2020 Texas Affordable Housing Magazine

UNLOCKING THE POSSIBLITIES

2020 Edition • Issue 11

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investments, our team of experienced professionals

Asset Management

■ Historic Tax Credits

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■ Direct

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100 in Texas; 1,006 Nationally

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TA B L E O F

Contents GENERAL

11

F E AT U R E S

A Message from Leadership

D A N K I E R C E , I M M E D I AT E PA S T PRESIDENT

The Global Pandemic & Economic Crisis: The Road to Economic Recovery is Paved with Affordable Housing V I C T O R I A W I L S O N , TA A H P P O L I C Y & R E G U L A T O R Y M A N A G E R

12

Contributors

25

Affordable Housing Community Success Stories

13

TAAHP Leadership

60

Wow Factors in Affordable Housing Resident Services

15

Legislative Update

68

Washington Wire: Community Development Tax Incentives Poised to Spur the Economic Recovery

58

Knowledge is Power

59

Scholarship Awards

66

TAAHP Past Presidents

75

TDHCA Meeting Schedule

78

TAAHP Supporters

ARTICLES & ADS

BOARD OF DIRECTORS

A MESSAGE FROM THE PRESIDENT

SPOTLIGHT

F E AT U R E

M I C H A E L J . N O V O G R A D A C , C PA , N O V O G R A D A C & C O M PA N Y, L L P

RESEARCH & STUDIES

TA A H P S C H O L A R S H I P COMMITTEE

THANK YOU

2020-2021

THANK YOU

60 10

16

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68

16

25

A MESSAGE FROM THE 2019-2020 PRESIDENT

P

rior to the COVID-19 have one-on-one discussions to promote products and services. pandemic, TAAHP had ended a very successful year I want to express my appreciation for in 2019 filled with high optimism for 2020 the work of the TAAHP team and their that included plans for new affordable responsiveness in this uncharted pandemic housing programming, new advocacy territory. All trade associations are making efforts, and new networking opportunities. adjustments, but our team has been While we have accomplished much of this, exceptional. Because Roger and his team it was not in the way we had anticipated. had already been prepared for remote work, Our world has unexpectedly changed, but TAAHP’s efforts have gone unimpeded. Of our optimism for progress has not. When special note, much of TAAHP’s successful we first recognized the impact of COVID-19, response has been the due to the hard work we immediately worked to adjust our plans, and dedication of Communications Director, TAAHP Immediate Past President our organization, and our outlook to meet Naomi Bludworth. She deserves recognition the uncertainties and challenges before and appreciation for immediately providing us. From the onset of the crisis, TAAHP has understood that the the capacity to convert our education and advocacy events into demand for quality affordable housing was about to explode in great virtual achievements. I would also like to thank Kristi light of the millions of lost jobs and critical income for already Sutterfield and the conference and education committees who did a tremendous amount of work pivoting from a physical strained family budgets. We knew that affordable housing was conference to a virtual one. In addition, I would like to thank all about to reach a level of attention not previously seen nationally our sponsors who demonstrated an unwavering commitment to or globally.

TAAHP and stuck with us through this new format. Without your TAAHP’s mission of providing needed education had to continue sponsorship, we would not have the funding needed to support unabated. So far in 2020, TAAHP has successfully held a variety the organization. of virtual educational events, not all of which were planned to As an industry, our outlook on making progress in affordable be in that format. From Demystifying Private Activity Bonds to housing has only become more pertinent. Given today’s Average Income and QAP Insights, TAAHP immediately pivoted extraordinary national and local attention on affordable housing, to continue providing critical education for affordable housing our work has been immediately transformed from “important” to providers, all in virtual events. The largest change, however, was “essential.” The demand for the work you provide as members of in creating TAAHP’s first virtual Texas Housing Conference. The our industry has grown exponentially over the last few months of Conference included a multitude of issues and topics that covered the pandemic outbreak. As an industry, we have always made it COVID-19’s impact on affordable housing financing mechanisms, clear that from its impact on the economy, job creation, education markets, and legislative and regulatory changes. The conference access, and health impacts, affordable housing for working also included a ground-breaking policy discussion on the role families will be one of the most critical factors in achieving this of housing in addressing the digital divide in public education recovery. and the critical need to address racial inequality. Our team also

Dan Kierce

unveiled its first virtual exhibit hall, complete with the ability to

Thank you for your work on behalf of Texas families.

Membership Has its Benefits GIVE BACK TO THE ORGANIZATION THAT SUPPORTS YOUR BUSINESS! Join online at www.taahp.org or call (512) 476-9901 today!

Te x a s A f f o r d a b l e H o u s i n g M a g a z i n e

11

C O N T R I B U T O R S

&

C R E D I T S

CONTRIBUTORS

CREDITS

TAAHP Staff Victoria Wilson, Policy & Regulatory Manager

Published By

T H E G L O B A L PA N D E M I C & T H E E C O N O M I C CRISIS: THE ROAD TO ECONOMIC R E C O V E R Y I S PA V E D W I T H A F F O R D A B L E HOUSING

Michael J. Novogradac, CPA, Novogradac & Company, LLP

W A S H I N GTO N W I R E : C O M M U N I T Y D E V E L O P M E N T TA X I N C E N T I V E S P O I S E D TO SPUR THE ECONOMIC RECOVERY

ARX Advantage Blazer Building DMA Development Companies New Hope Housing Saigebrook Development

S P O T L I G H T: A F F O R D A B L E H O U S I N G COMMUNITY SUCCESS STORIES

DMA Companies Portfolio Resident Services

W O W FA C TO R S I N A F F O R DA B L E H O U S I N G RESIDENT SERVICES

T E X A S A F F I L I AT I O N O F A F F O R D A B L E HOUSING PROVIDERS

2401 E 6th Street, Ste 3037, PMB 153 Austin, TX 78702 (512) 476-9901; www.taahp.org

Publisher

ROGER ARRIAGA, EXECUTIVE DIRECTOR

roger@taahp.org

Advertising, Sponsorship Sales

Art Director / Design / Editor

ksutterfield@taahp.org

naomi@taahp.org

K R I ST I S U T T E R F I E L D, C O N F E R E N C E DIRECTOR

N A O M I B L U D W O R T H , C O M M U N I C AT I O N S DIRECTOR

Contributing Editor

V I C TO R I A W I L S O N , P O L I C Y & R E G U L ATO R Y MANAGER

victoria@taahp.org

On the Cover: Lucero - Photo Courtesy of Eureka Multifamily Group

Although every attempt is made to be as comprehensive and accurate as possible, the Texas Affiliation of Affordable Housing Providers (TAAHP) and its affiliates are not responsible for any misprints, errors, omissions, deletions, or the accuracy of the information in the publication. TAAHP and its affiliates do not accept responsibility for any loss, injury or inconvenience sustained by anyone using this publication. Information may have changed since print date.

Copyright© 2020 by the Texas Affiliation of Affordable Housing Providers. All rights reserved. No part of this publication may be reproduced or transmitted in any form, by any means, electronic, mechanical, photocopying or otherwise without the written permission of the Publisher. The Texas Housing Conference™ is a protected trademark.

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Te x a s A f f o r d a b l e H o u s i n g M a g a z i n e

Dominium, Inc.. . . . . . . . . . . . . . . . . . . . 83 Enterprise/Bellwether Enterprise . . . . . 45 FDI Property Management Group, Inc.. 41 Federal Home Loan Bank of Dallas. . . . 77 Fox Energy Specialists. . . . . . . . . . . . . . . 73 Galaxy Builders, LTD. . . . . . . . . . . . . . . . 77 Goodman Manufacturing. . . . . . . . . . . . 46 Gulf Loss Consultants. . . . . . . . . . . . . . . 47 Herman & Kittle Properties, Inc. . . . . . . 64 Highland Commercial Mortgage, LLC. . 84 Highridge Costa . . . . . . . . . . . . . . . . . . . 82 Housing Lab by Betco. . . . . . . . . . . . . . . 74 Hudson Housing Capital . . . . . . . . . . . . 23 ITEX Group. . . . . . . . . . . . . . . . . . . . . . . . 84 J4 Development. . . . . . . . . . . . . . . . . . . 54 JLL Capital Markets. . . . . . . . . . . . . . . . . 80 JP Morgan Chase Bank. . . . . . . . . . . . . . 38 KeyBank Real Estate Capital. . . . . . . . . . 82 Locke Lord LLP. . . . . . . . . . . . . . . . . . . . . . 4 M&T Realty Capital Corporation. . . . . . . 29 MacRostie Historic Advisors, LLC. . . . . . 80 National Church Residences . . . . . . . . . 14 National Equity Fund . . . . . . . . . . . . . . . 47 Norris George & Ostrow PLLC. . . . . . . . . 63 Novogradac & Company, LLP. . . . . . . . . 73 NRP Construction Services. . . . . . . . . . . . 8 Palladium USA International, Inc.. . . . . 42

Pavilion Construction, LLC . . . . . . . . . . . 76 Phase Engineering, Inc.. . . . . . . . . . . . . 32 PNC Real Estate. . . . . . . . . . . . . . . . . . . . 80 Portfolio Resident Services. . . . . . . . . . . IFC R4 Capital LLC . . . . . . . . . . . . . . . . . . . . . . 5 Rainbow Housing Assistance Corp. . . . 19 RBC Community Investments. . . . . . . . . 7 Red Capital Group. . . . . . . . . . . . . . . . . . 32 Red Stone Equiity Partners. . . . . . . . . . . 26 Regions Affordable Housing. . . . . . . . . 67 Rinnai America Corporation. . . . . . . . . . 14 RubinBrown, LLC. . . . . . . . . . . . . . . . . . . 36 Seldin Company. . . . . . . . . . . . . . . . . . . . 8 Shacklford Bowen McKinley & Norton. . 9 Sonoma Housing Advisors, LLC. . . . . . . 37 Stifel. . . . . . . . . . . . . . . . . . . . . . . . . . . . . 53 StoveTop FireStop. . . . . . . . . . . . . . . . . . 50 TALHFA. . . . . . . . . . . . . . . . . . . . . . . . . . . 76 Texas Department of Housing & Community Affairs. . . . . . . . . . . . . . 75 Texas State Affordable Housing Corp.. . 84 The Michaels Organization. . . . . . . . . . . 59 Tidwell Group. . . . . . . . . . . . . . . . . . . . . . 41 Ward, Getz & Associates. . . . . . . . . . . . . 29 Wells Fargo . . . . . . . . . . . . . . . . . . . . . . . 64 Wilhoit Properties. . . . . . . . . . . . . . . . . . . 6 Wilmington Trust. . . . . . . . . . . . . . . . . . . 36

T A A H P

L E A D E R S H I P

TAAHP Board of Directors

2 0 2 0 - 2 0 2 1

Top Row, Left to Right: Janine Sisak, President; Dan Kierce, Immediate Past President; Chris Akbari, President-Elect Second Row, Left to Right: Jean Latsha, First VP; Valerie Williams, Second VP; David Saling, Treasurer; Nathan Kelley, Secretary Bottom, Left to Right: Debra Guerrero, K. Nicole Asarch, Terri Anderson, Jen Brewerton, Ellie MC Fanning, Meghan Garza, Darrell Jack, Audrey Martin, Mark Mayfield, Lora Myrick, Stephanie Naquin, Hector Zuniga

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TA A H P L E G I S L AT I V E U P D AT E A MESSAGE FROM THE PRESIDENT

D

espite a typically quiet start, 2020 took an unexpected turn in March when the world changed. Our industry, impacted overnight, was forced to quickly adapt to the “new normal”. We have all marched up a steep learning curve this year as the Covid-19 pandemic and the associated economic fallout continue to offer unprecedented challenges.

developments can proceed—whether those new areas are high opportunity areas where community opposition exists, or whether those areas are already served by tax credit developments but simply need more affordable housing to meet demand.

In the year ahead, the Government Affairs committee will also continue to support federal efforts to promote the Affordable Housing Credit Improvement Act of 2019 The 86th session saw the passing of H.B. (AHCIA), which was reintroduced in both the 1973, sponsored by Representative Senate (S. 1703) and the House (H.R. 3077) Angie Chen Button, that affords on June 4, 2020. The identical bills contain state representatives the option more than two dozen provisions targeted at of submitting written input on improving the Housing Tax Credit program, a 9 percent housing tax credit including enacting a minimum 4 percent application. Under this bill, if a Housing Credit rate, increasing the annual state representative opts out of the Housing Credit allocation by 50 percent over 2020-2021 TAAHP President process, an application can still receive a two-year period, and most significantly the full points if the local jurisdiction for Texas, prohibiting state agencies from supports the application. Results from the 2020 round indicate establishing scoring criteria based on local and community that this bill did have a positive impact on the 9 percent housing input. If successful, our planned state level legislative agenda tax credit program. Whereas in previous years, 100 percent would radically change, because we would be able to reallocate of the full applications provided a support letter from the resources to focus on other provisions of Section 2306, as well as state representative to be competitive, 40 percent of the full on past legislative efforts to bring clarity and consistency to the applications in 2020 did not receive any written input from the property tax appraisal process. state representative, but still received the full points because they Looking forward, we will also continue to work closely with had local city support.

