Homestead Capital, a Portland-Ore.-based nonprofit syndicator of low-income housing tax credits, will become part of the National Equity Fund, Inc. (NEF).
Homestead officials sought the merger to ensure its sustainability as a Northwest-focused equity provider.
The state of the market makes this a timely and beneficial move, says President Tobias Washington Jr., who hopes the deal will close by the end of the third quarter.
Established in 1993, Homestead has raised more than $475 million to help develop more than 102 projects.
At its peak, it had a staff of about 20 to 25, says Washington. The team was then resized to about 17 in 2008. With the merger, five members of the current management team are expected to remain.
Washington joined Homestead in 2008, shortly after the organization came under fire for the compensation and expenses paid to its former leader Deborah Saweuyer-Parks. She received about $469,000 in salary and benefits in 2004, according to an Oregon Department of Justice report. The group was criticized but avoided penalties after making several changes to its practices.
Still, the tumult hurt the organization’s efforts, and the downturn in the LIHTC market added to Homestead’s troubles.
NEF, a prominent national nonprofit tax credit syndicator, will give the regional fund new support to preserve the Homestead brand, according to Washington.
“The good news is we have a solid portfolio at Homestead, and it’s performing well,” says Washington, who will resign at the close of the merger.
For NEF, the merger increases the organization’s presence in the Northwest.