Low-Income Housing Tax Credits News Briefs - February 2015

Sunday, February 1, 2015

AFFORDABLE HOUSING INDUSTRY BRIEFS

The United States Conference of Mayors released its annual report, “Hunger and Homelessness Survey: A Status Report on Hunger and Homelessness in America’s Cities” in late December 2014. The survey analyzes the status of hunger and homelessness in 25 cities. City officials were asked to report on the causes and extent of hunger and homelessness in their cities. In addition, they were asked about emergency food assistance and homeless assistance provided between September 2013 and August 2014. The report showed that 48 percent of the cities experienced an increase in homelessness and identified a lack of affordable housing as the leading cause of homelessness among families with children, followed by unemployment, poverty and low-wage jobs. The report is available at www.usmayors.org.

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In late December, CSH, an investor in supportive housing, released the report, “Housing Credit Policies in 2014 that Promote Supportive Housing.” The report describes housing credit agency initiatives that use the low-income housing tax credit (LIHTC) to advance affordable housing development with associated supportive services. The report discusses current housing credit agency allocation policies that foster supportive housing development activity. The report identifies housing credit policy approaches to supportive housing, including threshold requirements, credit set-asides and scoring incentives. The report is available at www.taxcredithousing.com.

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On Dec. 29, 2014, Great Lakes Capital Fund (GLCF) announced the closing of Fund 29, a $22.3 million federal LIHTC equity fund that will go toward financing the rehabilitation and new construction of 134 senior and family affordable housing units in three Indiana communities, Bedford, Beech Grove and Delphi. Stonecutters Place in Bedford will provide 30 apartment units. Development cost is $8 million, with $7.8 million of equity provided by GLCF. Construction is expected to complete in December. Beech Grove Senior in Beech Grove will provide 60 affordable apartments. Development cost is $9 million, with $8.3 million of equity provided by GLCF and units are expected to become available for lease by June, with construction finalized by September. Canal Commons in Delphi will provide 44 apartment homes. Total development cost is $7.3 million, with $6.2 million of equity provided by GLCF. Construction is expected to complete in December.

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The office of the Comptroller of the Currency (OCC) announced changes Dec. 19, 2014, to the annual adjustments to the asset-size thresholds used to define small bank, small savings association, intermediate small bank and intermediate small savings associations under Community Reinvestment Act (CRA) regulations. The changes in definitions of small and intermediate small institutions for CRA examinations are due to the 1.60 percent increase in the Consumer Price Index (CPI) for the period ending November 2014. Small bank or small savings association now means an institution that, as of Dec. 31 of either of the prior two calendar years, had assets of less than $1.221 billion. Intermediate small bank, or intermediate small savings association, means a small institution with assets of at least $305 million as of Dec. 31 of both of the prior two calendar years, and less than $1.221 billion as of Dec. 31 of either of the prior two calendar years. These asset-size threshold adjustments were effective Jan. 1.

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The Office of the Comptroller of the Currency (OCC) released 23 CRA evaluations Dec. 10, 2014. The evaluations are conducted for national banks, federal savings associations and insured branches of foreign banks. Of the 23 evaluations, two rated outstanding, 20 rated satisfactory, and one rated as needs to improve.

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Boston Financial Investment Management LP announced Dec. 4, 2014, the closing of Boston Financial Institutional Tax Credits XLII LP (ITC 42), a $152 million national multi-investor fund. ITC 42 has seven investors and 21 properties spanning 10 states. These states include Washington, Pennsylvania, Rhode Island, Florida, New York, South Carolina, Tennessee, Connecticut, California and Massachusetts. Funds will go toward the construction and rehabilitation of 1,989 units. More than 2,400 temporary and 600 permanent jobs will be created.

