SB 1275 By Taylor, Van. Relating to the appraisal for ad valorem tax purposes of certain nonexempt property used for low-income or moderate-income housing. – Pending
(11:00) Sen. V. Taylor said that low income tax credits had come up as a problem during the hearings by the Select Committee on Property Tax Relief and Reform. Sen. V. Taylor said the grants were allocated by TDHCA and tax-credit developments, under HUD, could not reflect market conditions. Sen. V. Taylor said that because those developments could not be adjusted for property taxes and they did not qualify for homestead taxes, there had been inconsistency in the appraisals across CADs. Sen. V. Taylor said the low number of these developments took a disproportionate amount of time for CADs and he had brought together tax -credit developments and CADs to create legislation to create clarity in appraisal and levies to tax-credit developments. Sen. V. Taylor reviewed provisions in the bill and said it did not seek to expand or limit affordable housing, but to clarify the process to provide consistency.
Sen. Nichols said that the fiscal note did not show much fiscal impact immediately, but by 2020 there was $50 million in total losses to FSP, ISDs, counties, municipalities and political subdivisions. Sen. V. Taylor said he understood, but that the properties often had to close because they could not maintain low rents and afford their property taxes. Sen. V. Taylor said they were working to reduce the fiscal note.
Sen. West said he appreciated the bill and asked what other state were doing to accommodate affordable housing in their tax codes. Sen. V. Taylor said his process was to allow the CADs and tax-credit development owners to work on a solution together rather than to look at other states, but that those entities may have used that information. Sen. V. Taylor said that many people were under the impression that affordable housing complexes could raise their rates at any time like other complexes, but HUD restrictions prevented them from doing so. Sen. V. Taylor said the solution had been to set an appraisal and maintain a certain rate of growth pegged to inflation and median household income. Sen. West said he would like to see what other states had done.
Sen. Nelson asked if they were looking to reduce the impact of the fiscal note. Sen. V. Taylor said they were and he would allow their resource witness to speak to that. Sen. Nelson said, “Good,” adding that she liked the idea, but that she did not support large losses of funding.
Cynthia Bast, TAAHP, testified for the bill. Ms. Bast said they had worked closely with the TAAD to come up with the solution. Ms. Bast said tax-credit developments were not only restricted in the amount they could raise rental income, but also in when they could sell a property. Ms. Bast said the rising property taxes “far outstrip” the amount they could increase rents by per year and the bill would create consistency between the net increases allowed for rents and property appraisals. Ms. Bast said they could not be limited to a 1% increase on rental income while the property values were increasing in the double digits per year. Ms. Bast discussed the 3 year rollback which would provide recovery of taxes for the local entities should the property be sold as a claw-back provision.
(11:12) Sen. Nelson asked how much the fiscal note would be reduced. Ms. Bast said she did not know, they were still working on it.
Emily Protine, Bonner Carrington, testified for the bill. Ms. Protine said the property taxes for services were often at odds with low-income housing availability and discussed protests her firm had represented tax -credit developments. Ms. Protine said the bill would create consistency and save both time and money at the local level by avoiding litigation.
Bobby Bowling, TAAHP and TAA, testified for the bill. Mr. Bowling said the property code designated tax-credit developments separately, but did not codify how they were to be appraised. Mr. Bowling said the bill was simple and they had encouraged the CADs to utilize underwriting assumptions from TDHCA as the developers used when making investments in constructions. Mr. Bowling said the properties were “almost never sold” which created a misunderstanding in the analysis which led to the large fiscal note. Mr. Bowling said he had 28 of the properties in his portfolio and felt the fiscal note did not account for the amount of savings from the prohibition of lawsuits contained in the bill. Mr. Bowling said if each county in the state avoided one $40 thousand lawsuit, they stood to save $10 million.
Sen. West asked about what other states were doing. Mr. Bowling said because other states used income taxes and other funds, they could not adequately account for what other states were doing and it required the state to “pioneer its own trail”. Sen. West suggested they contact the National Conference of State Legislatures to find out what other states without income taxes did.