TDHCA’s Executive Director Bobby Wilkinson, formerly deputy

Janine Sisak

These results are encouraging, but there is more work to be done. The three forms of community input that are codified in Section 2306 of the Texas Government Code—state representative letter, resolution of support from local jurisdictions, and letters from qualified neighborhood organizations—together represent 33 out of the total possible 180 points. Of the 10 remaining states in the U.S. that require community input as part of their tax credit programs, Texas is the only state that attributes such a high score to these factors—despite the fact that housing tax credit developments are of similar quality but maintained and operated at a higher standard than their market-rate peers.

And so, TAAHP’s legislative efforts in the 87th legislative session will continue to focus on educating our state legislators on the importance of increasing the supply of affordable housing in all communities, as a positive contributor to the economic recovery.

It will be a challenge for us to be successful in introducing any new legislation unless we take a simple approach to increase supply by reducing regulatory barriers. To this end, we will explore deletions and/or small tweaks within the language of Section 2306, the program’s enabling legislation, to mitigate some of the harsher provisions of our codified qualified allocation plan. The goal is to increase the geographic areas where tax credit

budget director for Governor Abbot, who joined TDHCA in the fall of 2019. TAAHP’s executive team and key committee chairs held bi-weekly phone calls with Mr. Wilkinson so that both TAAHP and TDHCA could share the industry effects of the pandemic and collaborate on possible solutions. I appreciate Mr. Wilkinson’s willingness to meet with our team regularly and listen to our concerns. One outcome from these meetings is TDHCA’s grant of an automatic place in service extension for all 2018 9 percent housing tax credit developments, which was approved by the TDHCA board on September 3rd. We will continue to work with TDHCA to grant similar relief from TDHCA’s policies and procedures as we all continue to work together through this unchartered territory.

As the incoming TAAHP president, I am humbled by the prospect of leading this organization during these challenging times.

With an upcoming election and ongoing civic unrest, uncertainty will continue, but in uncertain times, we must work together as an industry, for the good of the industry, and for the good of the people we house, especially in light of the growing economic and racial inequities in our country. I look forward to working beside you to carry our mission forward and continually improve on the value we bring to the State of Texas.

Te x a s A f f o r d a b l e H o u s i n g M a g a z i n e

15

GLOBAL PANDEMIC &

THE ROAD TO ECONOMIC

AFFORDABL

By Victoria Wilson, TAAHP Policy & Regulatory Manager

C

OVID-19 has single-handedly sent the United States into a tailspin of illness, death, and job loss—and it is not over yet. At a national level, there are over six million confirmed cases of COVID-19, and Texas hasn’t been spared: over 600,000 people have been diagnosed in the state, 13,000 of which have proven fatal to date. While the end is not quite in sight, we do know that we will get through this together; and affordable housing has a crucial role to play, now and in the future.

Who has been most affected?

The pandemic has impacted everyone, but not equally.

Senior, low-income, minority populations are most vulnerable to its effects. While 60 percent of the population of the United States identifies as non-Hispanic white, this group represents 41 percent of COVID-19 related deaths. Conversely, 18 percent of the US population is Hispanic, yet represents 31 percent of deaths. Medicare billing records show that income can also be a strong predictor of a person’s chances of contracting the virus. People on Medicare who also qualify for Medicaid are four times more likely to have been infected or hospitalized than those on Medicare alone.

16

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Many people have been able to work from home, but those considered “essential” or “frontline” workers haven’t had that opportunity. This group includes grocery, healthcare, childcare, public transit, trucking and warehouse, and cleaning service workers—occupations which are disproportionately held by women, people of color, immigrants, and people over 50.

Despite carrying out the functions considered necessary for communities to receive basic goods and services, over one third of workers in many of these frontline industries live in low-income households.

Further, ten percent of these workers are uninsured, and over a third have a child at home. And these numbers only consider those who still have jobs. Frontline workers and their families are at risk every day to serve the population at large, and yet are disproportionately burdened on several fronts.

In large part, the disparities described above can be captured by geography: those living in impoverished and racially and economically segregated areas are most likely to experience the adverse effects of COVID-19. Geography and housing are inextri-

THE ECONOMIC CRISIS

RECOVERY IS PAVED WITH

LE HOUSING cably linked; and housing is an important part of the quality-of-life equation. Many families will make sure they can cover housing costs first, foregoing medical and, sometimes, even food expenses. For this reason, affordable housing is necessary to provide stability to those fulfilling essential job functions. Lower housing expenses provide peace of mind to those trying to get back on their feet and reduce the overall cost burden on families so that they can prioritize their health and other necessities.

“The pandemic has illuminated the wealth gap and the most vulnerable have been those who need affordable housing options. The pandemic has simply illustrated the need to address housing and other basic needs in a country that is increasingly not meeting the basic needs of its citizens,” says Toni Jackson, former TAAHP board president and principal at The Banks Law Firm.

Affordable housing can help stabilize families and the economy Stabilizing the economy is a top priority for policy makers and affordable housing can play a critical role in this endeavor. As the unemployed look for work,

Low Income Housing Tax Credit (LIHTC) properties offer reduced rent and supportive services, creating a stable environment for families. Additionally, as new affordable housing developments are built, much needed jobs are created in many sectors affected by the pandemic such as construction, landscaping, job-site cleanup, food and janitorial services.

Unemployment has nearly tripled in Texas as businesses continue to struggle

Pandemic-related business closures and uncertainty have turned what started as a health crisis into an economic one as well. In a matter of a few months, Texas’ unemployment rate increased from 3.8 percent in January 2020 to 6.8 percent as of August 2020.

The threat of community spread of COVID-19 has kept businesses from reopening safely while many others are implementing hiring freezes as they navigate this period of economic uncertainty. These circumstances have resulted in a large, and growing, vulnerable sector of the population, many of whom are newly eligible for income-based affordable housing.

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Affordable housing matters to the backbone of our local economies providing housing for health care providers, teachers, mechanics, hospitality workers, first responders and others.

Photo Credit: Shutterstock

Meanwhile, government measures such as expanded unemployment benefits and eviction moratoria have attempted to stave off homelessness and stabilize families. But, while expanded unemployment benefits are credited with the relative stability we have seen thus far, these expired on September 5th, possibly leaving many without the necessary resources to pay rent and other necessities.

Affordable housing has long played an important role in helping families get back on their feet. Income-based rent reduces the cost burden of housing, which may otherwise keep family members from seeking important medical care. But the benefits of affordable housing don’t stop there. Supportive services offered at LIHTC communities go a long way to educate residents and provide resources to ensure their success.

Eviction moratoria, although well-intentioned, also fall short of being an adequate long-term solution for renters and landlords. Property owners are still required to make their mortgage payments while maintaining properties to adequate safety standards and providing critical supportive services. Meanwhile, renters accumulate thousands of dollars in back-rent which will be due at the close of the moratorium period.

Justin Walker, director of business development at Rainbow Housing, says “residents with access to supportive services can become informed of new employment opportunities, access educational support to give them the necessary skills to secure those positions, connect to employers looking to hire qualified candidates, and get financial literacy support after becoming employed. Establishing a path to better employment outcomes is centered on that worker’s ability to live somewhere that is safe, close to their doctor, grocery store, recreation and place of employment.”

Conversely, rent assistance programs—established at the local level in some cities—have helped renters keep up with rent payments while allowing owners and property managers to maintain their financial and regulatory obligations. While these programs have been effective, they have been implemented sparingly and inconsistently across the state. A centralized federal and/or state rent assistance program would provide the support necessary for both renters and owners to maintain their obligations and remove the need for eviction moratoria during this pandemic.

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Many states, including Texas, require those building LIHTC units to locate their developments near job centers. Location can have a profound impact on residents’ quality of life—not only is this an opportunity to shorten commute times, but it can also reduce transportation costs. Since many of the families that live in affordable housing are already cost-burdened, cutting transportation costs matters. But it’s not just about the commute.

Having more options for work means increasing the chances of receiving good pay, benefits, and now, safety.

Texas Unemployment Rate January - August 2020

When the primary strategy for slowing the spread of the virus has been social distancing and staying at home, housing becomes an essential component of health care, job creation, and economic stability. Yet when combined with stagnating incomes, increasing rent rates, and rising unemployment, the obligation to provide affordable places to live for families is now more imperative than ever.

No child should be left behind: homes are now schools and daycares

15.0% 12.5% 10.0% 7.5% 5.0% 2.5% 0.0% Jan

The effects of inadequate education opportunities follow children into adulthood. We cannot talk about economic recovery without talking about our future citizens, neighbors, and workforce. As such, the importance of schools in families’ lives cannot be understated: they are education and socialization centers, meal providers, and day cares.

Feb

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Senior, low-income, minority populations are most vulnerable to the effects of the global pandemic. Many people considered “essential” or “frontline” workers aren’t able to work from home. This group includes grocery, healthcare, childcare, public transit, trucking and warehouse, and cleaning service workers—occupations which are disproportionately held by women, people of color, immigrants, and people over 50.

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Affordable Housing is the

LONG-TERM SOLUTION to Economic Recovery

• Income-based rental rates are a solution to the increasing cost of livng.

• Reduced rent eases budget pressures - leaving money available for health care, food and other necessities.

• Supportive services provided at low-income housing tax credit (LIHTC) communities give residents the tools needed to improve employment and economic outcomes.

However, at the onset of the pandemic, schools began shifting toward distance learning and many are sticking to this approach for the time being. For everyone, this has created a direct link between stable housing and education quality.

This situation has exacerbated the growing educational inequalities which already existed between upper- and lower-income families, since it requires access to technology at home. Even when schools provide laptops or other educational technology tools, many children remain at a disadvantage with lack of access to Wi-Fi service, which is needed to connect them with their educators. Families have had to make paying for internet connections a priority within already strained budgets.

Further, parents who are working from home are struggling to juggle work while shepherding their kids through homework, scheduled online classes, and meals. Parents who are working outside the home must figure out who will watch, and in many cases, educate their children while they are away. Homes have become classrooms and daycares, and never has it been so important that families have affordable, stable, and tech-connected housing in which to live and educate their kids.

The link between housing and education goes beyond current circumstances: housing instability often causes families to move to areas with lesser quality schools. Frequent moves have been found to negatively impact children. Studies have shown that affordable housing options can lead to better educational outcomes by limiting overcrowding at home and increasing housing stability.

• LIHTC communities are proximate to job opportunities and transit centers — reducing transportation costs and providing more employment options.

• Affordable housing allows parents to “stay put” — preventing children from bouncing from school-to-school when parents are forced to chase the next rent special.

• Affordable housing development creates jobs in many industries most effected by the economic downturn such as construction workers, jobsite clean-up, food and janitorial services.

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Photo Credit: Shutterstock

Homes Are Now Classrooms Homes have become classrooms and daycares, and never has it been so important that families have affordable, stable, and tech-connected housing in which to live and educate their kids.

LIHTC developments create jobs and boost economies

On an individual level, LIHTC communities help their residents find jobs, access services, and live near grocery stores, schools, and job centers—all while reducing their cost burden.

Walker explains: “[Affordable housing] matters to the backbone of our local economies providing housing for health care providers, teachers, mechanics, hospitality workers, first responders and others. It matters to our health systems, connecting residents to medical resources and easing the burden on emergency rooms as primary care facilities […]

Creating an economy that works for all out of this pandemic depends on greater availability of affordable housing.”

LIHTC housing also extends economic benefits to the larger communities they inhabit. At the national level, LIHTC developments generate approximately $7.1 billion in economic revenue, and roughly 95,000 jobs every year across all industries. According to a study by the National Association of Home Builders (NAHB), the first-year impact of building 100 apartments includes $8.7 million in income (wages for workers, profits for small and large businesses, and proprietors), $3.3 million in taxes, and 116 jobs (about half of these in the construction sector).