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STATE BRIEFS

On Dec. 3, 2014, MaineHousing, the Maine state housing authority, announced $3.4 million in federal low-income housing tax credits (LIHTCs) for the construction or rehabilitation of six affordable housing developments. The properties, which will yield 324 units, are in Augusta, Biddeford, Lewiston, Old Orchard Beach and two properties in Portland. The credits will leverage approximately $30 million in private equity investment, and construction cost for the six properties is expected to total $52.4 million. Hodgkins School, in Augusta, will provide 47 units of senior housing; The Lofts at Saco Falls in Biddeford will provide 80 units for families; Bayside Anchor Apartments in Portland will provide 45 units for families; Pierce Place in Lewiston will provide 62 units for families; The Pines in Old Orchard Beach will provide 60 units for seniors and Bishop Street Apartment in Portland will provide 30 units for persons who are homeless.

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The Northern Marianas Housing Corporation (NMHC) announced Dec. 16, 2014, the approval for the return and reallocation of tax credits issued to Isa Villas and Tasi Homes LLC in order to help the developers meet the timing requirements of the 10 percent test. To meet the requirements of the 10 percent test, a development must exceed 10 percent of the reasonably expected basis in the project as of the end of the second calendar year following the year of allocation. The development must also be placed in service by the end of the second calendar year following the year of allocation. Originally, Tasi Homes received the NMHC board’s approval for allocation of $3.3 million in LIHTCs, with $531,471 of unused tax credits for 2012; $2.59 million in tax credits available for 2013; and a forward commitment of $168,480 of 2014 credits in November 2013. Tasi Homes LLC is building 49 affordable housing units.

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On Nov. 10, 2014, Oregon Gov. John Kitzhaber, along with the Oregon Housing and Community Services, announced a LIHTC award to construct or rehabilitate 14 affordable properties throughout the state. Communities include St. Helens, Medford, Hillsboro, Prineville and LaGrande. Nearly 600 units will be made available to veterans, families in need of a place to recover from addiction, seniors and people with disabilities.

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The Indiana Housing and Community Development Authority (IHCDA) announced Nov. 13, 2014, that 52 applications were submitted, requesting $43.4 million in 2015A-C LIHTCs. The list is available at www.taxcredithousing.com. For HOME funds, six applicants requested $2.4 million. Recommendations for the 2015A-C round will be made Feb. 26.

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DEALMAKERS

WNC, a national investor in real estate and community development initiatives, announced Dec. 4, 2014, the completion of The Villas at Lakewood, a 240-unit affordable housing community in Seattle. WNC provided $9.5 million in low-income housing tax credit (LIHTC) equity for development. The Villas at Lakewood provides 17 two- and three-story buildings with one-, two- and three-bedroom units. Amenities include a clubhouse, swimming pool and spa, two playground areas, an Internet café, a car wash area, a fitness center, a basketball court, storage lockers, picnic areas and an outdoor fitness area. The Villas at Lakewood is available to families earning between 50 and 60 percent of the area median income (AMI).

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On Dec. 17, 2014, Avesta Housing announced the start of construction for Young Street Apartments in South Berwick, Maine. Construction will cost $6 million and will be funded by LIHTCs and other financing through Boston Capital, Maine State Housing Authority, NeighborWorks, Bank of Boston and Bangor Savings Bank. Young Street Apartments will be a three-story, 28-unit senior apartment community. There will be three units designed for people with mobility issues and two units will be for people who have vision or hearing impairments. Young Street Apartments will serve people age 55 and older and households earning 50 percent to 60 percent of the AMI.

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WNC, an investor in real estate and community development initiatives, announced Dec. 11, 2014, the opening of a new 160-unit affordable senior housing building in Honolulu. WNC provided Senior Residence at Iwilei $24 million in LIHTC equity to fund construction of the community. It is a 15-story building with a mixture of one- and two-bedrooms units. The property also includes on-site management, a laundry facility, a community room and an adult day care center. In addition, there is a 12,500-square-foot office space, reserved for nonprofit organizations, on the second floor. Senior Residence at Iwilei is available to residents aged 62 years and older who earn between 50 percent and 60 percent of the AMI.