Sen. Bettencourt asked them to look at IL and NY as well because they had higher taxes. Sen. Bettencourt and Ms. Protine discussed properties which had increased 25-86% over time on their values. Sen. V. Taylor said that they could not match an 86% increase in appraisals with a 1% increase in rents. Sen. Bettencourt said they were being “swept up” with general land value increases.
Jeff Law, TAAD, testified for the bill. Mr. Law thanked Sen. V. Taylor for “bringing the two sides together to work on this bill”. Mr. Law said he believed the bill would resolve inconsistencies in how the properties in question were appraised and would have better audited and more reliable data. Mr. Law said he did not believe the bill prohibited property owners from filing lawsuits, but it would reduce the potential for litigation which would benefit the appraisal districts by reducing litigation costs.
Barry Kahn, Texas Association of Builders and Texas Apartment Association, testified for the bill. Mr. Kahn said they had always faced challenges with the ARBs and understood if those who had not worked in the area were “having difficulty grasping the concepts”. Mr. Kahn said the limited time for training ARB members led to those members not fully understanding the issues they were ruling on with the properties in question. Mr. Kahn discussed the causes for litigation on his properties. Mr. Kahn said as a board member of the National Association of Home Builders they had created a panel to discuss the matter and found no consistency between states due to the variations in tax revenue sources across states.
(11:27) Sen. Bettencourt recalled testimony Mr. Kahn had provided at the Arlington hearing and asked what happened after the hearing. Mr. Kahn said he was not sure what the differential was, but the properties were not classified as apartments. Sen. Bettencourt and Mr. Kahn discussed the matter further.
Congratulations to The NRP Group for making the National Multifamily Housing Council’s 2017 Top 50!
USDA Rural Development Recognizes Three Apartment Communities
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Urban Affairs Hearing. March 17, 2017
The three bills listed below were left pending in committee. This is the custom of several committees. The bills will be eligible for consideration and passage out of committee at the next meeting, March 21st.
Rep. King stated that it would be his preference that the letters be done away with altogether. If that was not possible he wanted to share the pain with Senators again.
House Urban Affairs
The House Committee on Urban Affairs, under the direction of Chair Alvarado, met yesterday afternoon at 12:44.
HB 885 By King, Ken. Relating to the system by which an application for a low income housing tax credit is scored. – left pending
(12:45) Rep. Ken King said his bill would add state senators back to the scoring process.
(12:48) Demetria McCain of the Inclusive Communities Project testified in opposition to the bill, noting how a state elected official can stop low-income housing in white neighborhoods because that official’s office is “bombarded” by people opposing the project.
(12:52) Jean Langendorf of Disability Rights Texas spoke against the bill, stating no need for a senator to be involved in scoring.
HB 616 By Leach, Jeff. Relating to the system by which an application for a low income housing tax credit is scored. – left pending
(12:55) Rep. Leach stated his bill would remove the state representative letter from the scoring process because of “abuse” and the “ripeness of corruption.” He told of the “inordinate amount of time” his office used to spend on these real estate development projects and now is neutral on all projects.
(1:03) Demetria McCain of the Inclusive Communities Project testified in support of the bill and discussed how low-income housing projects are required to have another level to the process and how HOAs “act vehemently upon their biases” against minorities.
(1:05) Craig Alter of Commonwealth Development spoke in favor of the bill, saying the process “should not be politicized.” Responding to Rep. Isaac, Mr. Alter stated 1.5 million of Texas’ 3 million rental households are overcrowded, have physical deterioration, or spend greater than 30% of gross income on rent. Rep. Isaac noted bureaucratic control and Mr. Alter noted local control.
(1:11) Charlie Price of the Development Corporation of Tarrant County testified in opposition to the bill. He said state representative involvement is a “great tool” in the process, and deals have community support before the state rep’s letter.
(1:17) Jean Langendorf of Disability Rights Texas testified neutral on the bill, stating it is “another level of concern” with regard to fair housing.
(1:18) Justin MacDonald of the MacDonald Company and representing the Texas Assn. of Builders spoke in favor of the bill because it removes a “substantial barrier” to housing development.