Photo Credit: Mark Hiebert Photography

ECONOMIC BENEFITS OF AFFORDABLE HOUSING DEVELOPMENT IN TEXAS

328,007 TEXAS JOBS CREATED ANNUALLY

$12.31 B

TEXAS TAX REVENUE GENERATED ANNUALLY

Affordability is the Future

$31.6 B

LOCAL INCOME GENERATED ANNUALLY

Photo Credit: Shutterstock

Affordable housing helps people become more productive members of our communities. LIHTC housing has served our most vulnerable for decades, and now, at a time when vulnerable groups are bearing the brunt of the economic impact, affordable housing is well-positioned to continue to do so. A safe, stable home is the cornerstone of our quality of life: it provides people with the ability to save, pursue an education, and take care of their health and family well-being without having to work multiple jobs.

According to the NAHB, LIHTC has generated about 75,000 units per year nationwide. But even so, there was still a dearth of over 700,000 affordable housing units. Given the current situation, that gap will certainly grow. In fact, 24 percent of Texans think they may not be able to pay rent in September. What can we do about this? We can increase the supply of affordable housing.

Some of the main barriers to delivering affordable housing where it is most needed are regulatory. In Texas, there are a few legislative measures that would help increase supply, while not increasing the financial burden of the state or its taxpayers.

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REMOVE BARRIERS TO DEVELOPMENT OF

AFFORDABLE HOUSING IN TEXAS Take NIMBY out of the competitive process Texas is one of only 10 states that requires letters of support from state representatives, city resolutions of support, and letters of support from neighborhood organization as scoring criterion. Texas is the only state that attributes such a high score (8, 17 and 8 points respectively) to these factors.

These scores codify the ability to “Not in my backyard” or “Nimby” sentiment to determine whether a project moves forward.

Increase supply by removing resolution of no opposition The 4 percent HTC program requires, as a threshold item, resolutions of no objection from city councils, resulting in a politically charged environment that hinders building affordable housing, especially in suburban areas where land is already appropriately zoned.

Remove barriers to building affording housing in areas of greatest need The 9 percent HTC program incentivizes developments in census tracts in which there are no other existing tax credit developments. This provision effectively disincentivizes developments in densely populated urban areas where there is the most need, despite the existence of another tax credit development.

Standardize the appraisal process The current appraisal method leads to inconsistent property valuation and costly litigation, tying up funds that could be used toward maintenance of existing properties or increasing the supply of affordable housing.

Launch a state housing tax credit program While this program would not be cost free, it would result in a significant boost to affordable housing funding. Currently, there are fourteen states that have a state housing tax credit program to provide gap funding or supplemental funding to the federal 9 percent or 4 percent Housing Tax Credit programs for new construction, rehabilitated, and/or preservation of affordable housing developments. Additionally, some states use their tax program to increase supply of affordable housing for targeted populations. In Texas, a bill that would have created a state tax credit program passed the House, but was never heard in the Senate in 2019. The bill would have , allowed eligible HTC property owners to claim a non-refundable credit against the franchise tax,the state insurance tax premium and retaliatory taxes. The credit would be available for any tax year within the 10-year period following the placed in-service date, with a total credit limit of$35 million per year. Given that Texas, like other states, is in a housing crisis, the creation of a state tax credit program can assist with increasing the supply of affordable housing across the state.

Recovery: We are all in this together

Satisfying the immediate needs of our residents is vital to making it through these trying times. But the role of affordable housing is a long-term strategy that goes beyond the duration of the pandemic: it can serve to improve educational outcomes, get residents into better jobs, and bring more people into the economy that have previously been left out. With just a few strategic modifications to regulations, we can increase the supply of quality affordable housing to ensure more people can pull themselves and their families out of this crisis, while promoting the type of integration that discourages disparate outcomes. Together, we will recover—let’s make sure we come back stronger than before.

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The partner for those who know the difference

Hudson Housing Capital has delivered consistent results for tax credit investors and affordable housing developers since 1998.

But it’s also the simple things that set us apart: Care in working with our partners, private ownership with a view toward the long term, thorough underwriting and meticulous asset management.

Those who have worked with us know the difference.

630 FIFTH AVENUE, 28TH FLOOR, New York, NY 10111 212.218.4488 • hudsonhousing.com

MI SSION DRIVEN LENDING

Partnerships Matter.

Centrant Community Capital is your lending partner at every step, offering first-lien permanent mortgages to finance affordable multifamily housing.

From application through ribbon-cutting, we offer a process that is focused, flexible and responsive – so that you can concentrate on the complexities of development and supporting your residents’ needs.

How can we partner with you?

Contact us to learn more.

(984) 344-9992 david@centrant.org centrant.org

SPOTLIGHT

Affordable

Housing

COMMUNITY Success Stories Te x a s A f f o r d a b l e H o u s i n g M a g a z i n e

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RED STONE EQUITY IS A NATIONAL REAL ESTATE INVESTMENT FIRM PROVIDING INNOVATIVE FINANCIAL PRODUCTS FOR AFFORDABLE MULTIFAMILY HOUSING DEVELOPMENT AND TAX ORIENTED INVESTMENTS

DREW FOSTER DIRECTOR, ACQUISITIONS DREW.FOSTER@RSEQUITY.COM

WW W. RS EQU IT Y. COM

BOSTON • CHARLOTTE • CHICAGO • CLEVELAND • LOS ANGELES • NEW YORK • SAN DIEGO

SPOTLIGHT

ALTON

Longview, TX

Plaza

A

lton Plaza is an adaptive reuse of Longview’s historic Petroleum Building, originally built in 1953 as a 5-story parking garage. In 1956, the building’s upper three stories were converted into offices, and the entire building was redesigned by famed Houston architecture firm Wilson, Morris, Crain, & Anderson.

The building became a centerpiece of downtown Longview for decades, with offices and an iconic Southern diner, “The Coffee Shop,” until the building closed in 1990 due to the discovery of asbestos.

For over 25 years, the office building sat vacant, falling into disrepair, and extensively vandalized. The City of Longview considered it for demolition until Saigebrook Development purchased it in 2018, using Low-Income Housing Tax Credits and Historic Tax Credits. The City of Longview provided loan funds to assist with the acquisition and rehabilitation as an alternative to demolishing the building.

Now, the Petroleum Building has a third life as a mixed-income apartment community in the heart of downtown Longview. The project consists of 48 units, 68% of which are affordable at 30%, 50%, and 60% area median income. The exterior façade of the building remains the same architectural masterpiece of Wilson, Morris, Crain, & Anderson, including original windows, massing, and prominent building sign, while the interior has been transformed into a colorful modern apartment homes and shared community space.

Location: 202 E Whaley St. Longview, TX 75601 Developer: Saigebrook Development, LLC Lisa Stephens

Syndicator and Lender: Syndicator: Red Stone Equity Partners Lenders: BBVA Compass & The City of Longview

Alton Plaza is an adaptive reuse of Longview’s historic Petroleum Building

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SPOTLIGHT

ALTON Plaza Longview, TX

Units and Composition: 48 units total

By Bedroom: 8 Studio 15 1 Bedroom/1 Bath 25 2 Bedroom/ 2 Bath

By Income Level: 4 affordable at 30% AMI 7 affordable at 50% AMI 22 affordable at 60% AMI 15 at market rate

Supportive Services Alton Plaza offers a variety of free on-site services for residents through Portfolio Resident Services. These include but are not limited to:

• Financial planning classes • Health, nutrition, and cooking classes • Youth programming: + Arts and crafts

+ Character building discussions + Recreational activities

• Weekly social events for residents Green Initiative Alton Plaza is NGBS-Silver Certified, as well as being inherently environmentally friendly by virtue of being a historic rehabilitation instead of a new build. Units feature resilient materials, high-efficiency Energy Star appliances and high-efficiency lighting.

Type of Funding: 9% Housing Tax Credits State and Federal Historic Tax Credits Architect & Interior Design: REES and Ink and Oro Creatives Tax Credit Consultant: Sarah Anderson Consulting, LLC General Contractor: McPherson Contractors, Inc. For More Information please contact: Alton Plaza, 352-213-8700

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Photography by Dean Wazkowiak

Part of structuring a successful affordable housing deal.

As part of our new affordable housing initiative, we are proud to support the Texas Affiliation of Affordable Housing Providers. How can our specialized Affordable

Civil Engineering Consulting for every step from Site Design Feasibility Reports to Design and Construction

Housing platform help your next project thrive?

Call 800-737-2344 or visit mtrcc.com/learnmore to get the conversation started today.

Jeffrey Rodman Affordable Housing Program Manager 972-624-9765 jrodman@mtb.com

HOUSTON | SAN ANTONIO wga-llp.com

Equal Housing Lender. ©2020 M&T Realty Capital Corporation. M&T Realty Capital Corporation is a wholly-owned subsidiary of M&T Bank, Member FDIC. mtrcc.com 47100 200730 VF

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(817) 924-1370 Te x a s A f f o r d a b l e H o u s i n g M a g a z i n e

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SPOTLIGHT

CANNON Courts D

Bangs, TX

eveloping affordable housing in major markets is admirable, but it happens in great volume every year. While Texas has some huge cities, it only has eleven with over a quarter million people. By and large, Texas is a small town, rural state.

Cannon Courts is proof that high quality affordable housing can be built even in the myriad small towns that dot the Texas landscape.

Cannon Courts is a new construction garden style apartment complex featuring thirty-six (36) units including a diverse mix of 1, 2, and 3 bedroom units which will serve families at 30, 50 and 60% of area median gross income. This development would not have been possible without the additional opportunities afforded by the HOME program. Thanks to the Housing Tax Credit equity, HOME funding, and traditional debt, Cannon Courts will provide many of the same energy efficiencies that market rate developments provide.

Underground power was utilized and a local telecom provider ran miles of fiber optic cable to serve this small town community.

Aesthetically, Cannon Courts was designed by a team of Architects to not only meet but to exceed its market rate counterparts. High ceilings, designer wood cabinets and a pleasant family-friendly landscaping will provide a proud home for the residents.

Cannon Courts received the tax credit award in July 2018 and the HOME award in October of 2018. The financing team and all parties worked closely together to close all the financing pieces as quickly as possible so construction could begin. Once closed, the construction team was remarkable from start to finish. Construction was completed way ahead of schedule in only ten (10) months. The leasing team stepped in and began lease-up just before the COVID-19 crisis hit our state and leasing is underway and going strong.

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Photos: Scott Coers Location 808 East Hall Street, Bangs, Texas 76823

Developer: Rosemark Real Estate, LLC, Winreaux Development, LLC, Keyridge, LLC and Arx Housing Initiatives, LLC

Syndicator and Lender: CREA, Origin Bank, and HOME Partnership funds with the Texas Department of Housing and Community Affairs (TDHCA)

Built Green so Residents Can Save Even More!

All units are equipped with Energy Star appliances including washers and dryers along with high efficiency faucets, toilets and water heaters. In addition the property features underground power LED street lighting.

Units and Composition:

Resident Profile: Individuals and Families Type of Funding: 9% Competitive Tax Credits, Traditional Debt and HOME Partnership Funds.

Architect: McCarty Architects, Kurt Shettles (Architect of Record) and Jay Bryan (Design Architect) For More Information please contact: Robbye Meyer, robbye@arxadvantage.net (512) 963-2555

The development is comprised of thirty-six total units with a mix of 1, 2 and 3 bedroom units. It will serve individuals and families with 30%, 50% and 60% area median gross incomes.

On-Site Amenities:

+ Business/Learning Center

+ Furnished Community Center

+ Dusk to Dawn exterior lighting + Energy Star appliances

+ Energy Star lighting package

+ High efficiency faucets/toilets/water

heaters, Washer/Dryer in each unit

“Home

is where SAFETY and BEN REISMEYER, COMFORT meet.� Asset Manager

More than ever, it is imperative to have a decent, safe place to call home. With the help of our investor and developer partners, CREA has been involved in the creation of over 657 affordable properties - including Gateway at Hutchins. As one of the largest 4% LIHTC projects in Texas, Gateway at Hutchins brings 336 affordable homes to families in the Hutchins community.

CREALLC.COM

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At RED, it’s not just a loan.

We seek to understand your short- and long-term goals and develop the right financing package to help you get there, with industry-leading expertise and seamless execution.

redcapitalgroup.com DUS® is a registered trademark of Fannie Mae. RED Mortgage Capital is a division of ORIX Real Estate Capital.*Securities, Investment Banking and Advisory Services provided through OREC Securities, LLC. Member FINRA/SIPC.