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The Florida Housing Finance Corporation (FHFC) Dec. 12, 2014, announced $15.8 million for the construction of a residential campus for special-needs residents in West Melbourne, Fla. FHFC awarded $11.8 million in federal LIHTCs, $3 million through a developmental-disability grant and $1 million from a state apartment-incentive loan program. Promise In Brevard, a nonprofit organization, plans to construct three, three-story apartment buildings for 125 special-needs residents and a 13,000-square-foot clubhouse. Promise In Brevard hopes to start various on- and off-campus businesses to employ 80 to 90 percent of its special-needs residents, including a hydroponic garden, a plant nursery, a farmers market, a hair and nail salon, a bed-and-breakfast, a dog park and a café. A groundbreaking ceremony is scheduled for July.

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The Jersey City Housing Authority (JCHA) announced the groundbreaking for Catherine Todd Apartments Dec. 10, 2014. The affordable housing complex will be constructed with $11 million LIHTC equity. The New Jersey Housing and Mortgage Finance Agency allocated $5.6 million in CDBG Hurricane Sandy Funds and issued $9.4 million in bonds for construction and permanent loans for the development. Catherine Todd Apartments will be located at the Montgomery Gardens site, an outdated public housing community. It is the first phase of the revitalization plan for the McGinley Square-Montgomery Street Corridor. Catherine Todd Apartments is a 10-story, high-rise and will provide 68 new, modern apartments for those aged 62 and older who earn less than 60 percent of the AMI. Five of the apartments will be reserved for senior citizens who are homeless. Renovations will total $22.5 million and construction is expected to be complete by April 2016.

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On Dec. 15, 2014, the Community Builders Inc., a nonprofit developer of mixed-income housing, and the Yonkers Municipal Housing Authoritybroke ground on the $27 million second phase of Cottage Place Gardens in Yonkers, N.Y. Phase two will yield 51 affordable rental apartments in a 62,000-square-foot building. This will replace two deteriorated buildings in the complex. Development is expected to generate 100 construction jobs. The first phase was the $63 million Schoolhouse Terrace development that broke ground in 2013 and will be completed by April. The third phase of Cottage Place Gardens will create 72 workforce housing units, which are available to residents earning approximately 30 percent of the AMI.

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On Dec. 9, 2014, the Georgia Department of Community Affairs (DCA) awarded Freedom’s Path $790,000 in annual federal low-income housing tax credits (LIHTCs) for the construction or rehabilitation of new affordable housing units for veterans, senior citizens and working families. Financing also includes $1.9 million in additional state tax credits, $240,000 of land from Augusta Veteran Affairs department, $230,000 in deferred charges from Paxton and a $200,000 planning grant from the Home Depot Foundation. The Augusta Housing Authority also provided Section 8 housing vouchers, while Affordable Housing Solutions contributed $30,000 to provide shuttles for veterans between Freedom’s Path apartments and the hospital. Cost will be $10.5 million. Development plans include transforming two vacant historic buildings on the uptown campus of the Charlie Norwood Veterans Administration Medical Center into 78 one-bedroom apartments. Amenities will include on-site counseling and therapeutic services, job training and education and access to a gym, parks, walking trails, gardening beds and a pavilion area. Units are available to residents earning between 50 and 60 percent of the AMI. Construction is anticipated to begin in August, with a slated completion date of Dec. 31, 2016.

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On Jan. 6, U.S. Bank announced the closing of $8.3 million in loans and tax credit financing for the construction of Voyageur Apartments, a 38-unit, affordable-housing apartment complex for seniors in Great Falls, Mont. U.S. Bank’s Community Lending Division provided a $5.7 million construction and permanent loan and U.S. Bancorp Community Development Corporation (USBCDC), the community development subsidiary of U.S. Bank, invested $6.3 million in equity raised from federal LIHTCs. Voyageur Apartments comprises 24 one-bedroom units and 14 two-bedroom units with access to a clubhouse, a library and community rooms. Residents will receive support services as needed such as Meals on Wheels, transportation and activities at Great Falls Senior Center. Units will be leased to tenants aged 55 and older who earn between 40 percent and 60 percent of the AMI. Construction is expected to be completed 12 months after it begins. The deal closed in partnership with Accessible Space Inc., a nonprofit organization dedicated to providing accessible, affordable, assisted and independent living opportunities to seniors and persons with disabilities.

