housingfinance

MuniMae to Sell LIHTC Business

2009-06-29T17:19:00.001-07:00

Municipal Mortgage & Equity, LLC, (MuniMae) has agreed to sell substantially all of its low-income housing tax credit (LIHTC) business to an affiliate of JEN Partners, LLC, a New York-based private equity real estate firm.

The deal involves the LIHTC assets operated by MuniMae subsidiaries, MMA Equity Corp. and MMA Financial TC Corp. other than its interests in certain guaranteed funds.
The approximately $30.7 million sale consists of $18.7 million to be paid in cash and approximately $12 million in liabilities to be assumed by the purchaser.

In a press release, officials said the sale is structured to occur in two closing. The first will cover at least 30 LIHTC funds and the operating assets of the business, inclusive of employments with a cash payment of at least $14 million plus the assumption of liabilities.

The second closing will cover the remaining assets being transferred plus the balance of cash consideration.

MuniMae said it will retain control of certain LIHTC funds in which the firm has guaranteed obligations and will engage the purchaser to manage the funds.

NYC Announces $100 Million Property Purchase

2009-06-25T17:05:00.000-07:00

New York City took a big step toward creating the largest middle-income housing developments since the 1970s.

The development is expected to bring 5,000 new units of housing, the majority of which will be reserved for moderate- and middle-income families.

To accommodate this project, the city announced the $100 million acquisition of 30 acres at Hunter's Point South in Long Island City. It is expected that of the 3,000 affordable units planned, 1,000 will be for families with incomes at 80 percent of the Department of Housing and Urban Development income limit. Another 1,000 units will be for families at the 130 percent income limit, and the last 1,000 for those at 165 percent of the income limit.

Bill Seeks the Exchange of Disaster Credits

2009-06-25T16:41:00.000-07:00

Sen. Evan Bayh (D-Ind.) has proposed legislation to allow Gulf Opportunity Zone and Midwestern disaster area tax credits to be eligible for the exchange program created by the American Recovery and Reinvestment Act.

"Due to the turmoil in the financial markets, developers have found it increasingly difficult to utilize the package of low-income housing tax credits that Congress approved in 2005 and 2008 to speed the rebuilding of affordable housing in designated disaster areas," said a statement from Bayh's office.

The bill ensure that the states that received disaster credits will be able to use the exchange program to convert a portion of their credits into cash grants.

"The economic downturn is making tax credit financing hard to come by, which has hindered the recovery effort in some communities," said Bayh. "By allowing our state to immediately convert these tax credits to cash, Indiana could take advantage of $230 million in federal assistance to spur construction of quality, affordable houses."

The legislation was introduced with Sen. Richard Shelby (R-Ala.).

Dallas Corruption Case Gets Under Way

2009-06-24T08:00:00.000-07:00

There’s some court action in Dallas this week in the FBI’s high-profile corruption case that has an affordable housing developer at its center.

Jury selection was set to begin, but developer Brian Potashnik and his wife, Cheryl, were absent, fueling speculation that they may have cut a deal, reported The Dallas Morning News. The couple was behind Southwest Housing Development Co., one of the largest and most prominent affordable housing firms in Texas.

They are accused of bribing former Dallas Mayor Pro Tem Don Hill and others to support their housing projects.

The local press has called the case “Dallas’ biggest political scandal in a generation.”

Seattle Prepares to Vote on Housing Levy

2009-06-12T08:21:00.000-07:00

The Seattle City Council voted unanimously this week to put a $145 million, seven-year property tax on the November ballot to raise money for affordable housing.

The council backed Mayor Greg Nickels' proposal after some early speculation that a smaller amount would go before voters in these hard times.

The proposed levy would cost $17 per $100,000 of assessed property value. That would be about $79 a year for the average Seattle homeowner, an increase from the current $49 housing levy.

Under the proposal, $104 million would be dedicated to building or renovating 1,670 affordable rental units. The council said that 60 percent of the $104 million would be reserved for people earning no more than 30 percent of the area median income.

If there's a community that will support a housing levy, it's Seattle. The city has voted in favor of a levy on three occasions. Will Seattle make it four?

