Low-Income Housing Tax Credits News Briefs - June 2012

Friday, June 1, 2012

AFFORDABLE HOUSING INDUSTRY BRIEFS

On May 3, the Internal Revenue Service (IRS) published final regulations regarding low-income housing tax credit (LIHTC) qualified contract rules. The final regulations provide guidance concerning LIHTC property owners' requests to LIHTC agencies to obtain a qualified contract for the acquisition of an LIHTC building. The rules will affect owners requesting a qualified contract, potential buyers and agencies responsible for the administration of the LIHTC program. A copy of the final qualified contract regulations and additional information on qualified contracts and related issues can be found at www.taxcredithousing.com.

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The Office of the Comptroller of the Currency (OCC) released a list of Community Reinvestment Act (CRA) performance evaluations that became public during the period of March 15 through April 14. Of the 28 evaluations, four were rated outstanding, 19 were rated satisfactory, five were rated needs to improve, and none received a substantial noncompliance rating. View the evaluations at www.occ.gov.

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Freddie Mac announced its highest-producing multifamily mortgage sellers of 2011. The lenders who transacted the most financing volume with Freddie Mac and their corresponding 2011 loan volume amounts are: CBRE Capital Markets, $4.13 billion; NorthMarq Capital LLC, $2.14 billion; Berkadia Commercial Mortgage LLC, $1.68 billion; Wells Fargo Multifamily Capital, $1.49 billion; Holliday Fenoglio Fowler LP, $1.43 billion; and CWCapital LLC, $1.41 billion. Through these and other lenders, the company purchased more than $20 billion in loans last year, comprising 321,000 rental units and resulting in approximately $14 billion in mortgage securitizations. See the complete list of top multifamily lenders at www.freddiemac.com.

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The U.S. Department of Housing and Urban Development (HUD) announced changes to certain multifamily housing and healthcare facility mortgage insurance premiums (MIPs) for commitments to be issued or reissued in fiscal year 2013. The MIP for market-rate New Construction/Substantial Rehabilitation loans under Sections 207, 213, 220, 221(d)(4), 231, 232 and 242 is proposed to increase by 20 basis points. The increase will not apply to LIHTC loans, other affordable housing loans for HUD-assisted properties, or loans insured under FHA's Risk Sharing programs. See the notice in the April 10 Federal Register for more details.

DEALMAKERS

The National Development Council (NDC) launched its 10th LIHTC fund, NDC Corporate Equity Fund X LP, an offering dedicated to raising funds for affordable housing. The $100 million initiative will allow NDC to continue its efforts to create affordable housing in both rural and urban communities.

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In its first affordable housing tax credit investment in the Southeast, U.S. Bank provided nearly $9 million of permanent funding to support the construction of Arcadia Park Apartments in Columbia, S.C. Developed by Carlisle Development Group, the 60-unit complex will be located in the city's northern suburbs and will offer one-, two- and three-bedroom units to residents earning 50 and 60 percent of area median income (AMI). The development will also include an outdoor gazebo, a playground, and a community building with a computer room, exercise room and laundry facilities. Arcadia Park is scheduled to open in early 2013.

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UnitedHealthcare provided $8.1 million in LIHTC equity to Myers Place, a $13.2 million mixed-use supportive housing community in Mount Prospect, Ill. Development partners and local residents in May broke ground on the property, which will feature 18 studio and 21 one-bedroom furnished apartments, a supportive services program for residents and 3,560 square feet of commercial space. Myers Place will also offer a community room with a kitchen, laundry facilities, and office space for case managers. UnitedHealthcare made its equity investment through a partnership with Enterprise Community Investment. Additional major funding partners include the Illinois Housing Development Authority and Village Bank & Trust. Myers Place is expected to open in summer 2013.

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Boston Capital provided LIHTC equity to support the construction of Poets Landing Apartments, a 72-unit multifamily development in Dryden, N.Y. Located on an 18-acre site, the community will feature 24 one-bedroom, 32 two-bedroom, and 16 three-bedroom units in nine two-story buildings. It will also offer a playground and a community room with a kitchen, fitness center, computer room and central laundry. Units will be available to families earning 60 percent or less of AMI and will feature central air, dishwashers, patios or balconies, and storage.

STATE BRIEFS

Pennsylvania Housing Finance Agency's (PHFA's) board approved $11.8 million in agency funding and $28.5 million in low-income housing tax credits (LIHTCs) for the construction of 32 affordable multifamily housing developments throughout the state. When completed, the new properties will provide 1,579 housing units. The list of recipients is available at www.phfa.org.

