knoxville’s community development corporation · kcdc rad conversions summary: •no debt ~...
TRANSCRIPT
Knoxville’s Community Development Corporation
Rental Assistance Demonstration (RAD) Conversion
Affordable Housing Overview for Public Housing Agencies (PHAs)
• 80% of Public Housing was Placed in Service before 1980.
• Major systems have reached the end of their useful life and need replacement.
• PHA Tools to address Capital Needs limited
• Business as usual ~ Operating Subsidy and Capital Funds
• Capital Funds Financing Program ~ Borrowing against future Capital Funds
• Section 18 Demo/Dispo Mixed Finance Strategy ~ typically with Tax Credits
• Choice Neighborhoods Initiative Grants ~ Highly competitive, costly and only 3 or 4 per year
• RAD ~ Conversion of PH units to Section 8 platform (Project Based Rental Assistance or Project Based Vouchers) to support debt if needed (multitude of financing strategies)
• Most PHA Staff has very little/no development experience.
Rental Assistance Demonstration (RAD)…• What is RAD? Authorized in 2012, it is a HUD demonstration program that
combines public housing operating and capital subsidy into a Section 8 HAP contract, and is now authorized for the conversion of up to 225,000 units of public housing. Possible elimination of cap. Interest continues to grow…
• Why was RAD established? HUD’s public housing inventory of 1.2 million units is aging, becoming more obsolete, and has increasing backlog of unmet capital needs. $26 billion in backlog grows by net $1 billion per year. Capital Funding has declined 29% over the past decade. Capital grant funding is insufficient to meet the growing backlog of capital needs.
KCDC RAD Conversions Summary:• No debt ~ internally financed:
• Autumn Landing/Natures Cove (197 units)
• Mechanicsville (48 units)
• Valley Oaks (42 units)
• Five Points Family and Sr. Duplexes (37 units)
• 4% LIHTC/Bonds, Fannie Mae ROAR:
• The Residences at Lonsdale (260 units)
• North Ridge Crossing (268 units)
• The Vista (175 units)
• 9% LIHTC (Five Points) highlighted project:
• Taylor Homes / Lee Williams (317 units)
• HUD 223(f):
• Montgomery Village (380 units)
• Financing to be Determined:
• Austin Homes (129 units)
• Passport (81 units)
• Eastport School (25 units)
• The Residences at Eastport (60 units~ LIHTC)
Five Points Critical Factors Development Summary
• Project subdivided into “Four Phases”
• THDA QAP RAD set aside for 2016 and 2017 (extra point 2015 and 2018)
• Demolition and New Construction
• Site and Neighborhood Standards Approval requirement with New Construction
• Various Financing Strategies for each Phase
• Additional Infrastructure Improvements with City of Knoxville Funding Commitments
History…..
• Units constructed in 1960s
• High density
• Backlog of Capital needs
• Community support of
improvements
History of Investment
• City of Knoxville commitment of Funds
• 20 elderly duplex units
• The Residences at Eastport 85 units
• Demolition of 183 units
• 17 family units of infill housing
…THEN RAD…
Site Masterplan
Phase 1: The Residences at Five Points
• 2015 LIHTC Award for 90 units of elderly/disabled
• Extra point for RAD conversion
• KCDC internal Funds for gap financing
• Completed and fully leased in July 2017
Five Points Phase 2
• 2016 LIHTC Award for 84 units of family units
• LIHTC set-aside for RAD conversion
• Gap Financing
• Home Federal Community Investment Tax Credit with THDA
• KCDC Internal Funding
• In construction ~ completion and fully leased by August 2018
Five Points Phase 3
• 2017 LIHTC Award for 82 units of family units
• LIHTC set-aside for RAD conversion
• Gap Financing
• Home Federal Community Investment Tax Credit with THDA
• KCDC Internal Funding
• In closing process ~ completion and fully leased by July 2019
Five Points Phase 4
• 2018 LIHTC application for 82 units of family units (point for RAD) due March 1
• “Transfer of Assistance” for 43 Austin Homes units
• Gap Financing (TBD)
• Demolition of units involved
• 4 and 5 Bedroom units required
• Plan B Option ~ hopefully not needed
<
EQUAL
H O U 8 N )OP P ORTUNIT
Y
QUESTIONS
Ben Bentley, Executive Director/CEO
Joyce Floyd, VP of Strategic Planning and Development