Dauby O’Connor & Zaleski, LLC

AFFORDABLE. ACCOUNTANTS. Audit • Tax • Consulting www.doz.net

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Locations Carmel, Indiana Austin, Texas 317.848.5700 info@doz.net

SPOTLIGHT

HERITAGE

Seniors

Montgomery, TX

H

eritage Seniors is a brand-new community built for the active 55+ adult.

Conveniently located in the heart of Historic Downtown Montgomery. The spacious units come in one- or two-bedroom layout options with energy efficient appliances including washer and dryer in-unit.

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SPOTLIGHT

HERITAGE

Seniors

Montgomery, TX

Silverleaf at Panhandle Seniors 219 Flagship Blvd, Montgomery, TX 77316

Developer: Nantucket Housing, LLC & Education Based Housing, Inc. Syndicator and Lender: Bank of America

Photography by Rachel Van Nieuwenhuise Resident Profile:

On-Site Amenities:

55+ Active Senior

+ Grille House & Covered Cabanas

Units and Composition:

+ Covered Parking

80 Units Total Affordable (64) Conventional (16) Type of Funding: Housing Tax Credits Architect: Mucasey and Associates Architects

+ Large Resort Pool with Sun Deck

+ Fitness Center, Machines & Free Weights + Club Room with Kitchen & Coffee Bar + Elevator Access to all Buildings

+ Access Gates with Perimeter Fencing + Business Center with Computers + Washer & Dryer in Units + On-site Maintenance

Special Design Features: Porte Cochere Entrance, Lap pool with walk-in entry and lounging ledge, Laundry in every unit.

Support Services:

+ Planned Activities

+ Bus transportation on-site

For More Information please contact: Blazer Building - (713) 914-9200 Property Photos by Dee Zunker 34

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Dedicated to clients.

Dedicated to communities.

Dedicated to the future.

In uncertain times, one thing is certain. You need someone dedicated to you. With the resources, solutions and vision to see you through.

“Bank of America” and “BofA Securities” are the marketing names used by the Global Banking and Global Markets divisions of Bank of America Corporation. Lending, other commercial banking activities, and trading in certain financial instruments are performed globally by banking affiliates of Bank of America Corporation, including Bank of America, N.A., Member FDIC. Trading in securities and financial instruments, and strategic advisory, and other investment banking activities, are performed globally by investment banking affiliates of Bank of America Corporation (“Investment Banking Affiliates”), including, in the United States, BofA Securities, Inc. and Merrill Lynch Professional Clearing Corp., both of which are registered broker-dealers and Members of SIPC, and, in other jurisdictions, by locally registered entities. BofA Securities, Inc. and Merrill Lynch Professional Clearing Corp. are registered as futures commission merchants with the CFTC and are members of the NFA. Investment products offered by Investment Banking Affiliates: Are Not FDIC Insured • May Lose Value • Are Not Bank Guaranteed. ©2020 Bank of America Corporation. All rights reserved. 3162556 09-20-0244

Wilmington Trust has been serving Corporate Trust clients for more than a century, providing the strength, resources, and credibility to meet the needs of sophisticated enterprises. We continuously strive to be a leading provider of specialized services to corporate and institutional clients and helping them succeed by efficiently delivering trust, agency, and fiduciary solutions, as well as by helping mitigate risk.

Stephen McPherson 972-383-3161 smcpherson@wilmingtontrust.com www.wilmingtontrust.com

B U I LD I N G EXC EL L EN C E SIN C E 1 9 7 8

FA MILY O W N E D & O P E R AT E D F O R 4 2 Y E A R S.

Blazer has overseen the construction of more than 35,000 apartment homes totaling over 2 billion in contract value. w w w. b l a z e r b u i l d i n g . c o m

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Chicago | Denver | Kansas City | Las Vegas | Leawood | Nashville | St. Louis

A full-service affordable and market-rate housing development consulting firm, specializing in both single and multi-family residential development. We offer for-profit and non-profit clients the benefit of our comprehensive experience in entitlement, debt and equity financing, and construction expertise.

◆ 6700 housing units since 2003 ◆ 5400 affordable units since 2003 ◆ 11�6 units in conjunction with housing authorities since 2003 ◆ 1160 units with Hurricane CDBG-DR money since 2008 ◆ 1290 mixed-finance units with HUD since 2003 ◆ $17.05 million in HOME funds (including Section 108 loan funding) ◆ $76 million in CDBG-Hurricane Recovery Funds, plus GO ZONE HTC; $105 million total (includes Section 108 loan funding) ◆ Total AHP Grant or other funds, including HTF: $8 million ◆ Total HTC Equity 4% and 9%: $350 million allocated from TDHCA, MFA, OHFA and CHFA ◆ $370 million in tax-exempt bonds issued and sold ◆ 3342 total Senior Housing units in Texas since 1997

16812 Dallas Parkway ◆ Dallas, TX 75248 ◆ 214.608.7201 ◆ SonomaAdvisors.com

BUILDING A BETTER TOMORROW. Chase is proud to sponsor TAAHP’s 2020 Texas Housing Conference, and we applaud its leadership in increasing the supply and quality of affordable housing for Texans with limited incomes and special needs.

To learn more about Chase Community Development Banking, please visit chase.com/cdb or contact: Scott Schmid (585) 797-2808

David Saling (512) 479-2218

Olivio Ochoa (214) 965-2678

© 2020 JPMorgan Chase Bank, N.A. Member FDIC. “Chase” is a marketing name for certain businesses of JPMorgan Chase & Co. and its subsidiaries (collectively, “JPMC”).

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SPOTLIGHT

ARIA A

ria Grand is a unique urban living community in Austin’s Travis Heights neighborhood. Two podium buildings, five and six stories tall, provide 70 units of quality urban living—87% of which are affordable at 30%, 50%, and 60% area median income—minutes from downtown Austin. Supported in part by $1.5 million made available by the Austin Housing Finance Corporation, this new community also sets aside seven units to serve formerly homeless or those with disabilities.

Grand

In order to build on this centrally located urban infill site, the developer had to contend with challenges associated with the lot shape, topography, and existing vegetation. In order to maximize the number of affordable housing units onsite, the development team worked to find creative solutions that both met the needs of the future residents and the City of Austin Land Development Code.

Austin, TX

Living in a mixed-income community offers benefits to households at all income levels, including the development of diverse and rich social and support networks, and opportunities for sharing information and resources. On-site services at Aria Grand promote this kind of relationship-building among neighbors, through free weekly social events, classes on health, nutrition, parenting, and personal finance, and children’s activities that offer an opportunity for parents to have a break, knowing that their children are supervised nearby.

Aria’s residents have a lot to say about the benefits of new, high, quality affordable housing in such a desirable location.

One resident wrote “The inside of my apartment is beautiful and new. The grounds are beautiful and always immaculate.

The rent couldn’t be better, and the location is perfect. I finally found an apartment that I call my home.”

The rent couldn’t be better, and the location is perfect. I finally found an apartment that I call my home.

Aria Grand Resident

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SPOTLIGHT

ARIA

Austin, TX

Grand

Architect: Miller Slayton Architects Special Design Features: At Aria Grand, we were pleased to work with Ethan Azarian of Blue Cow Studios and students from Travis Heights Elementary School to create four beautiful murals within our parking garage. The students had the opportunity to work directly with the artist on-site at the property and were excited to create a lasting mark on their neighborhood.

Photos by Brian Mihealsick Location 1800 S IH 35 Frontage Rd, Austin, TX 78704 Developers: O-SDA Industries, LLC, Megan Lasch Saigebrook Development, LLC, Lisa Stephens Syndicator and Lender: Boston Capital JP Morgan Chase Community Bank of Texas City of Austin RHDA General Obligation Bonds Resident Profile

Serving families at various income levels Units and Composition: 70 units total

By bedroom: 12 1 Bedroom/1 Bath 30 2 Bedroom/ 2 Bath 28 3 Bedroom/2 Bath

By income level: 6 affordable at 30% AMI 24 affordable at 50% AMI 30 affordable at 60% AMI 10 market rate

Type of Funding: 9% Housing Tax Credits through Texas Department of Housing and Community Affairs, $1.5M in General Obligation Bonds through the Austin Housing Finance Corporation 40

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Supportive Services Aria Grand offers a variety of free on-site services for residents through Portfolio Resident Services. These include but are not limited to:

• Financial planning classes • Health, nutrition, and cooking classes • Youth programming: + Arts and crafts

+ Character building discussions + Recreational activities

• Weekly social events for residents

Boston Capital proudly supports the Texas Affiliation of Affordable Housing Providers and its efforts on behalf of the affordable housing industry.

Multifamily • Compliance • Lease-Ups New Community Development • Acquisition • Due Diligence

As a full-service real estate investment management firm, FDI provides multifamily residential management with a broad scope of realty services, including acquisition, compliance lease-ups, disposition, rehabilitation, and asset management. FDI’s management expertise is complimented with personal service as well as expertise in the industry.

Tom Dixon — Vice President, Acquisitions 310-339-4376 ▪ tdixon@bostoncapital.com One Boston Place, Suite 2100, Boston, MA 02108-4406 www.bostoncapital.com ▪ Twitter: @bostoncapital

FDI currently manages properties throughout Texas and Louisiana. Our clients include: Developers, Property Owners, and Real Estate Investment Groups.

281-367-5222 | www.fdimgt.com

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Palladium USA is proud to announce constru Partnered with the City of Dallas, the 4-story, 300-unit, mid-rise includes structured parking, elevators, controlled access, fitness center, clubroom, internet lounge, library, swimming pool, coffee bar, playground, gazebo, grilling areas, and much more.

The property will offer one, two, and three bedroom very-well-appointed affordable apartments serving residents in the 30% and 60% area median income along with market-rate units.

Palladium is honored to be chosen to provide the multifamily component for this high-profile revitalization of the former RedBird Mall in southern Dallas.

Palladium USA | Premier Developers of Affordable Housing 13455 Noel Road, Suite 400, Dallas, Texas 75240 (972) 774-4400 www.palladiumusa.com

Co So mi on ng

uction of Palladium RedBird in Dallas, Texas.

“Changing lives, one apartment home at a time.”

Our developments speak directly to our commitment to provide Class A affordable housing to families, seniors, and veterans. Every property reflects our capabilities and dedication to quality

Palladium Anna, 120 affordable and market-rate units. Anna, Texas

Palladium Fort Worth, 150 affordable and market-rate units. Fort Worth, Texas

Palladium Denton, 150 affordable and market-rate units. Denton, Texas

SPOTLIGHT

THE NIGHTINGALE

at Goodnight Ranch G

Austin, TX

reenbelts for nature lovers border The Nightingale’s mixed-income development. With a three-story elevator-served building, surrounded by single story cottages on a 7-acre site, this beautiful new addition to Southeast Austin, which opened in late fall 2019, provides residents a luxury option to affordable living.

DMA Development was invited by the master developer for Goodnight Ranch to develop an affordable senior component within this Urban Village concept in a burgeoning area of Southeast Austin. The timing in the 2017/18-time frame was less than perfect with the design and development stage falling in the midst of tax reform with tremendous drops in credit pricing.

DMA partnered with the Austin Housing Finance Corporation to attain property tax exemption as well as an exemption from sales tax on construction materials. Additionally, the City of Austin provided $2M in forgivable loan proceeds.

Construction commenced in March 2018.

Location 5900 Charles Merle Drive, Austin, TX 78747 Developer: DMA Development Company, LLC

Syndicator and Lender: Boston Capital Construction Lender: Chase Bank Permanent Lender: Bellwether Enterprise

Built Green

so Residents Can Save Even More!

One-Star rating from Austin Energy Green Build; LEED certified, star rated appliances, 14 SEER HVAC system, and efficient water fixtures.

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Photos by Diana McIver

Units and Composition:

Resident Profile: Seniors age 55+

174 total units. 30% AMi - 11, 50% AMI - 20, 60% AMI - 94, 80% AMI - 19, Market - 14

Type of Funding: 4% Tax Credit with Private Activity Bonds, TDHCA Housing Trust Funds of $1 Million and COA funding of $2 Million.

On-Site Amenities:

+ Pool with Outdoor Gazebo and Grill + Movie Theatre/ Auditorium

+ Community Room with Kitchen

Architect and Contractor: Kelly Grossman Architects, Austin, TX Blazer Construction, Houston, TX

+ Business Center with Internet

+ Game Room with pool table, poker table,

game tables and television + Arts and Crafts Studio + Fitness Center + Laundry center with seating

For More Information please contact: Blake Mauldin, Marketing Manager blakem@dmacompanies.com 512.328.3232 x4502

AFFORDABLE HOUSING IS OUR MISSION.

AND WE’RE IN IT FOR GOOD.