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The Ohio Housing Finance Agency (OHFA) awarded more than $29 million in LIHTCs to 37 developments. OHFA selected the 2012 recipients out of 102 applicants seeking more than $80 million in tax credits, which exceeded the total amount of available credits by $56 million. A list of applicants receiving a 2012 LIHTC reservation is available at www.ohiohome.org.

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The Wisconsin Housing and Economic Development Authority (WHEDA) announced the award of $12.6 million in LIHTCs to fund 21 affordable developments in Wisconsin. The tax credit awards are projected to create 1,816 jobs and 1,292 housing units. WHEDA received 74 applications representing approximately $49 million in LIHTC requests. See a listing of WHEDA's 2012 tax credit awardees at www.wheda.com.

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Eric Chatman was named president and executive director of the Connecticut Housing Finance Authority (CHFA), taking over from interim president and executive director Susan Whetstone. Most recently, Chatman served as deputy director and chief financial officer for the Iowa Finance Authority, where he oversaw housing and economic development initiatives. His career has also included stints as treasurer of the Federal Home Loan Bank of Des Moines, chief finance officer of a telecommunications company in Virginia, and a division manager in the Treasury Department of the African Development Bank in West Africa. Chatman holds a bachelor's degree in economics from Tufts University, a master's degree in international affairs from George Washington University, and a master's in business administration from the University of Chicago.

PEOPLE IN THE INDUSTRY

Centerline Capital Group selected Michael P. Larsen as its new chief financial officer (CFO). Robert Levy will step down as CFO and remain as president and chief operating officer. Larsen most recently worked as Centerline's treasurer and director of corporate finance, responsible for cash management operations, debt management and raising corporate capital. As CFO, his role will expand to include all treasury, corporate finance, accounting, tax and risk functions. Larsen earned a master's in business administration from Columbia University and a bachelor's degree from the University of Pennsylvania.

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Maurice Jones was sworn in as deputy secretary of the U.S. Department of Housing and Urban Development (HUD). As HUD's second most senior official, Jones is charged with managing the department's day-to-day operations, a nearly $47 billion operating budget, and HUD's 8,700 employees. He most recently worked as president of Pilot Media, the largest print and digital organization in Hampton Roads, Va. Jones also served as commissioner of the Virginia Department of Social Services and deputy chief of staff to then-Gov. Mark Warner. At the U.S. Treasury Department, Jones was special assistant to the general counsel and also served as legal counsel to the Community Development Financial Institutions Fund, becoming its director during the Clinton administration. He graduated from Hampden-Sydney College, attended Oxford University on a Rhodes Scholarship and earned a law degree from the University of Virginia.

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Paul Nash was named senior deputy comptroller and chief of staff at the Office of the Comptroller of the Currency (OCC). He will succeed John Walsh, who is retiring this summer. Nash previously served as deputy to the chairman for external affairs at the Federal Deposit Insurance Corporation, where he oversaw the agency's Office of Legislative Affairs, the Office of the Ombudsman, and the Office of Minority and Women Inclusion. He received a law degree from Georgetown University Law Center and bachelor's degrees from the University of Pennsylvania.

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Colorado Housing and Finance Authority (CHFA) announced that James Hahn of JMH Consulting LLC will serve as chairman of the authority's board of directors for the 2012-2013 term. Hahn was initially appointed to the board in 2009 and in February 2012 he was appointed chair of CHFA's finance committee. He brings more than 25 years of experience in investment banking, real estate finance, and portfolio management. Hahn's firm provides transaction and asset management services to real estate developers, and he is familiar with the intricacies of tax-exempt bonds and the federal LIHTC program. Hahn has been a board member of several community and national organizations, including the National Housing and Rehabilitation Association and the Housing Authority of the city and county of Denver.

BONDS

The AFL-CIO Housing Investment Trust (HIT) purchased $6.6 million in tax-exempt bonds to preserve affordability and carry out a major rehabilitation of the Holy Infant and the St. Joseph Apartments, two developments for low-income seniors in Shrewsbury, Mo. The buildings are owned and occupied by Cardinal Ritter Senior Services. Construction on the $13 million project is expected to create 75 union jobs. Refinancing the existing debt for the two properties, which were built under the Section 202 program, will keep their 157 housing units affordable for an additional 20 years. Most of the efficiency units will be converted to one-bedroom units, and the kitchens and bathrooms will be renovated to improve accessibility. Residents are at least 62 years old and have household incomes at or below 50 percent of the area median income. The bonds were secured by Lancaster Pollard, issued by the St. Louis County Industrial Development Authority and insured by Ginnie Mae securities.