Bay Area Welcomes Two New Developments

2009-06-11T21:17:00.000-07:00

It was a big day for affordable housing in the San Francisco Bay Area today, with the opening of two notable developments.
In Berkeley, Resources for Community Development (RCD) celebrated the completion of Oxford Plaza, a 97-unit development for low-income families and individuals.
It is the signature project for the 25-year-old nonprofit organization, said Daniel Sawislak, RCD executive director.
Oxford Plaza is a green, transit-oriented community next to the new David Brower Center, an environmental complex that will be a hub for several nonprofit organizations. Brower was the Sierra Club's first executive director.
Mayor Tom Bates said he couldn't be happier with the outcome. "We've got 97 family units in Berkeley," he said. "That's a high accomplishment."
The project was financed with the help of low-income housing tax credits.

Arnett Watson Apartments
Across the bay in San Francisco, Community Housing Partnership (CHP) and Tenderloin Neighborhood Development Corp. held a grand opening ceremony for the Arnett Watson Apartments.
The nine-story development is named after one of CHP's original residents and a tenant leader. Watson died in 2003, but her spirit carries on.
"She was on the street and never forgot that," said homeless advocate Paul Boden, who joined others in remembering Watson. He had no doubts that she would have responded to the tribute in her usual tough manner.
It would have been "what the hell are you doing?" Boden said.
Jeff Kositsky, CHP executive director, said he hoped the new residents would continue Watson's fight for the homeless.
The 83-unit project is the first new construction deal for CHP, which has a history of rehabilitating the area's single-room occupancy hotels into housing.
Arnett Watson Apartments was also funded with housing tax credits.

Seattle Mayor Seeks New Housing Levy

2009-04-30T16:06:00.000-07:00

Seattle Mayor Greg Nickels has proposed a new housing levy to raise money for affordable housing in the city. It comes as the current seven-year, $86 million levy is set to expire this year.

Nickels wants a new seven-year levy that's even bigger-$145 million. For the average homeowner, the property tax would be $79 a year or as the mayor likes to say just $6.60 a month. The funds will go toward several areas, including $104 million to build and preserve about 1,670 affordable rental units.

Here's a link to watch a video of his announcement:

http://www.seattlechannel.org/videos/video.asp?ID=1060934

Boston’s Henriquez Picked for HUD Post

2009-04-10T15:36:00.000-07:00

Sandra B. Henriquez, administrator and CEO of the Boston Housing Authority, has been nominated by President Barack Obama to be assistant secretary for public and Indian housing at the Department of Housing and Urban Development (HUD).

Her appointment is the latest key move in assembling the new HUD leadership team.

An industry veteran, Henriquez is well familiar with HUD's public housing programs. She assumed her duties as the administrator and CEO of the Boston Housing Authority in April 1996. She is the chief of public housing for the city, which is a cabinet position within the administration of Mayor Thomas M. Menino. She previously served at the Boston Housing Authority in various capacities from 1977 to 1983.

She is the immediate past president of the Council of Large Public Housing Authorities (CLPHA).

“Sandi is widely recognized as a national leader on affordable housing issues, and we are confident and optimistic she will make a tremendous contribution,” said Sunia Zaterman, executive director of CLPHA, in a prepared statement. “She has a great vision for the future of public housing, proven leadership, and ability to forge critical partnerships that can help meet our nation’s affordable housing needs.”

Henriquez serves on multiple boards, including YWCA Boston and the Massachusetts Housing Investment Corporation.

Obama has picked several industry veterans from around the country to serve at HUD, starting with Secretary Shaun Donovan, who was commissioner of the New York City Department of Housing Preservation and Development. He also recently selected affordable housing developer Carol Galante of BRIDGE Housing, a California nonprofit organization, to be deputy assistant secretary for multifamily housing programs.

Developer Picked to Lead Arizona Agency

2009-03-26T17:30:00.000-07:00

Donald E. Cardon has been named director of the Arizona Department of Housing.

Prior to his appointment, Cardon served as president and CEO of Cardon Development Group, LLC, building low-income housing tax credit projects through out the state. He also worked as deputy housing director for the city of Phoenix.

