Mortgage banking company Merchants Capital has established a low-income housing tax credit syndication platform.
Officials say the move reflects the company’s transformation into a full-service financing provider for affordable housing.
“We are doubling down our commitment to affordable housing,” said Michael R. Dury, Merchants Capital president and CEO. “Leveraging the bank’s balance sheet, along with Merchants Capital’s agency permanent debt financing through the Department of Housing and Urban Development, Fannie Mae, and Freddie Mac, the equity platform is a true synergy for the business. Merchants Bank has grown to nearly $10 billion in assets, which allows us to buy and hold equity investments and provide upper-tier bridge financing to our funds.”
Julie Sharp will lead the platform as senior vice president of tax credit equity syndications. Sharp joined Merchants Capital from one of the nation’s largest tax credit equity syndicators, where she was involved in raising capital and structuring and closing upper-tier investments valued at more than $1 billion through private placements, multi-investor funds, and secondary activity.
“This is an exciting time at Merchants Capital. The future of the tax credit equity syndication industry requires a fully integrated platform, and no one can execute that better than Merchants Capital,” Sharp said.
The tax credit syndication platform has closed its first fund, a unique project that allowed Merchants Capital to partner with Merchants Bank and four other community banks to provide $22 million in equity to support affordable housing in the state of Indiana. The fund’s investment supported seven affordable housing projects in Indianapolis, Gary, and South Bend, totaling more than 1,100 units. Merchants Capital also completed the debt financing for all seven properties.
“Closing our first fund was a huge milestone and proof of concept. This collaboration aligned the interests of the property owners, syndicator, investors, and debt servicers for a long-term partnership,” said Sharp.
