REGIONAL NEWS

MIDWEST

AFFORDABLE HOUSING FINANCE • April 2008

Construction Under Way for Affordable Duplexes

LA PORTE, IND. -- The nonprofit Parents & Friends, Inc., will build the Butterfly Garden Apartments here.

The affordable project for adults with disabilities includes eight units housed in four duplex-style buildings. Each apartment will have three bedrooms, and a washer and a dryer.

The project received a $360,000 grant from the Federal Home Loan Bank (FHLBank) of Indianapolis. Construction is scheduled to begin in April.

Six Affordable Projects in Michigan Get Funding

DETROIT -- The FHLBank of Indianapolis' Affordable Housing Program has approved $1.35 million in grants to help fund four affordable housing projects in Michigan.

The developments include Springwells Partners V, a 29-unit affordable community, and Southwest Housing Partners III, a mixed-use project that will include 18 apartments-both in southwest Detroit and sponsored by Southwest Housing Solutions Corp.

The remaining projects receiving funding are Brush Estates, a 75-unit townhome development in northeast Detroit, sponsored by Emanuel Community Center, and Sycamore House, a 40-unit building in Durand sponsored by the Shiawassee Council on Aging.

NORTHEAST

Boston Capital Finances New Apartments

TOMS RIVER, N.J. -- Community Investment Strategies, Inc., based in Bordentown, N.J., will build Toms River Crescent Apartments, a 120-unit affordable apartment complex here. The project will target households maxing out at 60 percent of the area median income (AMI).

Located on 10.3 acres, the development will include 15 buildings containing 84 two-bedroom and 36 three-bedroom units. Units will include washers and dryers, dishwashers, patios or balconies, and walk-in closets. The property will include Energy Star appliances, and the project's community building will feature a solar photovoltaic system.

Amenities will include a community room with a kitchen, a storage room, a jogging path, a computer center, and a playground. Social programs available on site will include computer education classes and financial literacy programs. Boston Capital provided the lowincome housing tax credit (LIHTC) equity for the development. Boston Capital Finance, LLC, provided a constructiononly loan, which totaled $10.8 million.

Boston Capital Finance manages a construction- only fund, BCF Funding, LLC, which originates construction-only loans sized between $1 million and $12 million.

SOUTH CENTRAL

New Apartments Open on Previous Shelter Site

HUTCHINSON, KAN. -- New Beginnings, a locally based nonprofit, has completed New Beginnings apartments here. The 28-unit building will open in mid- March.

The affordable development sits on the previous location of the first New Beginnings shelter, which provided help to homeless individuals. All the units at the development feature two bedrooms and Energy Star appliances.

"Making things green can be affordable," said Shara Gonzales, executive director of New Beginnings. In June, New Beginnings plans to open another apartment complex in Kansas. This development will reportedly be the first in the state with a solar water heater and geothermal climate control.

City To Sell If Demands Are Met

AUSTIN -- City officials in Austin will sell downtown land to a developer, but only if development plans include building affordable and moderately priced housing on the property.

The land is the Green Water Treatment Plant and the nearby Austin Energy property.

Developers have argued that land and building costs in downtown Austin are too high to include much affordable housing there. As a result, the city is not expected to make as much money on the land sale as expected.

"We're not in the business of making money," council member Brewster McCracken said, according to the Austin American-Statesman. "We're in business to achieve public values and goals."

The city also plans to directly subsidize additional units for even lowerincome families and to dedicate 40 percent of the property taxes generated by the redevelopment project, nearly four city blocks, to Austin's affordable housing fund.

Developers will be required to reserve 10 percent of all rental units for households making no more than 80 percent of the AMI, or $41,760 for a one- to two-person household.

Market rates for one-bedroom apartments in downtown Austin are about $1,520 a month, at least $350 more than the targeted households can afford to pay according to a recent report by ROMA Design Group and HR&A Advisors, city consultants charged with writing a new downtown plan.

The city plans to select a developer in June.

SOUTHEAST

Senator Plans to Save Florida's Affordable Housing

NEW PORT RICHEY, FLA. -- To prevent Florida from losing as many as 45,000 units of affordable housing by 2015, Republican Sen. Mike Fasano has introduced a bill that would keep affordable housing subsidies, for both apartments and mobile home parks, in place.

Without intervention, the owners of 15- to 20-year-old apartment buildings in the state have the option of raising rents to market value or converting the units to condos. That's because rental restrictions tied to the original government- backed construction loans are expiring.

Fasano's bill would create the Florida Housing Preservation Program. The bill would use public and private money to allow nonprofits and others to acquire and rehabilitate multifamily rental units and mobile home parks for low-income residents.

The proposal calls for a $50 million appropriation: $25 million for socalled three-year bridge loans allowing properties to be bought and fixed in anticipation of long-term financing being available later; and $25 million to rehabilitate apartments at least 15 years old.

Fasano's plan would use funds that come from Florida's affordable housing trust. Gov. Charlie Crist, however, wants to use funds from the trust for a $75 million downpayment program for homebuyers and place $240 million into the general budget for other expenditures.

The trust contains nearly $600 million, $243 million of which is earmarked for existing affordable housing programs.

WEST

Long Road For Project in Sin City

LAS VEGAS -- Harmon Pines, the first affordable development to be completed under the 10-year-old Southern Nevada Public Lands Management Act, will open here in July. The developer of the project for seniors is nonprofit Nevada Housing and Neighborhood Development (Nevada HAND).

At press time, at least 110 seniors were on a waiting list to move into the 105-unit complex. Five years of work went into Harmon Pines before building began.

Mike Mullen, executive director of Nevada HAND, attended meetings to create regulations for the act in 2003, which includes a provision to sell federal land at discounted prices to encourage construction of affordable housing. The meetings continued for a year before agencies could agree on the regulations.

In 2005, the county handed over five acres of land to Nevada HAND for Harmon Pines. The land was appraised at $3 million, but Nevada HAND got it for $198,000. The project received approximately $11 million of LIHTC equity and $1.3 million in additional funds.

City, Nonprofit Buy Apartments

POWAY, CALIF. -- The city of Poway is teaming with Escondido-based nonprofit Community HousingWorks to buy a rundown apartment complex and renovate the units for those with low incomes. Oak Knoll Villas will target households earning no more than 60 percent of the AMI. The seller of the 35- year-old property is Poway resident Valerie Quate.

The $7 million to $8 million conversion project became possible last fall when officials with the state Department of Housing and Community Development agreed that if Poway buys and renovates a rundown apartment complex, then offers those units to low-income people, the units can be counted toward affordable housing goals the state has set for the city.

State officials said the city must set aside enough land to accommodate 501 new homes for low- and very low income residents between now and 2012 as part of the city's "fair share" of affordable housing.

Each city in California must show how it plans to meet the state set goals for affordable housing, under the state's housing element law. Actual construction is not required. The state does not provide funds for this specific mandate, however, so cities and nonprofits have to find creative ways to create affordable units.