(1:21) Sarah Anderson of the Texas Coalition of Affordable Developers testified in support of the bill, stating local support is “crucial” to development. Rep. Leach mentioned the role of commissioners’ courts and ETJs. Rep. Isaac asked why not start with the state rep. first and Ms. Anderson answered her organization does once a city is interested in a project. Rep. Leach noted his bill only removes the state rep. from the scoring process and he or she can still participate in it.
(1:30) Terry Anderson of Anderson Development and Construction spoke in favor of the bill, remarking how community support is important.
(1:34) Charlie Duncan of Texas Low-Income Housing Information Service testified in support of the bill. He said a state rep. can “block” a housing project and “objective metrics” are needed. Rep. Leach spoke of the potential influence of campaign contributions by developers.
(1:38) David Riddle, former commissioner of Harris Co. Housing Authority, testified in opposition to the bill, saying taxpayers must be able to contact their elected officials.
(1:41) Toni Jackson, a Houston lawyer who specializes in affordable housing projects and representing the Texas Affiliation of Affordable Housing Providers, testified in support of the bill. She discussed how political influence and NIMBYism is greater than addressing housing needs.
(1:52) Bobby Bowling, an El Paso developer and representing the Texas Affiliation of Affordable Housing Providers and the Texas Apartment Assn. testified in support of the bill, mentioning how no other state uses state officials in the scoring process. Discussion ensued.
(2:09) Tim Irvine of TDHCA said “competition is based solely on the score” of housing projects. Such projects are at a “significant point disadvantage” without the state rep. letter which has become “de facto necessary.”
(2:15) Rep. Isaac said he is “no” at the moment on the bill but looking forward to working on it. Rep. Leach said he is looking toward a “workable solution.”
HB 1609 By Price, Four. Relating to the system by which an application for a low income housing tax credit is scored. – left pending
(2:17) On behalf of Rep. Price, Chair Alvarado said the bill would keep state reps. in the process but only in districts which contain a county with a population of greater than 450,000 residents.
(2:20) Charlie Duncan of Texas Low-Income Housing Information Service testified in support of the bill.
(2:21) Bobby Bowling, an El Paso developer and representing the Texas Affiliation of Affordable Housing Providers and the Texas Apartment Assn. stated all low income housing deals have had a letter of support from a state rep.
The committee adjourned at 2:24 p.m.
Urban Affairs Hearing. March 14, 2017
The House Urban Affairs Committee held an organizational meeting yesterday where Bobby testified on TAAHP’s behalf. A report on the meeting follows.
The House Committee on Urban Affairs met this afternoon under the direction of Chair Alvarado, who called the meeting to order at 11:33.
The Texas Municipal League said it strongly supports city governments to continue their significant role in promoting affordable housing and generally supports taking all options into consideration for local governments to promote affordable housing.
Bobby Bowling, President of the Texas Affiliation of Affordable Housing Providers, said “the letters requiring local approval empowers jurisdictions to exercise what some call a vocal veto…that’s exactly what I’m testifying to you today. That’s a problem.” Bowling mentioned an IRS federal program that is “basically saying that the way Texas is doing it is calling into question the legality and its hospice is to do what we’re doing in Texas and still not violate the Fair Housing Act.”
Bowling said he wanted to make sure the committee was aware that the league may be jeopardizing their funding from the IRS program “when they put out an aggressive ruling like this that is tailormade to address what’s going on in Texas.” Bowling then noted that he had the opportunity to go to the Texas Municipal League Conference early last fall on a panel addressing this issue with along with Chair Alvarado, and “no one was standing up saying yes keep us in this.” Bowling said things were becoming worse and more difficult each year, and they “are getting to a point where some regions of the state are just going to go without affordable housing.”
Lisa Stevens, President of the Texas Coalition of Affordable Developers, began her testimony by describing the vastness of her organization. She stated that amongst her group, they have generated approximately 40,000 units of affordable housing through the TDHCA program. They represent both for profits and nonprofit, as well as both rural and urban areas, making for a very large sector of the state they must cover. To give the committee an idea of the scale of what Bowling discussed regarding the IRS revenue ruling, Stevens addressed some of the correlating numbers. Stevens said the tax credit allocation from the federal government to the TDHCA is roughly 65 million dollars per year, and noted that this is a 10 year allocation, so each allocation is worth 650 million dollars to the Texas Building Economy. The city would also have a “multiplier” regarding economic benefit when “those folks who are working in the construction go out and spend their dollars in the local economy.” When the multiplier is factored into the total, there would be an impact 800 million dollars annually on the local economy. Stevens noted other tasks of the agency, which included focusing on other bills that are diametrically opposed, and helping the community understand the purpose and impact of such bills.
