News - 2008
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080493
RED Provides $18 Million LIHTC Equity for Acquisition/Rehabilitation Portfolio of Eight Seniors Properties, Including One New Construction
Keystone Place Apts
Dickson City, PA
Columbus, OH, August 25, 2008 – Red Capital Markets, Inc. (MEMBER FINRA/SIPC), the investment banking arm of comprehensive capital provider RED CAPITAL GROUP, recently syndicated $18,049,000 in low income housing tax credits ("LIHTC") to finance the acquisition and rehabilitation of eight seniors multifamily properties, including the construction of a new building containing 24 units at one of the acquired properties. All of the properties are situated in the Scranton/Wilkes-Barre region of Pennsylvania (the "Portfolio").
The Portfolio primarily consists of properties that were originally constructed in the early 1980’s with HUD 202 financing. Typical unit amenities throughout the Portfolio include range/oven, refrigerator, and air-conditioning. The Portfolio consists of 587 total units, of which 583 units are for-rent units and four are employee units. Each property is supported by a project-based Housing Assistance Payments contract ("HAP") which provides rental subsidy for the 583 for-rent units in the Portfolio. Of those units, approximately 18 units will be set-aside for seniors households at or below 80% of Area Median Income ("AMI"). The other 565 units are expected to participate in the LIHTC program, with 532 and 33 units reserved for seniors households at or below 60% and 20% AMI, respectively.
The Portfolio is sponsored by Urban Innovations, Ltd. ("Urban Innovations"), a for-profit real estate firm based in Chicago, Illinois. Urban Innovations is a sophisticated development, construction, and management firm with significant expertise in HUD-supported seniors housing. This is the seventeenth overall transaction sponsored by Urban Innovations and financed by affiliates of RED CAPITAL GROUP.
Andrew W. Delman, a principal at Urban Innovations, said, "Although this was not our largest transaction, it was our most difficult one to date. We acquired such a large portfolio in such an uncertain economic time. Given the uncertainty of the general lending community, along with rapid fluctuations in the overall credit markets, we required the patience and expertise of a truly sophisticated capital source such as Red Capital. There were so many obstacles to overcome in getting this transaction closed and, as in every past deal as well, Red was great to work with from start to finish. Their knowledge of this field is superb, their commitment, as we worked through the many difficult issues which arose, was appreciated and, as we knew they would, they came through in the end to help us preserve and improve each of these affordable senior housing projects."
Steven M. Greenbaum, a principal at Urban Innovations, commented, "Our faith in Red Capital helped give us the confidence we needed to close extremely complex and difficult transactions even in uncertain economic times. The strong relationship that we have developed with Red over the course of many transactions allows us to focus more energy on our mission of preserving and improving affordable housing around the country."
Linden Crest Apts
Clarks Summit, PA