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The construction of a 47-unit apartment complex in Bozeman, Mont., was announced in late November 2014. Construction costs, which will total $10 million, will be partly covered by $6.6 million in federal tax credits awarded by the Montana Board of Housing. The $6.6 million in federal tax credits will be broken down into an annual award of $659,000 over the course of 10 years. There will be 30 two-bedroom units and 17 three-bedroom units. Construction is expected to start in the spring, with an anticipated move-in date of early September.

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The Georgia Department of Community Affairs announced Nov. 19, 2014, the award of $22.4 million in federal LIHTCs for the new construction or rehabilitation of 30 affordable rental housing properties. A total of 2,292 units will be available to working families, seniors and persons with disabilities. There were 57 applications for the 2014 LIHTC awards.

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PEOPLE IN THE INDUSTRY

David Reznick, the co-founder and chairman of the board of the Reznick Group and a pioneer in the affordable housing community, died Dec. 31, 2014, at his home in Washington, D.C. He was 77. Reznick co-founded Reznick, Fedder & Silverman in 1977 and saw it grow into a top-20 accounting firm before merging with J.H. Cohn in 2012 to form New York-based CohnReznick LLP. Reznick worked with the Department of Housing and Urban Development (HUD) on cost certification compliance as early as 1968, testified before Congress and gave counsel to developers, syndicators and lending institutions throughout his career. Reznick won numerous awards and honors during his career and was the founding member of the Jewish Foundation for Group Homes. He was also involved in fundraising for the research and treatment of breast cancer, children’s cancer, muscular dystrophy, leukemia and lymphoma. He is survived by his wife, Sandra, and their children Steven (and Lydia), Jodie (and Phil), Mitchell (and Diana) and Laura (and Alex), as well as nine grandchildren. His funeral was Jan. 4 at Temple Beth Ami Synagogue in Rockville, Md.

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Red Capital Group LLC announced Dec. 18. 2014, that Tracy Peters was named head of affordable housing for the financing firm. Peters has been with the firm for more than 20 years, having originally joined the predecessor entity of Red Capital Group in 1993 as a specialist in structuring bond underwriting and placement issues. Before that, he was an auditor at Ernst & Young. Peters was also recently named vice president on the Ohio Housing Council Board of Trustees. He received a degree in finance and accounting from Miami University and is a nonpracticing certified public accountant.

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The Housing Partnership Network (HPN) announced Dec. 17, 2014, that Paul Weech will become the next president and chief executive officer of NeighborWorks America. Weech was previously the executive vice president for policy and external affairs at HPN. Before that, he worked for the Stewards of Affordable Housing for the Future. He also held leadership roles within the U.S. Small Business Administration, Fannie Mae and the U.S. Senate Committee on Banking, Housing and Urban Affairs. Weech serves on the board of the National Low Income Housing Coalition and the National Housing Conference. He received a master of public policy degree from the Ford School for Public Policy Studies at the University of Michigan.

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Great Lakes Capital Fund (GLCF) announced Dec. 18, 2014, the promotion of Fred Hash to senior vice president of business development. His responsibilities will include working closely with GLCF’s capital raising division. Hash has been with GLCF for 15 years, previously serving as the vice president/director of business development. Before joining GLCF, Hash was president of Indiana Capital Fund for Housing (ICFH), before ICFH merged with Michigan Capital Fund for Housing to form Great Lakes Capital Fund. Before joining ICFH and GLCF, Hash served as the community investment officer at the Federal Home Loan Bank of Indianapolis.