Ron Williams, President of the National Association of Local Housing Finance Agencies, addressed Chairwoman Alvarado, Rep. Elkins, and Rep. Johnson directly, saying “In Harris County alone, in the past 4 years SETH has provided 2,570 homebuyers with an average annual income of 54, 000 with over 364 million dollars in mortgage funds. And most notably had provided those families with over 17.8 million in grant funds that do not have to be repaid for down payment and closing costs.” Williams said in Rep. Leach’s district, SETH had provided 213 home buyers with 37. million dollars in mortgage funds and over 1.8 million in grant assistance.
Williams told Rep. Bernal that in Bexar County alone, SETH had provided over 1,079 homebuyers with over 140 million in mortgage costs, and 6.8 million in grant funds. Williams then addressed education and said in the past 4 years, SETH had educated 17,400 homebuyers prior to their home purchase. Williams noted a study had shown that homebuyers who complete homebuyer education courses before purchasing their home had much lower foreclosure rates.
Chair Alvarado thanked Williams for his testimony and asked the agencies before her to provide some clarification on “What it means to write one letter, what it means to write a letter for everybody…and how that effects the process?” Bobby Bowling explained that there are 3 positions the committee members can take: writing letters in support, remaining neutral, or write a letter in opposition. Vice Chair Leach commented on the amount of time he had wasted by being approached to sign letters. Leach said he noticed that once he signed a single letter, he would get an abundance of requests for more signatures, which would take time away from his real duties. “My policy has always been that I’m neutral and I’m not signing letters. In fact, I think my reputation across the state is ‘don’t go to representative Leach, he’s not going to sign a letter.'”
The panel then examined and discussed their program in more detail. Lisa Stevens said when observing this program both federally and in the state, the foreclosure rate is <1%, and when compared the foreclosure rate of conventional apartments the rate is much higher. She added that there was a Harvard study published last year that discussed the impact of Affordable Housing Developments on their communities; the results of this study proclaimed the impact as neutral to positive, and there “Is not a negative impact under today’s tax credit program.”
Rep. Elkins questioned Bowling on the cost of developing a typical unit that their program provides and what the unit would include. Bowling replied that they would “probably have 2.5 bedrooms and 1.5 bathrooms.” He confirmed that they are expected to be approximately 1,000- 1,100 sq. feet, and the hard construction cost per unit will total to an amount of approximately 65K to 70K. Rep. Elkins asked “that’s gonna be about 210K a year in property taxes?” Bowling confirmed that it would be and said ” To get to the answer or question I think you’re looking for, my properties tax rolls at about 30K per unit.”
Lisa Stevens said there would be two options for evaluating income approach / replacement cost approach. “The 65K construction cost would be replacement coast approach,” she said. Stevens added that they don’t have enough rental income to cover taxes based on replacement cost. ” These properties would go broke, and so the statute actually allows for affordable housing properties to be assessed on the income we generate.”
Chair Alvarado asked Bowling on the cost of rent; he said the average rent is $650, and with a nontax credit the same unit would be approx. $750-$780, but all rent is very specific to the location in the market.
Developer’s View: Diana McIver Makes the Case for Mixed-Income Housing
Meet Diana McIver, president and CEO of DMA Cos., an affordable housing developer based in Austin, Texas. She explains the importance of mixed-income housing, what she looks for when siting a development, and how she responds to the increasing amount of NIMBYism.
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Granger MacDonald, a Kerrville, Texas-based builder and developer with 40 years of experience in the home building industry, was elected as the 2017 chairman of the National Association of Home Builders (NAHB) during the association’s International Builders’ Show in Orlando, Fla.
MacDonald is chairman and CEO of the MacDonald Companies, a diverse development, construction, and property management enterprise with nearly 50 neighborhoods completed and managed throughout Texas.
