TAX CREDIT ACQUISITION DEVELOPMENT CASE STUDY
Currently Under Rehabilitation
Class of Project: Tax Credit Acquisition
Resident Profile: Family Designation
Subsidy: Project Based Section 8 Contract, 9% LIHTC
Financing: LIHPRA Project With Freddie Mac Moderate Rehab Loan From PNC Bank
State Agency: Nebraska Investment Finance Authority (NIFA)
Limited Partner(s): Boston Financial Investment Management
Joint Venture Partner(s): The Wischamper Companies, Inc (TWC)
Canterbury Village and Yorkshire Manor were built in 1971 as sister affordable housing projects by a Nebraska developer. Canterbury Village is a 96-unit multifamily property located in South Sioux City consisting of a mix of 1-, 2- and 3-bedroom units, 88 of which benefit from a Section 8 project-based subsidy. Yorkshire Manor is an 84-unit multifamily property located in Fremont consisting of a mix of 1-, 2- and 3-bedroom units, all 84 of which benefit from a Section 8 project-based subsidy. Canterbury Village was originally financed by HUD under Section 221(d)(3) of the National Housing Act. Yorkshire Manor was originally financed by HUD under Section 236 of the National Housing Act. The original developer later refinanced both properties utilizing subordinate 241(f) LIHPRHA loans from HUD.
Both properties provide important and valuable affordable housing for their respective communities. Upon acquisition each property was nearly 40 years old with substantial deferred capital needs. In addition, the Section 8 project-based contract at each property was nearly expired, thereby threatening the affordability of the property. The preservation need was great at both locations.
Utilizing an allocation of 9% LIHTCs from the Nebraska Investment Finance Authority’s Preservation Set-Aside, the affordability of the properties was preserved for another 45 years. In addition, the Section 8 project-based subsidy at each property was extended for a period of 20 years. Boston Financial Investment Management, a syndicator of Low Income Housing Tax Credits, is the investor limited partner in both developments. The seller’s primary and subordinate financing on both properties was paid off at closing, and new Freddie Mac Moderate Rehab financing was put in place at both properties with PNC Bank, NA.
Both properties are currently undergoing substantial rehabilitation, a process expected to last 12 months. Over $4.6MM in renovations is taking place at Canterbury Village, and over $4.5MM in renovations is talking place at Yorkshire Manor. The renovation at both properties includes hazardous materials remediation, life safety upgrades, renovations of kitchens and baths, roof replacements, window replacements, new paint and flooring, HVAC replacements, security upgrades and various site improvements. A new community building housing a multipurpose room for tenants, management offices and on-site storage is being constructed at each property as well.
Preservation Management, Inc. (PMI), the management company, administers a Supportive Services program at both properties, helping to connect residents to social service resources in their respective communities. PMI also provides on-site security at both properties, which helps the residents live in safe, clean and secure communities.