DMA Development Company, LLC DMA Properties, LLC Development, Financial and Property Management Services for Multifamily, Affordable and Special Needs Housing

For nearly 40 years, we’ve had just one mission: to improve as many lives as possible by creating well-designed, affordable homes and connecting people to opportunity.

We are in it for the long haul. We’re in it for good.

Enterprise is a proud sponsor of the 2020 Texas Housing Conference.

Reagan Maechling

Philip Melton

Vice President, Acquisitions

EVP, National Director of Affordable Housing & FHA Lending

Enterprise Housing Credit Investments, LLC

Bellwether Enterprise Real Estate Capital, LLC

213.787.8238

469.729.7677

rmaechling@enterprisecommunity.com

pmelton@bwecap.com

www.EnterpriseCommunity.org

www.bellwetherenterprise.com

© 2018 Patrick Y Wong / AtelierWong.com

www.dmacompanies.com | 4101 Parkstone Heights Drive, Austin, TX 78746 | 512.328.3232

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Our continuing commitment to quality products may mean a change in specifications without notice. © 2016 Goodman Manufacturing Company, L.P. · Houston, Texas · USA

www.goodmanmfg.com

A Lender that gives you the full picture.

As a full-service lender we not only take your project from concept meeting through loan closing, but we also service your loan in-house for the term of the loan. You remain a client with Davis-Penn, benefiting from our experienced servicing department, so your Lender is always by your side.

Davis-Penn Mortgage, Co. has successfully structured, closed, funded and serviced 9% LIHTC, 4% LIHTC, Year-15 re-syndications, RAD, HAP and market rate transactions. Contact us with any questions or opportunities you'd like us to explore with you.

Ray Landry │ rayl@davispenn.com Kristin Welch │ kristinw@davispenn.com 12650 N. Featherwood Dr., Suite 120, Houston TX 77034 www.davispenn.com │281-481-2400

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We provide insurance claim assistance for residential and commercial properties.

Let us help you from DISASTER to RECOVERY.

gulflossconsultants.com

281-225-0085

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47

SPOTLIGHT

REED

By New Hope Housing Houston, TX

N

ew Hope Housing Reed provides attractive, affordable apartment living for 187 families with extremely low incomes. As the organization’s first supportive housing property serving vulnerable families with children, the Reed development is designed with the goal of uplifting formerly homeless families from generational poverty.

Reed offers a unique campus atmosphere, as it is located on seven acres immediately adjacent to Star of Hope’s 41-acre Women & Family Development Center Cornerstone CommunitySM and Buckner International’s Family Hope Center.

By mission and model, this project represents a continuum of care that is a cost-effective solution to alleviating homelessness.

The Reed property is LEED Gold certified, making it New Hope Housing’s fifth energy-efficient ‘green’ housing community. Committed to creating transit-oriented developments, New Hope worked with Star of Hope to secure a newly situated METRO bus stop on a private street within the campus boundaries.

The creation of a sense of place through art, architecture and nature is an integral part of New Hope Housing’s award-winning approach to affordable housing.

Location: 2605 Reed Road, Houston, Texas 77051 Developer: New Hope Housing, Inc.

Syndicator and Lender: National Equity Fund, Inc. BBVA Compass Bank

Built Green

so Residents Can Save Even More!

LEED Gold Certified

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For More Information please contact: Joy Horak-Brown, President and CEO joy@newhopehousing.com 713.222.0290

Photos by Mark Hiebert Photography & Terry Mason Photography

Supportive Services:

+ Case Management

+ Information and referral services + Emergency financial support

+ Job training and mental health counseling

+ Enrichment programs for teens and for adults + Free after-school and summer programs + Life-skills training including financial

Residents have access to this 6,000 square-foot-multi-purpose community building situated in the courtyard that accommodates educational services and social activities, including after-school and summer programs.

management, legal assistance, and health and nutrition classes + Recreational and social activities Units and Composition:

187 LIHTC units of 1-, 2-, and 3-bedroom furnished apartments including a fullyequipped kitchen Resident Profile: New Hope Housing Reed is a supportive housing property serving vulnerable families with children, majority of whom are families led by single-mothers. The community serves families earning 30-60 percent of the average median income, which in Houston for a family of four is $20,750 to $41,520.

Type of Funding: 4% Tax Credit with Private Activity Bonds, TDHCA Housing Trust Funds of $1 Million and COA funding of $2 Million.

On-Site Amenities:

+ Private Market and Hope Chest + Business Center

+ Libraries for Adults and Children + Training Rooms for Educational + + + + +

Programming Indoor Learning Center Wellness Room for Health-Related Activities Teen Enrichment room Courtyard with Playground Equipment Outdoor Cooking Area with Picnic Tables and Barbecue grills

Architect and Contractor: Ernesto L. Maldonado, AIA, with GSMA, Inc.

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Cooking fires are the #1 cause

of RESIDENTIAL casualties & property loss.

StoveTop FireStop is the best defense to protect your residents, your property, and your bottom line.

Choosing the Right Builder is Everything HUD-PREFERRED BUILDER / FOUNDED 1972 WWW.BROADDUSCONSTRUCTION.COM

Automatic Cooktop Fire Suppression

stovetopfirestop.com

since 1972

© 2020 WilliamsRDM, Inc. All rights reserved.

NATIONAL AFFORDABLE HOUSING LENDER, SPECIALIZING IN HUD & USDA 538 LOANS Chris Mullen cmullen@bmfcap.com Rob Hall rhall@bmfcap.com

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THE

SPOTLIGHT

RESERVE

at Dry Creek

Hewitt, TX

Photos by Lisa Zaiontz

T

he Reserve at Dry Creek is a 113-unit senior community located in Hewitt, Texas. The design includes a three-story elevator-served building, which includes both apartments and community amenity areas, surrounded by single story cottages, many with attached carports. This is the first affordable senior community in the City of Hewitt and the City was incredibly supportive.

The Reserve at Dry Creek received an allocation of 9% credits in July 2016 and executed a Letter of Intent with an investor shortly before the 2016 Presidential Election. However, with the election of President Trump, who had significant corporate tax reform as part of his campaign platform, investors across the nation put a halt to their investments in housing tax credits until they had certainty in corporate tax rates. The equity loss to this development based on assumed lower cor-

porate rates was huge – approximately $1.6 million dollars.

Fortunately, DMA was able to obtain a 0% loan from TDHCA in the amount of $1,450,000 to bridge the funding gap. (A $1,000,000 HOME loan had been previously approved.)

Initially projected to close in March 2017, this financial restructuring caused a delay and the development closed in June 2017. Construction was finished in stages with units coming on line between May 2018 and August 2018.

Long lines formed as the eager seniors applied for apartment homes in advance of its opening. The property’s luxury units of nine single-story cottage style buildings and one-three story building filled a large market gap in affordable housing options. Now residents enjoy many amenities and activities to foster an energetic community.

Long lines formed as the eager seniors applied for apartment homes in advance of its opening.

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SPOTLIGHT

THE

RESERVE Hewitt, TX

Location 701 N. Old Temple Rd., Hewitt, TX 76643 Developer: DMA Development Company, LLC/JSA Development Company, LLC Syndicator and Lender: Boston Capital Resident Profile:

Supportive Services: During COVID-19, our strong partnership with Shepherd’s Heart, a nonprofit that provides food to thousands of individuals in the Waco and surrounding areas, is even more critical since one third of our residents are dependent on that caring service. We call ourselves a “Community of Love” because the residents look out for one another and provide support in so many ways.

Other support services offered are:

55+ Active Senior

+ Morning Chats online through Zoom (COVID-19 period)

Units and Composition:

+ Social services to connect residents to resources

80 Units Total Affordable (64) Conventional (16) Type of Funding: Housing Tax Credits Architect & Construction: Kelly Grossman Architects, Austin, TX Blazer Construction, Houston, TX For More Information please contact: Blazer Building - (713) 914-9200 On-Site Amenities:

+ Movie Theatre/Auditorium

+ Community Room with Kitchen

+ Library/Business Center with Internet + Living room with game tables and

television

+ Fitness Center

+ Laundry Center

+ 9-foot ceilings in every unit + Full appliance package

+ Low-maintenance flooring

52

at Dry Creek

Te x a s A f f o r d a b l e H o u s i n g M a g a z i n e

+ Onsite maintenance for critical repairs during COVID-19 + Seminars on Finance and Home Healthcare + Blood Drives

+ Movie “nights”, bingo, potluck suppers

Public Finance

STIFEL WAS RANKED THE #1 NATIONAL UNDERWRITER OF MULTIFAMILY HOUSING REVENUE BONDS FOR 2019* A Leading Investment Bank Specializing in Affordable Housing Finance Stifel, Nicolaus & Company, Incorporated, founded in 1890 and headquartered in St. Louis, Missouri, is a subsidiary of Stifel Financial Corp., a publicly held company traded on the New York Stock Exchange. Stifel has long established itself as a leading underwriter of multifamily housing revenue bonds. Over the years, Stifel has demonstrated a leadership position in the structuring and marketing of multifamily housing securities. As a national leader in multifamily housing finance, we help our clients achieve strategic objectives through comprehensive investment banking services, in-depth housing sector knowledge, debt structuring, and trading expertise.

Experience Includes • • • • • • • •

Fannie Mae M.TEB (forward + immediate delivery) Private Placements Collateralized short-term multifamily housing bonds Standard & Poor’s and Moody’s unenhanced project finance rated bonds Rental Assistance Demonstration (RAD) program bonds USDA Rural Development pooled bond financings Bonds secured by FHA-insured mortgages Fannie Mae and Freddie Mac credit-enhanced bonds

Rankings As noted by the chart below, Stifel was the #1 ranked underwriter of multifamily housing revenue bond issues for the past five years, based on the number of issues brought to market. Experience matters, and accordingly, we have underwritten more multifamily housing issues than any other firm in the nation during that time period.

National Multifamily Housing Investment Banking Rankings For Years 2015-2019* Year

Rank

Number of Issues

2019

1

82

2018

1

70

2017

1

69

2016

1

53

2015

1

44

Source: Thomson Reuters SDC; Bloomberg *National rankings based on the number of negotiated transactions brought to market and closed from January 1 through December 31 of each year, including firms acquired by Stifel. The 2019 number of issues includes 20 secondary market tax-exempt securitizations that Stifel underwrote for the Freddie Mac M-Series and TEL Program. The 2018 number of issues includes 11 secondary market tax-exempt securitizations that Stifel underwrote for the Freddie Mac M-Series and TEL Program.

Multifamily Housing Investment Banking Team Contacts Montgomery

New York

Baton Rouge

Seattle

John Rucker III (334) 834-5100 ruckerj@stifel.com

Christopher Moriarty (212) 847-6610 moriartyc@stifel.com

John Sabatier (727) 871-1408 sabatierj@stifel.com

Dan Dill (425) 455-8122 dilld@stifel.com

Dallas

Denver

Bryan Klitzke (214) 706-9483 klitzkeb@stifel.com

Brad Edgar (303) 291-5263 edgarb@stifel.com

David Dill (425) 455-8122 daviddill@stifel.com

William (“B.J.”)Biggio (334) 834-5100 biggiow@stifel.com Sue Alley (334) 834-5100 alleys@stifel.com

Stifel, Nicolaus & Company, Incorporated | Member SIPC & NYSE | www.stifel.com

#0320.29993096.1

BETTER LIVING IS A BETTER FUTURE

THE J4 DIFFERENCE

Whatever It Takes

J4 Development Inc is a multifamily construction firm providing general contracting services nationwide for LIHTC owners and developers. Specializing in Affordable, Workforce, Seniors and Adaptive Reuse housing.

1700 Jay Ell Dr. #100 ● Richardson, Texas 75081 972-930-7075 Phone ● 469-480-3400 Fax

www.agmfinancial.com

AGM congratulates TAAHP on achieving 23 years of providing high quality affordable housing.

AGM finances affordable housing nationwide.

SPOTLIGHT

THEN & NOW: 15 YEARS LATER

WESTVIEW

W

Ranch

estview Ranch was developed by DMA Development Company utilizing a 2013 award of tax credits and was placed in service in 2005. Westview Ranch has a total of 72 apartment homes for families, of which 68 have affordable rents.

Of the affordable units, 52 have rents at 60% AMI, 14 have rents at 50% AMI, and 2 have rents at 40% AMI. The design includes a mix of one-, two-, and three-bedroom units in single story cottage and townhome units with stone, hardi and stucco exteriors. The property is managed by DMA’s affiliate – DMA Properties, LLC. Throughout the years, it has had very little resident turnover with occupancy always hovering around 100%.