“We look forward to working with incoming Trump administration and Democratic and Republican leaders in the new Congress to promote policies that will boost home ownership and rental housing opportunities for all Americans,” said MacDonald in a press release. “Specifically, we will seek to reform the regulatory process and ensure any tax reform efforts protect vital housing tax incentives that are needed to keep the economy moving forward. We will also urge Congress to enact comprehensive housing finance reform, with the federal government acting as a backstop in times of crisis, to protect the 30-year mortgage and bring the flow of private capital back into the marketplace.”
MacDonald has been active in the NAHB leadership structure at the local, state and national levels throughout his career. A senor life director, he has served on the NAHB Board of Directors for more than 30 years and is a member of the NAHB Executive Board.
He has also served as chairman on several influential NAHB committees and councils, including the Federal Government Affairs Committee, the State and Local Government Affairs Committee, the Housing Credit Group, the Multifamily Council and BUILD-PAC, the political action committee of NAHB.
MacDonald was elected president of the Texas Association of Builders in 2010 and is a member of the Hill Country Builders Association, the Greater San Antonio Builders Association, and the Home Builders Association of San Angelo.
Actively involved in his community, he has had years of experience working with and serving on governmental commissions and boards. He served on the Kerrville/Kerr County Airport Board and the City of Austin Planning Commission. He was also chairman of the City of Austin Environmental Board and president of the Upper Guadalupe River Authority.
click to read/print HUD Letter: HUD-letter-to-Mayor-Sylvester-Turner-find-civil-rights-violations
Federal housing agency: Houston housing policies violate Civil Rights Act
By Rebecca Elliott Updated: January 13, 2017 5:38pm <http://www.houstonchronicle.com/author/rebecca-elliott/>
Developer’s View: Diana McIver Makes the Case for Mixed-Income Housing
Meet Diana McIver, president and CEO of DMA Cos., an affordable housing developer based in Austin, Texas. She explains the importance of mixed-income housing, what she looks for when siting a development, and how she responds to the increasing amount of NIMBYism.
Dominium Hits a Major Milestone—25,000 Units
Minneapolis-based developer and manager is now the second-largest affordable housing provider in the country.
Minneapolis-based developer and manager Dominium now owns or manages 25,000 units across the country, making it the second-largest provider of affordable housing in the nation. The company has been developing its portfolio since its founding in 1972.
Dominium currently manages 200 property sites across 22 states. It acquired 2,943 affordable housing units in 2015, but it has already surpassed that number this year to date with over 3,000 units acquired so far. Its most recent acquisitions are The Cambric, Grainwood, and River North, three 55-plus independent living properties that are currently under construction in St. Paul, Minn., and the surrounding area.
“This is an important time for our company,” says Paul Sween, co-managing partner at Dominium. “ We believe there will be continued strong demand for high-quality affordable housing and we are committed to developing innovative projects that meet the needs of growing communities across the country.”
Dominium’s history in the affordable housing sector has led to strong relationships with commercial banks, lenders such as Fannie Mae and Freddie Mac, and the U.S. Department of Housing and Development according to Sween. “They’re very important sources of capital and we have very good relationships with them as well, and we do that by performing in a predictable and reliable manner,” he says.
The company plans to expand its holdings to more than 40,000 units by 2025 and grow its staff to keep pace with the needs of a growing portfolio.
“We think it’s a very opportune time right now in the multifamily industry, and we know those things don’t last forever,” Sween says. “So we’re trying to be as productive as we can while the environment’s so good.”
Texas Affiliation of Affordable Housing Providers has elected Bobby Bowling president of the organization’s board of directors. Bowling is one of El Paso’s top
developers of affordable housing, and has long been an advocate of ensuring adequate access to quality affordable living for Texans.
The organization is a recognized voice for affordable housing providers at the state Capitol. The nonprofit affiliation of developers and other affordable housing providers works to increase the supply and quality of affordable housing for those with limited income and special needs.
“I am honored to be serving as the president of TAAHP and to help guide the organization’s efforts as we respond to the challenges of providing affordable housing opportunities.” Bowling said. “It is our goal to educate state leaders and the public on the importance of affordable housing to our communities and to our society.”
