governor’s housing conference 2013 creative financing sources/structures to produce affordable...
Post on 16-Dec-2015
215 Views
Preview:
TRANSCRIPT
GOVERNOR’S HOUSING CONFERENCE 2013Creative Financing Sources/Structures to Produce Affordable Housing
Limited Financing Tools for “Traditional” Affordable Housing
Low Income Housing Tax Credits (LIHTC)
Community Development Block Grant (CDBG)
HOME Investment Partnerships (HOME)
HOPE VI Redevelopment Program
Public Housing and Annual Contribution Contract (ACC)
Local Subsidy
Tax Exempt Bond Financing
Federal Housing Administration (FHA) Loans
PHAs & Affordable Housing Providers Have Limited Universe of Tools
Past Successes
At the Inception of the LIHTC Program HOC Financed 8 Partnerships Utilizing 9% Credits. 316 Units Preserved
Robust Funding Allocation for Housing Choice Voucher Program and Capital Fund Program.
Local Subsidy
Historically Today
6500+ Vouchers Budget Cuts Have Lowered Payment Standards
Capital Fund Program Break-Even Subsidy
Historically Today
Reliable Funding Pool Required Subsidy Has Skyrocketed to 2x/3x. Greater Need, Less Resources!
Paradigm Shift: Blend/Shake/Mix
Our Challenge is to Creatively Leverage Traditional Tools with Market Driven Debt and Equity
1. Who do we serve?Paradigm: Everyone, with a heavy focus on at risk and underserved populations. Shift: How Can Blending in Market Rate Units Advance the Mission?
2. What’s our product?Paradigm: Mixed Income, Mixed Use, Amenity Rich Communities in Transit Oriented Locations Shift: Build a product that communities ask for regardless of end-users!
3. How do we identify creative solutions and bring other products and/or uses to the site?
Partnerships = Risk Mitigation / LeverageLeverage Private Capital = Mixed Income TODMonetize Land Basis in Portfolio = RAD / Legacy AssetsIncrease Density and Sell off Portion to Complementary Use; Create a Sense of Place and Push Demand = Create Equity for Hard to Build, Deeply Affordable Projects
Case Study: Partnership at Chevy Chase Lakes
68 Units on 11 Acres
Montgomery County 500 Square Miles
High Land Costs
Median Household Income = $95,660
Shrinking Green Space
Opportunity Rehabilitate Existing (Low Leverage/Low
Impact)
Redevelop Existing (High Impact/High Risk)
Balance Risk + Return = Partner + Redevelop
70 Luxury Townhomes (For Sale)
+/-200 Apartments (Rental)
Serving 0 – 120% AMI Across Site Deep Long Term Affordability on Rentals
Affordable / Workforce Options on For Sale
Expect Significant Equity from Land Sale = Internal Subsidy for New Building + Other Opportunities
Chevy Chase Lakes Chevy Chase Lakes 2.0
# Units AMI Level
47 120%
21 50%
Case Study: RAD at Elizabeth House
165 Units of Age Restricted Public Housing
1960s Infrastructure
¼ mile from
Next Door to Alexander House (312 Units of Mixed Income)
Adjacent to 1 Acre of Mid-Century Low Rise Commercial (Private Owner)
Partner with Commercial Property Owner
Build Replacement Housing On Site
Redevelop Commercial Site and former Public Housing Site
Re-Calibrate Income Diversity
Revitalize Commercial Uses w/New Tenants
Develop Robust Offer of New Amenities for both Residents & Community
Elizabeth HouseAssemble the Entire
Block (375K Sqft of FAR)
Case Study: Acquisition Platform
Tax Exempt Bonds Advantages: Historically Lower Rates,
Long Term Hold Challenges: Timing, Restrictions
Local Financing Advantages: Cash Flow Contingent, Low
Rates, Deferred Until Sale or Refinance Challenges: Limited Resources,
Increased Needs
Low Income Housing Tax Credits Advantages: Long Term Equity Source,
Mission – Centric, Long Term Hold Challenges: Timing, Uncertainty of
Award (9%), Market Rate Perception
Institutional Equity Advantages: Speed, Perception of
Sellers, Shared Risk, Certainty of Execution, Mitigate Deal/Opportunity Loss
Challenges: Market Driven Returns, Forced Return of Capital (Sale or Refinance)
Partner w/Long-Term Holders Advantages: Alignment of Interests,
Long Term Investment Horizon Challenges: Different Objectives, Risk
of Needs Changing During Hold Period
Conventional Debt Advantages: Speed, Availability,
Perception Challenges: Incongruent with Long
Term Hold, Interest Rate Risk
Traditional Public Financing Tools
Access Capital Markets & Private Investors
top related