Merchants Capital has announced the closing of two tax credit funds totaling more than $233.4 million in equity.
Merchants Capital Tax Credit Equity Fund V (Merchants Fund V) represents the company’s first national multi-investor fund with a total capital raise of $172.5 million from 16 institutional investors, including banks and insurance companies. Merchants Fund V will infuse equity into 18 affordable housing properties that will create or preserve more than 1,958 affordable homes in 11 states.
The company further announced the closing of Merchants Capital SW Tax Credit Equity Fund III (Merchants Fund III), a $60.9 million proprietary fund with a Fortune 500 company that will provide equity capital into eight affordable housing projects structured with low-income housing and historic rehabilitation tax credits in three states. The investment in Merchants Fund III will create 593 affordable homes in three states and revitalize historically significant housing properties in San Antonio and Kansas City, Missouri.
“The successful closing of Merchants Funds V and III, with more than $233.4 million in capital raised from 17 investors, is a milestone achievement for our affordable housing equity platform,” said Julie Sharp, senior vice president of tax credit equity at Merchants Capital. “With more than $22 billion in capital provided to multifamily housing since inception, our company has emerged as a leading debt and equity provider for affordable housing across the United States.”
Merchants Fund V was designed to make a large social impact. The fund is structured with an innovative and first-of-its-kind social impact reserve that is projected to deploy nearly $500,000 in capital to support tenants over the life of the fund. The developer sponsors include some of the largest affordable housing owner/operators in the nation.
“We are grateful to our developer and investor partners for their partnership,” said Linda Hill, senior vice president of tax credit equity at Merchants Capital. “The successful closing of Merchants Funds V and III is a testament to the strength of our relationships and innovative platform we have built.”
The 25 properties included in Merchants Funds III and V are in California, Indiana, Kentucky, Michigan, Minnesota, Missouri, North Carolina, Ohio, South Carolina, Tennessee, Texas, and Wisconsin.
