Centerline Capital Group has become the first multifamily lender to achieve fully delegated status under Freddie Mac’s Delegated Underwriting for Targeted Affordable Housing program.
By going to fully delegated status, Centerline says it can shave about 30 days off the time it takes to process a typical affordable housing transaction. That would reduce the processing time from between 90 and 120 days to between 60 and 90 days.
Quicker execution is especially important in the lowincome housing tax credit world. “The allocation of tax credits and bonds are precious resources and in many places, there are ‘use it or lose it’ clauses,” said Rachel Diller, a director in the Commercial Real Estate Group of Centerline Capital Group. “For affordable housing developers, certainty is key.”
The quicker processing time may be even more critical since conduit lenders began scaling back their originations. “In today’s market, where Freddie Mac is inundated with loan requests due to the cooling off of the CMBS market, the transaction could be a much longer process,” said Diller.
Freddie Mac’s Delegated Underwriting program for affordable housing allows approved lenders to fully underwrite loans, expediting the processing time in exchange for sharing risk. But lenders must graduate to fully designated status after completing an initial trial period as a delegated underwriter.
Centerline has been part of the program since May 2005, soon after it began. Since entering the program, the company has closed 37 transactions, totaling more than $285 million in financing. The company currently has eight deals in its pipeline that are expected to close by year-end.
The first financing package that Centerline delivered under its fully delegated status was for the purchase and renovation of Villa Nueva Apartments in San Diego, and was made to affordable housing developer Steadfast Residential Properties. The company arranged a $37.5 million taxexempt bond financing package for Steadfast, and also served as a tax credit equity provider to complete a $63.7 million financing package for the 398-unit affordable housing complex.
Public Housing Goes Green
Public housing residents will soon have some of the greenest apartments in Denver.
The Denver Housing Authority (DHA) launched a citywide energy-efficiency program that will save approximately $3.8 million in annual energy costs, or an average 25 percent of the authority?s annual energy usage.
The effort will include a pilot geothermal heating and cooling system at the Hirschfield Tower high-rise development. It will be the largest geothermal system in the Denver region.
The initiative will also include improving heating, ventilation, and air conditioning systems, installing new boilers and furnaces, and replacing appliances with high-efficiency models.
The DHA is initiating the program with a $36 million contract with Honeywell. The contract is structured so that Honeywell will make the improvements to the properties and then DHA will use the savings to pay for the cost of the improvements.
About 3,700 public housing units will be involved.
Saints Come Marching Home
In a city known for its music, it?s only appropriate that one of the key developments being built is for musicians.
The Musicians? Village, conceived by musicians Harry Connick Jr. and Branford Marsalis, will include 72 singlefamily homes constructed by the New Orleans Area Habitat for Humanity and will house displaced musicians and others.
It?s one of the highest-profile projects taking place in Hurricane Katrina-damaged New Orleans. Forty-three homes have been completed, with the others under construction.
The New Orleans Area Habitat for Humanity is also building five duplexes for seniors on the site. One duplex is completed.
A groundbreaking was held in September for the Ellis Marsalis Center for Music, which will include a performing arts theater as well as recording and teaching space. It is the centerpiece of the Musicians? Village in New Orleans? Ninth Ward.
In addition to the village project, about 80 homes also are under construction by the organization.
HUD?s $300,000 Paintings
A $300,000 contract has been awarded to an artist to paint a portrait of Department of Housing and Urban Development (HUD) Secretary Alphonso Jackson and four other recent HUD chiefs.
The push to get the paintings is an effort to catch up, according to HUD spokesman Jerry Brown. The other secretaries who will be captured in official portraits are Mel Martinez, Andrew Cuomo, Henry Cisneros, and Jack Kemp.
The last secretary to have a painting done was Samuel Pierce, who served during the Reagan administration.
