New Markets Tax Credits News Briefs - June 2012

Friday, June 1, 2012

The Community Development Institutions (CDFI) Fund moved to a new office location in May. All correspondence should be mailed to the following address: U.S. Department of the Treasury, CDFI Fund, 1801 L Street NW, 6th Floor, Washington, D.C. 20220. Correspondence sent to the agency's previous address after May 7 will be redirected. The new office space is in a secure federal building that requires visitors to be escorted to the office by CDFI Fund staff. Visitors should expect short security screening delays as part of this process, according to the agency. The relocation will not affect the submission of CDE certification applications, which should continue to be submitted to the Bureau of Public Debt.

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Waveland Community Development (WCD) allocated $11 million in NMTCs to 1000 Dean in Brooklyn, N.Y. The 140,000-square-foot property will be purchased, renovated and leased as part of an effort to create office space that will appeal to start-up companies, designers and artists from the immediate and surrounding neighborhoods. The renovation will also include the addition of a 9,000-square-foot food and beer hall that will feature a number of popular vendors. Goldman Sachs Urban Investment Group and United Fund Advisors also participated in the transaction.

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The Office of the Comptroller of the Currency (OCC) issued supervisory guidance to national banks and federal savings associations to address inquiries on accounting and reporting requirements for troubled debt restructurings (TDRs). OCC Bulletin 2012-10 focuses on factors to consider when evaluating loans for TDR designation and considerations for the appropriateness of accrual status and impairment analysis. It contains no new policy, but rather serves as a reminder of the concepts for evaluating whether a loan modification constitutes a TDR and the corresponding reporting for call report purposes. Read the bulletin at www.occ.treas.gov.

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The California FreshWorks Fund (CFWF), managed by NCB Capital Impact, disbursed $8.5 million in new markets tax credit (NMTC) financing for the development of Northgate Gonzalez Market in San Diego, Calif. Northgate Gonzalez Market is a family-owned supermarket chain that operates 33 stores in southern California. Financing partners included JPMorgan Chase and The California Endowment. This transaction marks the first loan made by CFWF, which has raised $264 million to help bring grocery stores and other forms of healthy food retailers to underserved California communities. The fund is poised to make several grants and affordable loans to fresh food retail projects in the coming months.

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Omaha Habitat for Humanity is using NMTCs to build 14 homes for low-income families in inner-city Omaha, Neb. In its first investment in Nebraska, CEI Capital Management LLC (CCML) provided a nearly $1.9 million qualified low income community investment loan to the development, using a model developed by Smith NMTC Associates LLC to overcome complications associated with financing smaller projects that involve for-sale, single-family housing. The model aggregates qualified active low-income community businesses to deploy loans as small as $500,000 to build a threshold total transaction of at least $5 million. Smith said this model streamlines due diligence and reduces transaction costs. The Habitat for Humanity project created three full-time and two part-time Omaha Habitat affiliate jobs, in addition to 70 construction subcontractor jobs to perform electrical, mechanical and plumbing work on the 14 homes.

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