Key financing has been arranged for a 178-unit affordable housing community in St. Paul, Minnesota.
Merchants Capital announced that it is providing more than $77 million for the community that’s known as Soul. The project—owned and developed by the key partner on the project, Schafer Richardson—is a crucial redevelopment effort for the city and an important factor in its commitment to expanding access to affordable housing within the city limits.
Soul will be built on a redevelopment site of a city infill location, with all construction completed as 100% union labor and union construction. An environmental cleanup of the area will be part of the effort. The mixed-use property will be built to earn an Enterprise Green Communities certification and all necessary standards to comply with the city’s sustainable building policy. Additionally, the development will feature a rooftop solar array to support lower electricity rates, according to project partners.
Soul will feature one-, two-, three-, and four-bedroom units. Twenty-three three-bedroom and 12 four-bedroom apartments will be restricted at 30% of the area median income (AMI). The remaining 143 units comprise one-, two-, and three-bedroom floor plans and will be restricted to individuals earning no more than 60% of the AMI. The 35 deeply affordable units will remain affordable at 30% of the AMI for 30 years, and all units within the property will remain at 60% of the AMI or lower for 40 years.
Merchants Capital secured a $33 million Merchants Bank of Indiana (MBI) construction loan, a $16.6 million MBI equity bridge loan, and a $27.45 million Freddie Mac Tax-Exempt Loan. RBC Capital Markets served as the equity provider for the project.
Others involved in the project include the Greater Minnesota Housing Fund, AFL-CIO Housing Investment Trust, and Ramsey County. The city of St. Paul also contributed to the project through an allocation of American Rescue Plan Act funds and grants to support gap financing.
Kaas Wilson Architects is the project architect, and Weis Builders is serving as the project’s general contractor.