“Expanding quality affordable housing opportunities increases financial stability and economic mobility among individuals and families. It improves children’s school performance and has been shown to enhance the health of a population,” added Bowling.
Bowling is president of Tropicana Building Corporation, one of El Paso’s oldest and largest home builders. Tropicana Homes also manages about 3,000 affordable housing units and invests in its communities by providing residents with free GED and ESL classes.
The Texas Affiliation of Affordable Housing Providers was founded in 1997 and represents housing industry professionals involved in the financing, design, development and management of affordable housing communities in Texas through public/private partnerships.
REVITALIZING TEXAS COMMUNITIES, BOND BY BOND
Like any good opportunity, as soon as the boom begins, skeptics try to predict the bust. Despite economic factors such as the drop in oil prices, the Texas housing market has continued its momentum over the past several years. According to news outlets, the main factors powering this inertia are job growth and population growth; in other words, consumer demand.
As a trustee in the public finance market, Wilmington Trust has experience on the backside of the transaction that leads us to add a third component fueling this prolific mixture—stable and affordable public housing financing. More and more projects are being funded by issuing bonds and tax credits. While we facilitate transactions where ‘market rate’ bonds are used to finance sprawling apartment complexes complete with the latest in urban amenities, many of our clients utilize low income housing tax credits (LIHTC) in connection with multi-family bonds to fund their projects.
To help meet the housing needs of both a younger workforce and retired individuals, The Texas Department of Housing and Community Affairs (TDHCA) reported that they have allocated $65.3 million in federal housing tax credits to private developers who are creating rental properties that offer reduced rents.
Both developers and housing corporation/authorities will issue bonds to finance a multi-family housing project. As the trustee, we see the transaction unfold from the issuance of the bonds (amidst other various layers of funding), to the procurement of the real estate, to the underwriter who finds the buyer for the bonds, and finally the culmination of the bonds to cash proceeds.
The trustee role remains until the bonds are paid off; this could be a couple of years or a couple of decades, depending on the terms of the deal.
Greg Hasty, Vice President, Wilmington Trust, N.A., heads Wilmington Trust’s Texas business development effort that specializes in public finance to the housing market. He comments: “The projects we are seeing are not like before, some of the nicest projects in the Texas cities are being built with bonds. So the old perception of impoverished housing projects is a thing of the past. The new projects are beautiful and are amazingly affordable.”
Contact Greg Hasty at (972)383-3153 to learn more about the Corporate Trust solutions offered by Wilmington Trust or visit www.wilmingtontrust.com/publicfinance.
Wilmington Trust is a registered service mark. Wilmington Trust Corporation is a wholly owned subsidiary of M&T Bank Corporation (M&T).
For Immediate Release: Contact:
August 16, 2016 Cody Z. Langeness
Brian A. Renzi (212) 297-1800
RED STONE TAX-EXEMPT FUNDING PROVIDES $49,830,000 IN TAX-EXEMPT BOND FINANCING FOR THE NEW CONSTRUCTION AND PRESERVATION OF 491 AFFORDABLE RENTAL UNITS DURING JULY 2016
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NEW YORK, N.Y. – During the month of July, Red Stone Tax-Exempt Funding (“Red Stone”) successfully structured and closed three tax-exempt bond transactions totaling $49.83MM via its Red Stone Direct investment platform. These investments will provide debt financing for the new construction and preservation of affordable rental communities in California, Colorado, and Texas. Cody Z. Langeness, President of Red Stone, commented “We are proud of the effort and cooperation which was necessary to ensure the efficient closing of these transactions. Despite each property being located within a unique geographic location, all three transactions were closed within the last 30 days. Most importantly, these high-quality developments will introduce much-needed affordable rental units into their respective communities.”
Red Stone provided $17,150,000 for the preservation of St. Timothy’s Tower & Manor, a 135-unit senior citizen Section 8 rental property in Los Angeles. The transaction was sponsored by Blue Green Preservation & Development, LLC. In addition to Red Stone’s tax-exempt bond investment, approximately $7,500,000 of equity capital was invested through the purchase of federal low-income housing tax credits (“LIHTCs”) allocated to the transaction. This transaction involved a 20-year extension of the property’s Section 8 Housing Assistance Payment (“HAP”) contract, ensuring long-term affordability for its senior citizen tenants. The property’s tenants will benefit from an extensive rehabilitation totaling over $40,000 per unit.