He was named to head the state housing agency by Gov. Jan Brewer.

Cardon replaces Fred Karnas, who left the agency to join the federal Department of Housing and Urban Development as senior adviser to Secretary Shaun Donovan.

BRIDGE's Galante Heads to HUD

2009-03-17T15:02:00.000-07:00

Carol Galante, the longtime president and CEO of BRIDGE Housing Corp., has been appointed deputy assistant secretary for multifamily housing programs at the Department of Housing and Urban Development (HUD).

She will be responsible for HUD's financing support for the development and preservation of privately owned rental housing (a current portfolio of more than $58 billion) and will be integral to several new initiatives that promote sustainable development.

Galante joined BRIDGE as vice president in 1987 and was named president in 1996. San Francisco-based BRIDGE is the largest nonprofit developer of affordable housing in California.

The organization's board has asked Lydia Tan, executive vice president, to serve as interim president. Board Chairman and co-founder Rick Holliday will oversee the recruitment of the next CEO. Consultant Helen Dunlap has been retained to guide BRIDGE through a strategic planning process and executive search.

Karnas Heads to HUD

2009-03-04T14:29:00.000-08:00

Fred Karnas has been appointed senior adviser to Shaun Donovan, secretary of the Department of Housing and Urban Development (HUD).

Karnas leaves his post as director of the Arizona Department of Housing.

The appointment marks Karnas' return to HUD, where he served as deputy assistant secretary from 1995 to 2000.

POAH Takes Over Six Florida Projects

2009-02-24T08:21:00.000-08:00

Preservation of Affordable Housing (POAH), Inc., has closed on the purchase of six affordable rental properties in Florida, with a total of 846 apartments. The $49.2 million transaction involved five properties in Miami and one in Jacksonville.

The seller was Greater Miami Neighborhoods, Inc., a local nonprofit that is going out of business after more than 20 years. The group reached out to POAH to preserve the assets when it became apparent that the organization’s operations would not continue.

Boston-based POAH is a national nonprofit organization that purchases affordable housing to preserve its long-term affordability. This transaction is the group’s first in Florida, and it brings the number of affordable units owned by POAH to almost 6,500.

“POAH stepped in to preserve this affordable housing resource and to put the properties on a sound physical and financial footing for the long term,” said organization President Amy Anthony. “Hundreds of low-income Florida families and elders might have lost their homes if the properties were sold to the wrong buyer.
Ensuring that these properties are safe, well-managed, and—most importantly—affordable, is at the very heart of POAH’s mission.”

The transaction costs include $27.4 million in acquisition costs, $8.3 million in rehabilitation costs, and $13.5 million in reserves, planning/design work, and other transaction costs.

The $27.4 million in acquisition financing includes new taxable financing from Prudential Mortgage Co. as well as the assumption of $3.6 million of financing provided by Florida Housing Finance Corp. and $1.9 million provided by Miami-Dade County, and $3.4 million of new subordinate debt from the Local Initiatives Support Corp. The Department of Housing and Urban Development also played a role in making the deal happen.

The Miami properties involved are Campbell Arms Apartments, Cutler Glen Apartments, Cutler Manor Apartments, Cutler Meadows Apartments, and New Horizons Apartments. Middletowne Apartments in the Jacksonville area was also purchased.

CTCAC Postpones First Round

2009-02-23T14:51:00.000-08:00

The California Tax Credit Allocation Committee (TCAC) is postponing the due date for the first round of low-income housing tax credits (LIHTCs) this year in the wake of the recent signing of the economic stimulus plan, which makes several changes to the tax credit program.

"In order to fully disclose its direction to prospective 2009 applicants, TCAC is hereby postponing the first-round application due date from April 6, 2009, to a later date," said Executive Director William Pavao in an announcement today. The committee will disclose the new deadline as soon as it establishes the timing for adopting new regulations.

The stimulus plan makes available $2 billion to housing tax credit agencies nationwide to be used for gap financing to help stalled LIHTC projects. The bill also includes a provision to allow agencies to use a portion of their tax credits as grants.