Now at age 15, the property has matured very nicely. The exterior color scheme has been modernized and the mature landscaping lends to the beauty of the property. At Westview Ranch, there is always attention to upgrading and beautifying our residents’ homes and the important spaces used by our families.

225 WESTVIEW ROAD, PEARSALL, TX 78061

56

TYPE

NEW CONSTRUCTION

DEVELOPER

DMA DEVELOPMENT COMPANY

MARKET

SAN ANTONIO

COUNTY

FRIO

YEAR BUILT

2005

# OF UNITS

72

# OF AFFORDABLE UNITS

68

AMI SERVED

40% (2 UNITS) 50% (14 UNITS) 60% (52 UNITS)

OCCUPANCY RATE

100%

PROPERTY TYPE

FAMILY

FINANCING TYPE

HOUSING TAX CREDITS

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Recent Improvements:

+ Refinished parking lot

+ Freshened the exterior with a new coat of

paint + Updated the playground with rubberized mulch and revised equipment to meet newer ADA-compliant guidelines

AFFORDABLE HOUSING IN THE 21ST CENTURY QUALITY BUILT & MAINTAINED TO A HIGHER STANDARD

C

ommunity connection is what the Westview Ranch residents and staff are all about. The community amenities go way beyond its quality products—customer service is key! For example, during COVID-19, longtime manager Davina Trevino (former Mayor of Pearsall

and now, city council member) provided access to the office and business center’s Wi-Fi; but beyond that she printed out what the students needed for school and delivered these to their door. Thus, truly going above and beyond the role of a typical property manager.

2005

2020

2005

2020 Te x a s A f f o r d a b l e H o u s i n g M a g a z i n e

57

KNOWLEDGE

IS POWER

Find Recent Affordable Housing Research & Studies at taahp.org DISCLAIMER: The Texas Affiliation of Affordable Housing Providers (TAAHP) posts informational resources that may impact or be useful to its members. The views, positions, and opinions expressed in news articles, research studies, or other resources are those of the authors and do not necessarily reflect the official policy or position of TAAHP or its employees. Views are subject to change at any time.

Posted September 2020 Freddie Mac: New Research Shows Affordable Housing Shortage Persists

Study: Expanding the Supply of Affordable Housing for Low-Wage Workers

Posted July 2020

Posted June 2020

Study: For Many Renters, Owning Home Not Possible

Report: Risk Threatening Affordable Housing Preservation

Posted April 2020

Posted May 2020 Analyzing the Impact of Lowering the 50% Test for 4% Tax-Exempt Bond-Financed Properties

Study: Filtering of Apartment Housing between 1980 and 2018

www.TAAHP.org/Housing-Studies 58

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TAAHP SCHOLARSHIP COMMITTEE AWARDS

$52,500

IN SCHOLARSHIPS For the last six years, Texas Affiliation of Affordable Housing (TAAHP) has provided more than $80,000 in scholarship funding to students seeking a higher education. TAAHP’s scholarship program was created to help some of the most vulnerable students in the state pursue a higher level of education as a pathway to self-sustainability and success. This year, TAAHP is pleased to have awarded $52,500 in scholarships to students living in affordable housing communities across Texas. The total reflects a 525% increase in total dollars awarded compared to 2019 thanks to several generous donations by TAAHP members.

“I am extremely honored to be part of Texas’ affordable housing industry — TAAHP members stepped up in a big way and because of their generosity, we have the opportunity to offer larger grant amounts this year to seven very worthy recipients,” says TAAHP

TRADE & TECHNICAL SCHOOLS COLLEGE & UNIVERSITY EDUCATION

OPPORTUNITY

President Janine Sisak. “Assisting with the cost of continuing education is even more critical this year since many of our residents have experienced a loss of income due to the pandemic.”

The 2020 scholarship recipients include:

• Myat May, Austin: $12,500 • Jorgann Holgersen, Mabank: $10,000 • Peace Oluwasanmi, Houston: $7,500 • Heather Mathias, Commerce: $5,000 • Mason Trujillo, Dalhart: $5,000 • Absidy DeHoyos, San Antonio: $5,000 • LaDeja Daughtry, Arlington: $5,000 • Claudia Emmanuel, Commerce: $2,500

Proud to be your trusted environmental & engineering consulting partner for affordable housing projects Environmental Due Diligence Industrial Hygiene Building Sciences Geotechnical Engineering & Testing

Derek Schilling at 952.995.2674 www.braunintertec.com Te x a s A f f o r d a b l e H o u s i n g M a g a z i n e

59

Wow FEATURE

FACTORS

in Affordable Housing Resident Services Meaningful services for residents are a significant difference between affordable housing communities and their market-rate peers. TAAHP members take great care to provide support to their residents that help them thrive and develop a sense of community.

Whether managing a senior community or one that serves families, supportive resident services are an effective and significant way to help Texans reach their potential and serve their needs.

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WILDFLOWER

Terrace

Located at: 3801 Berkman Drive Austin, TX 78723

Senior Community

Photos by Patrick Wong

W

hen DMA Development Company’s largest community for older adults, Wildflower Terrace, opened its doors in 2011 in Austin’s trendy Mueller neighborhood, at the top of the company’s goals was delivering stellar arts, educational and wellness programs to its residents, ages 55-plus. The impressive results—both in resident participation and enhancement of the quality of their lives -- have surpassed expectations.

Inside, Wildflower’s Terrace Room, Library and Fitness Center overflow with friendship, Coffee Chats, and family and friend potluck gatherings. Outside the hike-and-bike trails are filled with vibrant seniors—all signs of a truly active “WOW” community in action!

No wonder we affectionately refer to our residents as the “Wild Flowers”.

LITERARY ARTS

Program

The literary focus welcomed writers to find their voices through the writing workshops conducted by several of Wildflower Terrace author-residents.

Not only did attendees discuss and learn the craft of poetry, fiction and nonfiction, but many went on to celebrate their own book publications. We helped launch several book release parties in the Terrace Room and Auditorium spaces with book readings and signings, and plenty of refreshments.

VISUAL ARTS

Program

Visual arts have also been popular at Wildflower Terrace with classes on everything from book-binding to oil painting to weaving. These community-sponsored programs have brought residents together and support their desire to grow and learn new ways to design lasting works. Classes are frequently taught by the talented residents of Wildflower Terrace and family members of our residents sometimes join for the classes.

HEALTH & WELLNESS

Program

Healthy minds and bodies are equally important to the residents of Wildflower. We provide secure bike storage for nearly 30 bikes, which is always full.

These facilitate access to Mueller’s beautiful parks and trails, plus a quick peddle to the nearby HEB. Several residents organized the Wildflower Polers, which is a group of residents who walk the trails safely with poles similar to ski poles. Resident Joy Stone, who has participated in, and now leads, the twice weekly Tai Chi gathering for more than eight years, noted, “Tai Chi is meditation in motion. It helps with balance, breathing, and flexibility. It gives people a sense of camaraderie and the movements give a feeling of grace and unity, very much like dancing.” And speaking of dance, Wildflower hosts country dances once a month!

Unit Mix 201 Units 157 1-Bedroom 44 2-Bedrooms AMI Served 30% - 80% Developer DMA Development Company, LLC Contact Blake Mauldin, Marketing Manager blakem@ dmacompanies.com 512-328-3232

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WOW FACTORS

WYNDHAM PARK

Apartments

Senior Community

T

he Pen Pals Program at Wyndham Park in Houston links seniors with children at neighboring family communities.

Regularly scheduled activities provide opportunities to write letters in shared journals, which are then exchanged via the Resident Services Coordinators. As life-experiences, humor, and day-to-day stories are exchanged, bridges of understanding are built across generational, racial, and cultural differences. Friendships are cultivated and a sense of accomplishment, pride, and community service is experienced. Seniors place a high value on meaningful purpose and are energized by their contributions to a

Photos Courtesy of Portfolio Resident Services

younger generation. The children also reap many benefits interacting with their elderly friends, including literacy skills practice.

Activities such as this, coordinated through the Good Neighbor Program™ of Portfolio Resident Services focus on helping seniors age-in-place with dignity, support, and positive social connections. Innovative initiatives forge new pathways to meaningful human interaction and help seniors combat loneliness, isolation, as well as bringing a sense of joy to their Golden Years. For video highlights on this and other programs, please visit the Portfolio Resident Services YouTube channel.

Location # of Units Supportive Services Provided by Contact Information

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2700 Rolling Brook, Baytown, TX 77521 184 Portfolio Resident Services Ellie M. C. Fanning, Executive Director 713-808-1988; efanning@prspurpose.org

•

Norris George & Ostrow PLLC (NGO) is seven-lawyer boutique law firm based in Washington, DC specializing tax exempt municipal bond finance with a special emphasis on tax exempt multifamily rental housing bond finance.

•

NGO’s attorneys have over 185 years of exceptionally broad experience in municipal finance, having served as underwriter's or purchaser's counsel, and in other roles as counsel in thousands of tax-exempt bond and loan financings. In the last five years alone, attorneys on the NGO team have served as counsel in more than 600 private and public transactions in 40 states, including over 50 financings in Texas.

•

NGO’s attorneys have been architects of the structures and model documentation for a number of the industry’s major tax exempt debt programs, including the country’s leading tax exempt bond and loan private placement program, short term cash backed tax exempt bonds used since 2008 with FHA insured and rural development loans, the Freddie Mac TEL private placement structure and the Fannie Mae M.TEBs rated publicly offered bond structure.

•

In addition, our practice includes cash flow analyses, rebate computations and yield proof calculations and reports, and opinions and reports required in bankruptcy and debt defeasance transactions.

•

We would love to discuss potential financing opportunities with readers of the Texas Affordable Housing Magazine.

NORRIS GEORGE & OSTROW PLLC 1627 EYE STREET, N.W., SUITE 1220 WASHINGTON, D.C. 20006 TEL: (202) 973-0103 www.ngomunis.com

ESSENTIAL NEEDS AND SUPPORT FOR A BETTER LIFE, PROVIDED BY OUR PARTNER IN GOOD: TEXAS AFFILIATION OF AFFORDABLE HOUSING PROVIDERS

See how we’re helping our communities thrive at capitaloneinvestingforgood.com

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We are proud to be a part of communities that are great places to live in, and next door to.

Jessica Mullins I jmullins@hermankittle.com I 713.344.7055 I hermankittle.com

Guiding your business through extraordinary times

Wells Fargo Commercial Real Estate understands that making business decisions in the current environment is more challenging than ever. Our experienced bankers can provide the financial guidance you need to help navigate your company’s most pressing issues. With our industry knowledge, products, and services, we’re confident we can help keep your business moving forward.

Learn more at wellsfargo.com/affordablehousing.

© 2020 Wells Fargo Bank, N.A. All rights reserved. Member FDIC. IHA-6832113

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WOW FACTORS

LUCEROApartments A FAMILY COMMUNITY

B

uilding Bridges with Law Enforcement, including the Freedom Fest Block Party at Lucero Apartments in Austin, is an example of community engagement that gives residents opportunities to interact with local police officers. In a fun and relaxed setting, residents can get to know them and begin to appreciate them as vital community helpers. These purposeful efforts strengthen neighborhood participation in community safety. It helps to dispel negative and inaccurate stereotypes, allow-

ing everyone to gain greater trust and be relied upon when difficult issues and needs arise. Facilitated through the Good Neighbor Program™ of Portfolio Resident Services, outreach efforts such as this enlarge residents’ engagement in their local community. Working to promote a safer community is a win-win for residents, management, law enforcement, and the whole community! For video highlights on this and other programs, please visit the Portfolio Resident Services YouTube channel.

Located at: 2301 Durwood St Austin, TX 78704 Unit Mix 173 Units AMI Served 30% - 80% Supportive Services Provided by Portfolio Resident Services Contact Ellie M. C. Fanning, Executive Director efanning@ prspurpose.org 713-808-1988

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A BIG THANK YOU To Our Past Presidents

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2019-2020

2018-2019

2017-2018

2016-2017

Dan Kierce RBC Community Investments

Debra Guerrero The NRP Group, LLC

K. Nicole Asarch Rock Real Estate, Ltd./ Staffable Africa

Bobby Bowling Tropicana Building Corp.

2015-2016

2014-2015

2013-2014

2012-2013

Mahesh Aiyer Citi Community Capital

Justin MacDonald MacDonald Companies

George Littlejohn Novogradac & Company, LLP

Barry Kahn Hettig-Kahn Development Co.