Red Stone provided $15,450,000 for the new construction of Centennial Park Apartments, a 140-unit affordable multifamily rental community in Longmont. The transaction was sponsored by Summit Housing Group, Inc. The development’s financing structure also included state and federal LIHTC equity capital totaling approximately $14,560,000 and $4,000,000 of Disaster Recovery Funds provided by the State of Colorado Department of Local Affairs. Centennial Park Apartments will be one of the first newly constructed affordable communities in northern Colorado, an area which suffered immense damage as a result of severe flooding during 2013. The property will introduce a much-needed supply of affordable rental housing for residents earning between 40% and 60% of the area’s median income.
Red Stone provided $17,230,000 for the new construction of Sansom Pointe Apartments, a 216-unit affordable senior citizen rental community in Sansom Park. The transaction was sponsored by LDG Development, LLC. The property’s financing structure included approximately $12,270,000 of equity capital invested through the purchase of federal LIHTCs allocated to the transaction. The property will provide senior citizens in the Fort Worth metropolitan area with an affordable rental option featuring modern in-unit amenities and on-site community offerings such as an arts-and-crafts room, a fitness center, a swimming pool, a resident-services coordinator office, and a health-screening room.
Via the Red Stone Direct tax-exempt bond investment platform, Red Stone was able to provide competitive financing facilities for these transactions while minimizing costs and delivering on its certainty- of-execution guarantee. Brian A. Renzi, Red Stone’s Managing Director, added “Red Stone is proud to have provided tax-exempt bond financing that will facilitate the creation and preservation of these high- quality developments. All will be great additions to our growing portfolio of tax-exempt bond investments supporting affordable rental communities nationwide.”
About the Company:\
Red Stone is a national real estate finance company which specializes in tax-exempt bond financing. Red Stone Tax-Exempt Funding LLC—through its Red Stone Direct platform—is a direct purchaser of tax-exempt bonds used for the construction, preservation, and refinancing of affordable multifamily properties nationwide. In addition to Red Stone’s core tax-exempt bond business, the firm also offers bridge lending, mezzanine financing, and other creative financial products for the affordable housing industry.
For more information, please visit our website at www.redstoneco.com.
Locke Lord LLP Announces Neal Rackleff, Former City of Houston’s Housing Director, Rejoins as Partner in Austin/Houston Offices
Neal Rackleff, who has served as Director of the City of Houston’s Housing and Community Development Department (HCDD) since 2012, has rejoined Locke Lord as a Partner working out of the Austin and Houston offices. Neal, who oversaw the city’s community development projects, strategic planning for affordable housing and neighborhood revitalizations, will focus his practice on community and economic development, affordable housing, and municipal and public law.
“Neal has extraordinary experience with federal, state and local programs for affordable housing and community development, resulting in numerous innovative projects,” said Cynthia Bast, Chair of Locke Lord’s highly regarded Affordable Housing and Community Development Section. “Combining his governmental and legal perspective will allow us to give added value to our clients across the country. We are thrilled he is part of our team.”
Among his most significant accomplishments as Director of HCDD, Neal turned around the troubled $109 million CDBG Disaster Recovery Round 1 program, proving Houston’s ability to administer the complex housing program and leading to the allocation of an additional Disaster Recovery grant of $178 million in Round 2 of the program. When the Round 2 program was threatened with litigation from fair housing advocates, he negotiated an unprecedented agreement which engaged multiple communities and allowed Disaster Recovery dollars to be focused toward revitalization of targeted historically underserved, low-income areas.
In total, during his term as Director, HCDD produced 7,800 multifamily housing units (with another 2,700 in progress) and assisted 1,700 single-family homeowners with reconstruction of hurricane damaged homes, financial assistance to low-income homebuyers and emergency home repairs to ameliorate health and safety issues. Neal also spearheaded the redevelopment of the historic downtown building now housing the J.W. Marriott Hotel and negotiated Houston’s first public/private partnership to address food deserts in the city.
Published 06/29 2016 05:58PM Updated 06/29 2016 05:58PM