TCAC said it will likely make federal cash resources available to some sponsors with current LIHTC reservations as well as those seeking 2009 credits.

Developers Take on Sacramento

2009-02-19T14:44:00.000-08:00

Affordable housing developers traveled to Sacramento this week for a meeting of the obscure Pooled Money Investment Board, which has frozen state financing for many projects.

The developers, who came from all over the state, wanted the board to understand the impact that stalled bond money was having on the industry, including a potential halt in the construction of 50,071 affordable rental and for-sale homes in 792 developments. It is also estimated that 93,400 jobs would be lost once construction is halted or delayed.

The action came after the board voted to defer bond expenditures from the Pooled Money Investment Account (PMIA) last year. The action affected $3.8 billion in funding for various housing, highway, and other projects across the state. The PMIA provides loans bond-funded projects.

"Affordable home production is unique among state bond-funded activities in that the state's investment leverages millions of dolars of private capital, thereby stimulating the crippled credit markets," said Julie Snyder, policy director for Housing California. "Affordable home production must be a top priority when bond funds are unfrozen. Building homes not only creates jobs and much-needed affordable places to live, but these public-private partnerships also stimulate California's economy in a unique way."

More than 30 representatives from many of the state's leading affordable housing firms spoke at the meeting.

Quote of the Week

2009-02-17T17:25:00.000-08:00

Here's my housing quote from the past week. It comes Grant Whitaker, who just became the CEO and president of Utah Housing Corp., which allocates low-income housing tax credits and other financing for projects.

"This is a critical time to demonstrate leadership in stimulating the housing market. Housing led this economy into a recession and it can also lead the way out of the recession."

Whitaker went on to say that his agency helps make it possible for people to buy a home and that it will be essential to tap into the tight financial markets to advance the group's mission of providing below market-rate financing.

Whitaker assumes the top post at the agency after serving as senior vice president for 25 years.

Obama Signs Stimulus Bill

2009-02-17T16:21:00.000-08:00

The affordable housing industry received several key enhancements in the massive $787 billion stimulus package signed by President Barack Obama today.

The new law provides $2.25 billion in gap funding to help stalled low-income housing tax credit (LIHTCs) projects. The funds will be distributed to housing tax credit allocating agencies based on the federal formula for the HOME program.

The bill also includes a provision to allow allocating agencies to use a portion of housing tax credits as grants instead of credits.

However, a proposal to allow investors to “accelerate” the housing tax credit by claiming 20 percent of the allowable credits in each of the first three years was not included in the final legislation. Many LIHTC program participants had lobbied for this provision, hoping it would be a way to encourage investors into to the stagnant market.

The nation’s public housing was also addressed in the bill. The legislation provides $4 billion for the public housing capital fund, with $3 billion being distributed by the capital fund formula and $1 billion through competitive grants.

There will be $2 billion to fund the Neighborhood Stabilization Program and another $1 billion for the Community Development Block Grant program.

The bill also included $1.5 billion for homelessness prevention and rapid re-housing.
The New Markets Tax Credit program gets $3 billion—$1.5 billion for both 2008 and 2009.

“The passage and signing into law of H.R. 1, the American Recovery and Reinvestment Act, is a critical step forward in what is certain to be a long road to recovery,” said Renee Rooker, president of the National Association of Housing and Redevelopment Officials (NAHRO). “NAHRO is particularly pleased that our nation's housing and community development needs were addressed and made a critical part of a workable strategy to revitalize our economy and strengthen our nation's infrastructure.”

The $4 billion for the public housing capital fund “will allow public housing authorities to begin to mitigate the approximately $32 billion backlog in capital needs,” said Rooker in written statement. “At the same time, we believe these funds will assist in furthering our efforts to integrate green building technologies and reduce energy consumption within our nation's public housing inventory.”

Stay tune for more details.

Cestero Becomes N.Y.C. Commissioner

2009-02-13T16:50:00.000-08:00

Rafael Cestero has been named commissioner of New York City’s Department of Housing Preservation and Development (HPD).

