frequently promotes the low-income housing tax credit (LIHTC) program to members of Congress on behalf of the industry. Thielen most recently served as managing director of Centerline Capital Group, where she established and ran its West Coast operations.

Aaron Gornstein was named Undersecretary of the Massachusetts Department of Housing and Community Development. Since 1990, Gornstein has served as the executive director of Citizens' Housing and Planning Association (CHAPA), a not-for-profit affordable housing and community development advocacy group. Before joining CHAPA, he was associate planner for the city of Cambridge, Mass. and a housing services coordinator for Tri-City Community Action Program in Malden, Mass. Gornstein holds a bachelor's degree from the University of Wisconsin and a master's degree in urban and environmental policy from Tufts.

Centerline Capital Group announced that Jonathan Price has joined the firm as assistant vice president in the mortgage banking division. He will assist the head of the alternative capital group, Kevin Smith, in analyzing and sourcing debt and equity for a variety of asset classes. Prior to joining Centerline, Price worked in corporate real estate for Kaiser Permanente, where he managed 59 buildings in the Mid-Atlantic region. He received a bachelor's degree from Washington & Lee University and is pursuing a master's degree in real estate finance from Georgetown University.

BONDS

The IRS issued Notice 2012-3 to provide guidance on current refunding issues that are used to refund original tax-exempt bonds under certain disaster relief programs. The notice applies to qualified bonds under the Gulf Opportunity Zone, Midwest Disaster Area and Hurricane Ike Disaster Area programs. The IRS said that a current refunding issue that meets all requirements outlined in the notice may be issued after the specified deadline for the issuance of the original qualified bonds and be treated as an issue of qualified bonds. Read the notice online at www.taxcredithousing.com.

The Ohio Housing Finance Agency (OHFA) Board authorized the issuance of as much as $8.5 million in multifamily bonds for two affordable housing developments. Alston Park, an affordable family development in Avondale, received $4.5 million; The Lofts at Court and Main, an adaptive reuse of the former Shriners Temple building as affordable family housing in Washington Court House, received $4 million. More information about the properties is available at www.ohiohome.org.

Red Capital provided bond underwriting and mortgage banking services as part of a $33.2 million transaction to rehabilitate Woolf House, an affordable senior housing development in San Francisco, Calif. The community is a 182-unit high rise containing studio and one-bedroom units for seniors who earn 50 percent or less of the area median income. Red Capital Markets underwrote $16.7 million in Series 2011-B tax-exempt bonds to bridge the receipt of 4 percent LIHTC equity proceeds, which Bank of America will provide. The financing structure also included $16.5 million of New Issue Bond Program proceeds, which were released from escrow upon the issuance of the Series 2011-B bonds. Renovations are expected to be complete by July 2013.

CORRECTION

A brief in the January issue of the Journal of Tax Credits misidentified the bank with which the Iowa Finance Authority is partnering to provide multifamily housing bond financing. It should have listed the Federal Home Loan Bank of Des Moines. We regret the error.

 

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