News - 2008
071026
RED Provides Tax Credit Equity, FHA Bond Enhancement & Bond Underwriting for California Property
Acquisition and Renovation of Section 8-Assisted HUD 236 Facility Preserves Housing for the Elderly
Casa de los Amigos
Redondo Beach, California
Columbus, OH, December 13, 2007 – Red Capital Markets, Inc. (MEMBER FINRA/SIPC), the investment banking entity of comprehensive capital provider RED CAPITAL GROUP, and Red Mortgage Capital, Inc., a top ten FHA and Fannie Mae mortgage lender, provided a creative financing package for an existing seniors housing community in California. The sponsor of the property is the Los Angeles-based not-for-profit Episcopal Housing Alliance ("EHA").
Casa de los Amigos, located in Redondo Beach, California, approximately 23 miles southeast of downtown Los Angeles and one block from the Pacific Ocean, consists of one 4-story elevator building with 136 one-bedroom seniors units. EHA approached RED to create a custom financing package to aid in their mission to preserve the HUD assisted senior housing community. As a result of the financing, the property will utilize approximately $18,000 per unit for improvements consisting of a new solar water heating system, re-roofing and flashing, unit ventilation systems upgrades, window replacements, lobby tile replacements, surveillance cameras, new hallway lighting, and new ranges and refrigerators, to name a few.
As part of the comprehensive transaction, Red Capital Markets, Inc. syndicated over $4.5 million of low income housing tax credit equity and acted as underwriter and placement agent for $7,395,000 of tax-exempt bonds issued by the California Statewide Communities Development Authority and $885,000 of subordinated tax-exempt bonds purchased by Red Capital Community Development Company, LLC. Red Mortgage Capital, Inc. provided a 35 year fully amortizing FHA Section 223(f) credit enhancement to support the $7,395,000 senior tax exempt bond issue.
Joe Colletti, Ph.D., Executive Director of Episcopal Housing Alliance said, "The preservation of affordable rental housing units in Southern California is an extremely difficult undertaking. Therefore, I am glad that we had a financial partner with the resources, persistence and experience of Red Capital Group to help us complete this transaction."
Richard R. Andrews, Managing Director of Red Mortgage Capital, Inc. said, "This is our second transaction with Episcopal Housing Alliance. Both transactions involved complex structures and on both occasions they have shown the dedication and skill necessary to manage the many pieces which must be integrated to successfully complete the transaction."