Cestero joins the city from Enterprise Community Partners, where he has been senior vice president and chief program officer overseeing the organization’s national programs related to housing production, income targeting, and quality of life measures. He was previously a deputy commissioner at HPD, managing the office of development from 2004 to 2007.

He is expected to begin his new post March 15. Cestero replaces Shaun Donovan, who recently became secretary of the Department of Housing and Urban Development.

Mayor Michael Bloomberg made the announcement today.

Congress to Vote on Stimulus Package

2009-02-13T16:05:00.000-08:00

Congress is about to vote on a massive $787 billion economic stimulus bill today that affordable housing supporters hope will include them.

Although final details of the compromise bill had to yet to be made clear, it appeared that the bill would include several important provisions for the industry, but not everything that advocates sought.

Early reports indicate that the compromise package will include $2.25 billion to fund HOME, with $2 billion of this going to help stalled low-income housing tax credit (LIHTC) projects.

One report also said that a final bill will likely allow tax credit allocating agencies to receive a portion of their 2009 credits as cash to use to fill financing gaps in projects.

However, it seemed less likely that the Senate’s proposal to allow tax credit investors to claim 20 percent of the allowable credits in the first three years would be included in a final package. We’ll have to see if this and other proposals do get included.

Stay tuned for more information.

Industry Urged to Contact Senators Regarding Cantwell Amendment

2009-02-04T15:30:00.000-08:00

Sen. Maria Cantwell (D-Wash.) today filed an amendment to the Senate economic recovery proposal that would accelerate the amount of low-income housing tax credits (LIHTCs) that could be claimed in the first three years while still retaining the full 10-year credit period. Remaining credits would be taken on a straight-line basis over the last seven years of the credit period. This amendment is an integral part of the comprehensive package of affordable housing provisions that the LIHTC community has recommended as part of the American Recovery and Reinvestment Act of 2009.

The amendment is sponsored by Sens. Cantwell, John Kerry (D-Mass.), Olympia Snowe (R-Maine), Orrin Hatch (R-Utah), Thomas Carper (D-Del.), Ron Wyden (D-Ore.), John Ensign (R-Nev.), Charles Schumer (D-N.Y.), Debbie Stabenow (D-Mich.), Jeff Bingaman (D-N.M.), Benjamin Cardin (D-Md.), and Bill Nelson (D-Fla.).

Leaders in the affordable housing industry believe that the adoption of the Cantwell amendment is critical for the LIHTC program and urge the LIHTC community to call or e-mail their senators today who are not currently sponsors and ask them to support this amendment. Action on the Cantwell LIHTC amendment is expected later this week.

You should contact your senators through www.senate.gov. Contact information for each senator, which includes some phone numbers, can be found there. You may need to fill in an online form for the person you are contacting or simply “cut and paste” the message below:

Over the past 22 years, the Low-Income Housing Tax Credit program has helped to create more than 2 million affordable apartments for lower income people and has generated millions of jobs. As a member of the affordable housing industry, I urge you to continue assisting the program by voting to adopt the Cantwell amendment to accelerate the Low Income Housing Tax Credit as part of the Senate’s tax stimulus bill when it comes to the Senate floor.

Keep your message short – to 1,500 characters or less.

HUD Leadership Begins to Take Shape

2009-02-04T15:26:00.000-08:00

President Barack Obama this week said he will nominate Ron Sims, county executive of King County, Wash., to be the deputy secretary of the Department of Housing and Urban Development (HUD).

The nomination comes on the heels of Shaun Donovan’s confirmation as HUD secretary.
As deputy secretary, Sims will manage the departments day-to-day operations, a $39 billion operating budget, and the agency’s 8,500 employees.

His appointment requires confirmation by the Senate.

As county executive, Sims, 60, oversees the 13th largest county in the nation. He has held the post for 12 years, stepping into the office in 1996 to fill a vacancy left by Gary Locke when he became governor. Sims then won election the following year and was easily re-elected in 2001 and 2005. He has lost in his bids for a U.S. Senate seat and for governor.

Sims confirmed Monday that he will be leaving his post to join HUD.