2011-2012

2010-2011

2009-2010

2008-2009

Antoinette M. “Toni” Jackson The Banks Firm

Dan Markson The NRP Group, LLC

Linda McMahon Neighborhood Strategies, LLC

Mike Sugrue Stoneleaf Companies

2007-2008

2006-2007

2005-2006

2004-2005

Mike Clark Alpha-Barnes Real Estate Services

Granger MacDonald MacDonald Companies

Diana McIver DMA Development Co., LLC

Jerry Wright Dougherty & Company, LLC

2003-2004

2002-2003

2001-2002

2000-2001

Mike Lankford Mike Lankford Interests, LLC

Chris Bergman TCR Affordable Housing, Inc.

JOT Couch Texas Inter-Faith Supportive Services

Sally Gaskin SGI Ventures, Inc.

1999-2000

1998-1999

Dick Kilday Kilday Realty Corp

Edwina Carrington CHK Enterprise, LLC

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WE KNOW TEXAS CLOSED BROKERAGE

128

21,566

$

PROPERTIES

UNITS

VOLUME

DEBT ORIGINATION

1.02B

46

8,110

$

PROPERTIES

UNITS

VOLUME

VALUATIONS

945

149,404

PROPERTIES

UNITS

506M

At CBRE Affordable Housing, our high volume of valuations, sales, and lending transactions enable us to leverage real-time buyer, seller, and capital intelligence to provide our clients the most useful affordable housing market insights in Texas and nationwide. How can we help transform your real estate investments into real advantage?

Current Listings Brokerage Sale Financing

+1 206 826 5800 | cbre.us/affordablehousing

BUILDING A BETTER FUTURE STARTS WITH A STRONG FOUNDATION. Everyone deserves a place to call home.

In these challenging economic times, Regions Affordable Housing is still committed to investing in people and communities across the nation. Regions Affordable Housing has originated $5.8 billion in equity investments in 1,200 assets located in 45 states, D.C. and Puerto Rico and provided more than $1 billion in construction finance for LIHTC projects. With more than 30 years of industry experience, we value and reward long-term client relationships. Regions Affordable Housing is committed to providing our clients with a full-service banking relationship throughout the entire project life cycle.

Contact Regions Affordable Housing for customized solutions: Rachel Thomas-Phillips | rachel.thomas-phillips@regions.com Contact Regions Real Estate Capital Markets for permanent debt solutions: Graham Dozier | graham.dozier@regions.com regions.com/realestatebanking LIHTC & Historic Tax Credit Equity (Federal and State) | Construction Loans | Equity Bridge Loans | FHA/HUD & Fannie Mae DUS Lender | Treasury Management & Depository Services | Derivatives & Institutional Trustee Services Š 2020 Regions Bank. All loans and lines of credit are subject to credit approval, terms and conditions. | Regions and the Regions logo are registered trademarks of Regions Bank. The LifeGreen color is a trademark of Regions Bank.

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WASHINGTON WIRE

COMMUNITY DEVELOPMENT TAX INCENTIVES POISED TO SPUR COVID19 RECOVERY

By Michael J. Novogradac, CPA, Novogradac

The affordable housing, community development, historic renovation and renewable energy communities have been damaged directly and indirectly by the coronavirus, yet are also uniquely poised to be play a key role in a COVID-19 recovery. This article addresses some of the impact of the coronavirus on the communities we cover and the role they can play to help spur a COVID-19 recovery.

The health and economic wreckage from the COVID-19 pandemic has provoked a variety of government policy reactions, with more most certainly to come.

Initial legislation to address the impact of COVID-19 was quick, with the passage of the Coronavirus

Preparedness and Response Supplemental Appropriations Act (H.R. 6074), the Families First Coronavirus Response Act (H.R. 6201) and the Coronavirus Aid, Relief and Economic Security (CARES) Act (H.R. 748)–all coming in a 21-day period in March. As this article went to press, legislators were finishing up an interim piece of COVID-19 legislation that would replenish funding of Small Business Administration programs created or modified by the CARES Act and were working on a potential fourth phase of legislation that could include a variety of community development and affordable housing incentives. Legislation beyond the fourth phase is also possible.

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he COVID-19 pandemic is wreaking havoc across the nation and has brought an unprecedented shuttering of the United States economy as the entire American population has been under some form of social distancing, quarantine or isolation.

Bigger Pinch in Low-Income Communities The COVID-19 pandemic has had disproportionately devastating adverse health and financial consequences for low-income residents and communities. Tenants in low-income housing tax credit (LIHTC) and U.S. Department of Housing and Urban Development (HUD) financed properties are more likely to work in

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An obvious boost would be an increase in LIHTC allocation authority–perhaps a two-year 25 percent boost–to jump-start the production of more affordable housing.

jobs hit hardest by COVID-19: either those fields first hit by layoffs or in many service jobs considered “essential,” putting those workers at greater risk of illness.

Owners of LIHTC property (and other rental property) also face financial struggles. One provision of the CARES Act was a moratorium on eviction of tenants in many multifamily properties, including LIHTC developments. It was feared that the no-eviction provision, in combination with job losses, would lead to a significant decrease in rent collected beginning in April–a decrease that might continue until the moratorium is lifted. While the no-eviction provision was widely hailed, the CARES Act lacked sufficient provisions to help property owners address declines in rental income.

The CARES Act included a provision mandating debt payment forbearance for multifamily property owners with federally backed multifamily loans who experienced hardships due to COVID-19. That includes many LIHTC properties. However, forbearance isn’t forgiveness, it’s just a delay.

Property owners will be required to make up the payments missed during the pandemic. Furthermore, there are many other expenses associated with operating rental housing– such as property taxes, insurance, utility costs and maintenance–for which there was no relief provided.

There’s another major difficulty facing affordable housing: the effects the pandemic has had on the construction industry and related shutdowns. Even in areas where affordable housing construction continued, 70

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There are two principal ways the federal government can address damage caused by the COVID-19 pandemic and effects of the shutdown on community development tax incentives, and help spur an economic recovery. One is administrative, the other is legislative.

MICHAEL J. NOVOGRADAC, CPA

builders faced problems in getting materials, completing inspections and more. That is delaying construction and rehabilitation, which further extends the time before these properties will be available for low-income renters. Moreover, once constructed or renovated, it can be challenging to lease up apartments in the midst of shelter-in-place orders. Construction and lease-up delays can lead to unexpected shortfalls in equity financing, adding further financial stress to properties undergoing development. The pending recession will also likely adversely affect LIHTC equity pricing, which is the major source of financing for affordable rental housing.

Similarly, the construction of many properties financed by new markets tax credit (NMTC), historic tax credit (HTC) or renewable energy tax credit (RETC) equity, or opportunity zones (OZ) investment, has stalled or struggled with supply-chain and deadline issues in the early weeks of the COVID-19 shutdown. Those properties similarly face the additional burden of impending deadlines that may be difficult to meet and the possibility of a reduction in equity financing for tax credits or in the amounts invested in OZs.

Administrative Action To address the consequences of missed deadlines and other COVID-19-related delays, the Internal Revenue Service (IRS) must act. It has, to a degree. The IRS has the ability to extend various deadlines for up to 12 months, based on the federal government’s March 13 declaration of a national emergency. The IRS has done that, to a certain extent.

The OZ community received good news April 10 when the IRS ruled that any taxpayer whose 180-day period to invest in a qualified opportunity fund after a capital gains event ended on or after April 1 and before July 15 could use July 15 as the deadline. That was helpful, but many stakeholders sought a more flexible rule.

Meanwhile, there are other OZ deadlines for which extensions are needed: the 30-month substantial improvement period for property, the 12-month cure period for qualified OZ businesses that cause a qualified opportunity fund to fail the 90 percent investment standard and more.

The LIHTC community also received good news April 10 when the IRS similarly ruled that certain LIHTC deadlines were extended to July 15. That was moderately helpful, but stakeholders needed more expansive and

Photo Credit: Shutterstock comprehensive extensions. Also in April, based on existing IRS administrative guidance, many states began extending the LIHTC placed-in-service deadlines and the 10 percent test deadlines. That is a good start, but other deadlines (the 24-month period for minimum rehabilitation expenditures, the year-end deadline for restoration for buildings that suffer a casualty, etc.) could also be extended by the IRS, as could many of the property management regulation deadlines: those for physical inspections, tenant file reviews, tenant income recertifications and more.

For NMTC properties, the most important action the IRS could take involves extending deadlines that many community development entities–and their borrowers and investees–will struggle to meet due to COVID-19-related issues. Particularly helpful would be an extension to such requirements as the 12-month reasonable working capital safe harbor and the 12-month period for community development entities to deploy qualified equity investments.

HTC properties face either a 24- or 60-month deadline to meet substantial rehabilitation standards, deadlines that will be difficult to meet for some properties due to the pandemic. To be eligible to claim the HTCs in one year (under transition rule made after tax reform legislation required the HTC to be taken ratably over five years),

non-phased HTC properties face a June 20 deadline for substantial rehabilitation, with the property being placed in service by the end of 2020. An IRS extension for those deadlines is needed.

Both wind and solar projects need IRS guidance declaring that if they miss current deadlines due to the pandemic, they don’t lose tax credits. The solar investment tax credit (ITC) drops from 26 percent to 22 percent, while the wind production tax credit (PTC) goes from 60 percent to zero for properties that begin construction after Dec. 31, 2020. Pandemic-related construction delays could be devastating unless the IRS provides relief.

More LIHTCs would mean more construction to help stimulate the economy and would create more affordable housing–something in even greater demand after the pandemic economic fallout.

The IRS and state agencies should aggressively provide administrative relief.

Legislative Action Congress worked quickly on the first three COVID-19 bills. The first two focused on the immediate impact of the emergency and providing sick leave. The third– the $2.2 billion CARES Act–included provisions to mitigate the immediate impact of the outbreak.

More relief bills could be coming, starting with a so- called Phase 4 bill.

There was early talk from House Speaker Nancy Pelosi and President Donald Trump about an infrastructure focus on the Phase 4 legislation, talk that could lead to the inclusion of extra NMTC or LIHTC funding or an infrastructure tax credit. The infrastructure-as-focus talk faded, but could come back.

Photo Credit: Shutterstock

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A permanent minimum 4 percent LIHTC is the top ask of affordable housing advocates in COVID-19 relief and recovery legislation.

A minimum 4 percent rate is a simple way to put more dollars into affordable housing and make more affordable rental housing financially feasible.

A Phase 4, Phase 5 or even Phase 6 bill could include such items as a 4 percent floor for the LIHTC, a lowering of the 50 percent test for bond-financed affordable housing, emergency rental or operating assistance for LIHTC or other rental properties, an increase in annual LIHTC and NMTC allocations, extensions of ITC and PTC, and even an expansion of the OZ incentive.

An obvious boost would be an increase in LIHTC allocation authority–perhaps a twoyear 25 percent boost–to jump-start the production of more affordable housing. More LIHTCs would mean more construction to help stimulate the economy and would create more affordable housing–something in even greater demand after the pandemic economic fallout.

A permanent minimum 4 percent LIHTC is the top ask of affordable housing advocates in COVID-19 relief and recovery legislation.

The April rate was 3.12 percent, followed by May’s historic low of 3.08 percent, adding even greater urgency for Congress to act on a provision that already has bipartisan support from more than half of the House and nearly 40 percent of the Senate. A minimum 4 percent rate is a simple way to put more dollars into affordable housing and make more affordable rental housing financially feasible.

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Another option is to lower the financed-by threshold for tax-exempt private activity bonds–which are paired with 4 percent LIHTCs–from the current 50 percent of the aggregate basis to 25 percent. That change would increase the amount of affordable housing that could be built within the limits of existing bond volume authority.

An NMTC provision could be in recovery legislation. It’s possible that the 2019 round–due out this summer– could see an increase in allocation authority. The 2020 round, authorized for $5 billion in allocations, could see an increase. A multiyear or permanent extension of the NMTC isn’t off the table.

Provisions of the Historic Tax Credit Growth and Opportunity (HTC-GO) Act could be part of recovery legislation, including the elimination of the HTC basis adjustment requirement and a boost in the HTC percentage for smaller properties. Again, those legislative changes would encourage more development.

The PTC and ITC both are in their phasedowns, but legislation could extend or renew them to give those job-creating incentives a boost during a time of recovery–and as mentioned earlier, provide relief for properties that face a Dec. 31, 2020, deadline.

Congress has historically included community development and affordable housing incentives in recovery legislation. That should happen again.

What’s Next?

As the nation–and world–emerges from the unprecedented pandemic and collateral economic damage, there’s no template.