“He is the perfect person to help HUD return to national leadership on metropolitan planning,” said Donovan in a statement. “Together, we will work with President Obama to ensure HUD is doing all it can to help the nation’s communities recover from today’s economic realities and to better position them for the future.”

If confirmed, Sims will bring his experience in running a large urban government and metropolitan planning to HUD. He is a board member for Reconnecting America Center for Transit-Oriented Development and on the board of King County’s Committee to End Homelessness.

Habitat Founder Dies

2009-02-03T14:14:00.001-08:00

Habitat for Humanity founder Millard Fuller died Tuesday. He was 74.

He died after a brief illness, according to a statement posted on the Web site of The Fuller Center for Housing, the organization that he had recently been heading. Fuller had suffered from chest congestion for several weeks, according to news reports.

Fuller will be buried at Koinonia Farm in Americus, Ga., at 11 a.m. Feb. 4. The funeral is open to the public. The family is also planning a memorial service for later this month.

Fuller and his wife, Linda, led Habitat for Humanity from its founding in 1976 until 2005. The group has helped build more than 300,000 houses around the world. Homeowners were expected to help build their houses to help defray the costs.

The organization and Fuller parted ways in 2005 amid a dispute and allegations of inappropriate behavior toward a female employee. Fuller denied the charges, and after losing control of Habitat, he and wife started The Fuller Center for Housing to continue his ministry of building affordable housing.

Calogero Becomes CEO of N.Y. Housing Conference

2009-01-30T12:51:00.000-08:00

Industry veteran Judith Calogero has been named CEO of the New York Housing Conference (NYHC).

Her appointment fills the leadership vacancy left in 2007 by the passing of Clara Fox, the organization's founder.

Calogero is a former commissioner of the New York State Division of Housing and Community Renewal. Most recently, she served as the Northeast director of RBC Capital Markets, Tax Credit Equity Group, supervising the origination of affordable housing, historic, and solar tax credit investments for the bank.

The NYHC is a broad-based coalition of nonprofit and for-profit developers, owners, managers, and funders of affordable housing. The group joined the National Housing Conference as its first regional affiliate in 1976.

Enterprise's Donahue Announces Retirement

2009-01-21T13:21:00.000-08:00

Enterprise Community Investment, Inc., today announced the planned retirement of President and CEO Jeffrey H. Donahue, effective April 15.

Charles Werhane, vice chairman and chief operating officer, has been named by the board as Donahue's successor.

Prior to becoming CEO in 2003, Donahue, 62, served on the firm's board for eight years while working as vice president and chief financial officer at The Rouse Co.

Enterprise manages one of the largest low-income housing tax credit portfolios in the nation, with 1,600 projects and $7 billion in equity. “During Mr. Donahue’s tenure as CEO, Enterprise Community Investment’s organizational strength has expanded substantially and, in financial terms, its revenues, net worth and assets under management have all increased by 75 percent or more," said Chairman Jaime Yordan.

Werhane, 54, is credited with starting Enterprise's New Markets Tax Credit program. He has also had oversight of the company's debt and equity production lines since 2006.

Brian Montgomery is Running HUD!

2009-01-21T13:14:00.000-08:00

A familiar figure is running Department of Housing and Urban Development (HUD) while we wait for the Senate to confirm President Barack Obama's nominee to lead the agency, according to a recent report on FoxNews:

"New York City housing department chief Shaun Donovan's wait for confirmation as Housing and Urban Development secretary puts Federal Housing Commissioner Brian D. Montgomery in charge at HUD. Montgomery joined the agency in 2005 after serving in the White House under the Bush administration."

Montgomery came to HUD with almost no housing experience. But Montgomery surprised industry insiders with his quick learning curve and his willingness to listen. Some housing advocates now describe Montgomery as an "old friend."

NMTC Competition Kicks Off

2009-01-16T16:50:00.000-08:00

The Treasury Department announced today the opening of the seventh round of the New Markets Tax Credit competition.

This year’s competition will include an emphasis on placing investments in underserved rural communities, according to the Community Development Financial Institutions Fund, which administers the program. The application deadline is April 8.

There will be $3.5 billion in tax credit authority available in the round.
For more information, visit www.cdfifund.gov.