Presidential election years are historically difficult times to pass tax legislation, but, as noted in a previous Washington Wire, tax bills have passed in 10 of the past 11 presidential election years.

Community development and affordable housing stakeholders are poised to play a significant role in helping the nation recover. The use of tax incentives to encourage development in hard-hit areas has proven successful over the years and should be called upon again as we slowly emerge from the COVID-19 pandemic.

In a period of previously unimaginable difficulty, the LIHTC, NMTC, HTC, RETCs and OZ incentives are reliable contributors to recovery.

This article first appeared in the May 2020 issue of the Novogradac Journal of Tax Credits.

CORPORATE TRUST SERVICES As a long-standing member and partner of the Texas housing finance community, Amegy Bank is committed to serving the needs of Housing Finance Agencies and Authorities throughout the state by providing:

Johnnie Watson

Director of Multifamily Services Direct: 817-546-0160 Ext.141 Mobile: 817-819-2955 Fax: 817-546-0161

jwatson@foxenergyspecialists.com

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Local single point of contact for each relationship and transaction

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Trust officers who average more than 25 years of housing transaction experience

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Customized on-line reporting tools

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Corporate trust services provider for more than 100 years

For more information, please call: Mary Jane Henson, Senior Vice President (T) 713-232-6036 | maryjane.henson@amegybank.com For details about Corporate Trust services and locations, please visit: www.corporatetrust.zionsbank.com A Division of Zions Bancorporation, N.A. Member FDIC © 2020 Zions Bancorporation, N.A. All rights reserved

3301 West Freeway, Ft. Worth, TX 76107 www.FoxEnergySpecialists.com

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#taahpintoeducation

Prescribed Consulting For Affordable Housing Development

Fall 2020 WEBINARS We’re resourceful, experienced, creative problem solvers in affordable housing and financing. With a specialty in the Housing Tax Credit program and other state and federal funding sources, we guide our clients through the process in Texas while mitigating the bureaucracy. One of our proprietary GIS “viewer” mapping system facilitates the site selection process and structure a successful real estate transaction.

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www.taahp.org Sponsorship Opportunities Available to TAAHP Members.

2201 Northland Drive Austin, Texas 78756 contact Lora Myrick: lora@betcohousinglab.com (512) 785-3710 | betcohousinglab.com 74

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Call (512) 476-9901 or email info@taahp.org for information.

2020-2021

TDHCA Calendar SAVE THE DATES 2020-2021 TDHCA Board Meeting Dates (Subject to Change)

Thursday, October 8, 2020 Thursday, November 5, 2020 Thursday, December 10, 2020 Thursday, January 14, 2021 Thursday, February 11, 2021 Thursday, March 11, 2021 Thursday, April 8, 2021 Thursday, May 13, 2021 Thursday, June 17, 2021 Thursday, July 8, 2021 Thursday, July 29, 2021 Thursday, September 2, 2021 Thursday, October 14, 2021 Thursday, November 10, 2021 Thursday, December 9, 2021

Thank You, Texas Affordable Housing Providers!

TDHCA’s Governing Board, leadership, and staff extend our gratitude to all those who showed a willingness to work with Texas families at risk of losing their homes during the COVID-19 pandemic.

Your acts of kindness and measures of support are a testament to our shared mission - helping stabilize our most vulnerable.

Together our great State of Texas will recover, be stronger, and serve as a shining example of resiliency.

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D. Michael Boone, Jr., CPM Tel: 512-646-6700

Direct: 512-492-7022

BUILDING YOUR VISION

with PRIDE & EXCELLENCE When you work with Pavilion Construction, you’ll always benefit from an individualized approach, a high level of service and expertise that combines to build your vision into a reality.

PavilionConstruction.com © 2020 Pavilion Construction, LLC

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Fax: 512-646-6798

mike.boone@capstonemanagement.com

210 Barton Springs Road, Ste 300 Austin, TX 78704

www.capstonemanagement.com

Rental Housing:

Did you know?

The Federal Home Loan Bank of Dallas (FHLB Dallas) will offer Affordable Housing Program (AHP) grants of up to $750,000 each next year.

The AHP is a flexible source of funds which may be used with federal, state and local housing programs.

Application period opens in April 2021 Uses:

• Acquisition • Down payment and closing costs • Rehabilitation or new construction costs

*AHP funds must be used to benefit households with incomes at or below 80 percent of the median income for the area.

See fhlb.com/ahp to learn more.

WE HAVE TEXAS COVERED Headquartered in San Antonio, Galaxy is recognized as an industry leader for delivering affordable housing to communities throughout Texas. Our expertise allows us to work closely with owners, achieving requirements for scheduling and financing.

Associated General Contractors Outstanding Construction Awards 2020 | 2019 | 2018 | 2017 | 2014 | 2012 | 2010 SA Business Journal No. 2 Largest Minority Owned Businesses 2019

Fast Track Award 2017 - Rank 7

SA Business Journal Top 15 Fastest Growing Private Companies

www.galaxybuilders.com Luxury | Affordable Housing | Active Senior | Commercial | Renovation

Let’s build the future of housing, together.

The Carleton Management Services team is dedicated to achieving the financial goals of our owners by efficiently operating and maintaining their assets. We strive to control costs, drive revenue growth, and achieve operating goals while enhancing the lives of the residents we serve and the properties in which we operate.

817-532-3155

3301 Airport Freeway Ste. 210 Bedford TX, 76021

advisory. tax. assurance. | bakertilly.com

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T H A N K YO U

2020 TAAHP Suppo WE COULDN’T HAVE DONE IT WITHOUT YOU

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rters

In the era of a global pandemic, we are humbled by your continued support as we weather this storm. With your help, TAAHP can continue its mission to improve the quality and increase supply of affordable housing in Texas.

MANAGEMENT GROUP

HOUGHTALING LAW FIRM, LLC

Property Damage Attorneys Texas Louisiana North Carolina

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WITH A RELIABLE SOURCE FOR YOUR FINANCING NEEDS, YOU’RE

READY FOR TODAY. —

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PNC REAL ESTATE | As the largest syndicator of affordable rental housing in the country,* PNC Real Estate is an effective and proven provider of capital solutions throughout the cycle of your transaction — whether you are buying, building, preserving or refinancing. We offer LIHTC equity, balance sheet construction and permanent lending, as well as Fannie Mae, Freddie Mac and FHA solutions. When you work with a leading financial institution, you’re ready for today. To learn more, visit pnc.com/realestate.

REAL ESTATE BANKING | AGENCY FINANCE | TAX CREDIT SOLUTIONS MIDLAND LOAN SERVICES *National Multifamily Housing Council, 2020, Top 10 Syndicators for Affordable Housing

Bringing strategy, equity, and experience to historic building development

The nation’s leading consultants for historic tax credit rehabilitations with expertise in: • adaptive reuse • acquisition rehabilitation • public housing / RAD conversions

PNC, PNC Bank and Midland Loan Services are registered marks of The PNC Financial Services Group, Inc. (“PNC”).

PNC Bank, National Association (“PNC Bank”), and certain of its affiliates, including PNC TC, LLC, an SEC-registered investment advisor wholly-owned by PNC Bank, do business as PNC Real Estate. PNC Real Estate provides commercial real estate financing and related services. Through its Tax Credit Solutions segment, PNC Real Estate provides lending services, equity investments and equity investment services relating to Low Income Housing Tax Credit (“LIHTC”) investments. PNC TC, LLC provides investment advisory services to funds sponsored by PNC Real Estate for LIHTC investments. Registration with the SEC does not imply a certain level of skill or training. This material does not constitute an offer to sell or a solicitation of an offer to buy any investment product. PNC does not provide legal, tax or accounting advice unless, with respect to tax advice, PNC Bank has entered into a written tax services agreement.

Lending, leasing and equity products and services, as well as certain other banking products and services, require credit approval. ©2020 The PNC Financial Services Group, Inc. All rights reserved.

CIB RE 1705601-Aff Ad_3.625X5_io2_FINAL .indd 1

CIB RE PDF 0820-0129-1705601

For an initial consultation, contact Bill MacRostie.

202.567.6055 | bmacrostie@mac-ha.com WASHINGTON | BOSTON | CHICAGO CHARLESTON | HOUSTON | NEW ORLEANS | SAN JOSE

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#1 Freddie Mac Top Targeted Affordable Housing Lender in 2019

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#3 Fannie Mae DUS® Producer for Affordable Housing in 2019

Volume includes deals secured by Holliday Fenoglio Fowler LP or Holliday GP Corp. (“HFF”) prior to being acquired by JLL on July 1, 2019. HFF is now part of JLL. Agency/GSE lending and loan servicing are performed by Jones Lang LaSalle Multifamily, LLC, a wholly owned indirect subsidiary of Jones Lang LaSalle Incorporated. Loans made or arranged in California are pursuant to a California Financing Law license. © 2020 Jones Lang LaSalle IP, Inc. All rights reserved

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PROUD TO SUPPORT THE TEXAS HOUSING CONFERENCE AMTEX is a developer and builder serving Texas with high-quality apartment homes in multiple communities including the Dallas/Fort Worth metro area, Austin, Houston, Rockwall, Garland and others. We partner with Housing Authorities, Housing Financial Corporations and others to develop affordable, workforce and market-rate multifamily apartments. We have completed nearly 1,500 units since 2012, have 1,275 apartments in construction and have 1,608 more apartments in development.

Mark Morgan, Acquisitions Manager mmorgan@amcalhousing.com T: 818/706-0694 ext. 176 C: 909/720-4906

AMTEX Corporate Office 4101 McEwen Road, Suite 150 Dallas, Texas 75244 amcal.com/texas-communities

We’re investing in the future of our communities.

Being a good corporate citizen is a responsibility we take seriously. Our goal is to drive economic growth and job creation by providing mortgage and consumer loans, small business lending, philanthropy, and community development lending and investment.

To accomplish our goal, KeyBank’s National Community Benefits Plan calls for the investment of $16.5 billion over a five-year period in the communities we serve. It’s just one way we help local economies and people thrive.

Go to key.com/community to learn more about how KeyBank is helping our communities thrive.

All credit, loan and leasing products are subject to collateral and/or credit approval. SBA Preferred Lender.

Key.com is a federally registered service mark of KeyCorp. ©2020 KeyCorp. KeyBank is Member FDIC. 190104-521095-1145922825 key.com

Highridge Costa is among America’s leading developers, financiers, owners and operators of affordable workforce and senior apartment communities.

With over 28,000 units across 283 apartment communities developed and invested in, Highridge Costa brings tremendous development experience to the table and has formed strong relationships with institutional lenders and public-sector agencies alike. With an emphasis on continuity, the organization has retained its key leadership staff since inception and has a proven record of managing projects from early design through completion and beyond.

WWW.HOUSINGPARTNERS.COM

@HIGHRIDGECOSTA

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Proud to Support TAAHP The ITEX Group, and its vertically integrated afďŹ liated companies are devoted to multifamily real estate investment, development, construction, and property management. To date, ITEX has developed over 8,000 units, with total development costs in excess of $800 million and currently manages over 7,000 luxury and affordable apartment units. ITEX’s experience includes general, family, senior living, historic and affordable developments.

itexgrp.com

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Multifamily Housing | Healthcare Facilities Senior Housing

hcmD4.com

Who is CHR Partners?

Community Housing Resource Partners (CHR Partners) is a national nonprofit corporation founded in the belief that safe and affordable housing is the foundation of healthy communities. We provide support services and opportunities for low to moderate-income individuals and families as well as co-develop multifamily and single-family housing.

Measured Success Over the last 25 years, CHR has grown to serve over 13,000 individuals monthly in roughly 7500 permanent affordable housing units.

Our partnerships are created to maximize resources and achieve measurable success. Through meaningful collaborative efforts, CHR Partners addresses critical community needs in addition to participating as a driver of economic development for our neighborhoods.

“At CHR Partners, our success is rooted in our humancentered, people-first, and business-backed service model; Strong foundations build stronger lives.” –

Meghan Garza

President & CEO 2019 San Antonio Business Journal’s 40 Under 40 Woman of the Year

WWW.CHRPARTNERS.ORG

MAXIMIZE VALUE

You have a vision. And every decision…every deal… can get you closer.

CohnReznick’s advisory, assurance, and tax professionals serve affordable housing stakeholders with one of the most extensive and experienced industry practices in the United States.

Our partner-led teams help you meet your financial goals while addressing strict tax credit and other compliance requirements throughout your project’s life cycle.

Are you ready to achieve your vision?

Let’s get going.

Visit us at cohnreznick.com/ah