MIXED-INCOME HOUSING PANEL

Transcription

1 MIXED-INCOME HOUSING PANEL CCAH FALL CONFERENCE NOVEMBER 9, 2017

2 CFY DEVELOPMENT Vertically-Integrated Affordable Housing Development Company o Developer o General Contractor o Property Manager Cyrus Youssefi, President/CEO 33+ Years Experience Ali Youssefi, Vice President 11+ Years Experience

3 LOW INCOME HOUSING TAX CREDITS Created within Section 42 of IRS code in 1986 Most important resource for creating affordable housing in the United States 2.6 million housing units placed in service between 1987 and 2013

4 LOW INCOME HOUSING TAX CREDITS LIHTC PROJECTS Utilize 9% or 4% Tax Credits Typically 100% Affordable Target different demographic groups: Senior Housing, SRO (Single-Room Occupancy) Housing, Large-Family Housing, etc

5 Globe Mills, Sacramento, CA CTCAC HOUSING TYPE: Senior SIZE: 143 units; 129,972 square feet COMPLETED: 2008 COST: $38 million

6 Ridgeway Studios, Sacramento, CA CTCAC HOUSING TYPE: SRO SIZE: 22 units; 13,200 square feet COMPLETED: 2014 COST: $7.2 million

7 Juniper Apartments, Manteca CA CTCAC HOUSING TYPE: Large Family SIZE: 153 units; 174,050 square feet COMPLETED: 2012 COST: $28.9 million

8 WHAT IS MIXED-INCOME HOUSING? US Department of Housing and Urban Development (HUD): A mixed-income housing development can be defined as a development that is comprised of housing units with differing levels of affordability, typically with some market-rate housing and some housing that is available to low-income occupants below market-rate.

9 WHY MIXED-INCOME HOUSING? It diversifies communities! MKT RATE MKT RATE < < MKT RATE AFFORD. MIXED MIXED AFFORD. AFFORD.

10 WHY MIXED-INCOME HOUSING? Increased tolerance for socio-economic diversity Access to better amenities and services for the lowincome tenants (both in building and neighborhood) Higher quality housing Safer neighborhoods Increased property values Greater community support (less NIMBYism)

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12 CASE STUDIES SACRAMENTO, CA

13 SACRAMENTO COUNTY 2017 INCOME AND RENT LIMITS 30% AMI 40% AMI 50% AMI 60%AMI 80%AMI 100%AMI 120% AMI 1 PERSON $15,600 $20,800 $26,000 $31,200 $36,160 $52,000 $62,400 30% AMI 40% AMI 50% AMI 60%AMI 80%AMI 100%AMI 120% AMI STUDIO $390 $520 $650 $780 $1,020 $1,300 $1,560 1-BDRM $417 $557 $696 $835 $1,114 $1,392 $1,670 2-BDRM $501 $668 $835 $1,002 $1,336 $1,670 $2,004 3-BDRM $579 $772 $965 $1,158 $1,444 $1,930 $2,316

14 700 BLOCK OF K STREET

15 700 BLOCK OBJECTIVE Develop a mixed-use, mixed-income, transit oriented development

16 PROJECT SUMMARY apartments (60% affordable, 40% market rate) - 70,000 SF of commercial/retail space

17 PERMANENT FUNDING SOURCES Cornerstone Perm Loan (TE BOND) $13,169,000 Land Contribution (City) $1 City/Redevelopment Agency Loans $11,500,000 GP Loan $1,500,000 Deferred Developer Fee $1,250,000 GP Equity $600,000 Limited Partner Equity (4% Tax Credits) $8,889,290

18 700 BLOCK OF K STREET UNIT MIX AND RENT LEVELS % AMI % AMI - 53 unrestricted units 30% AMI 40% AMI 50% AMI 60%AMI 80%AMI 100%AMI 120% AMI 1 PERSON $15,600 $20,800 $26,000 $31,200 $36,160 $52,000 $62,400 30% AMI 40% AMI 50% AMI 60%AMI 80%AMI 100%AMI 120% AMI STUDIO $390 $520 $650 $780 $1,020 $1,300 $1,560 1-BDRM $417 $557 $696 $835 $1,114 $1,392 $1,670 2-BDRM $501 $668 $835 $1,002 $1,336 $1,670 $2,004 3-BDRM $579 $772 $965 $1,158 $1,444 $1,930 $2,316

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21 WAREHOUSE ARTIST LOFTS

22 WAL OBJECTIVE Develop a mixed-use, mixedincome, transit oriented development

23 PROJECT SUMMARY apartments (75% affordable, 25% market rate) SF of commercial/retail space

24 PERMANENT FUNDING SOURCES CCRC Perm Loan $6,400,000 CA State HCD Prop IC Funds $4,960,000 CADA/Agency Loans $6,000,000 Deferred Developer Fee $1,200,000 LP Equity (9% Tax Credits) $19,650,000 Limited Partner Equity (Historic TC) $3,000,000

25 WAL UNIT MIX AND RENT LEVELS % AMI % AMI % AMI % AMI - 30 unrestricted units 30% AMI 40% AMI 50% AMI 60%AMI 80%AMI 100%AMI 120% AMI 1 PERSON $15,600 $20,800 $26,000 $31,200 $36,160 $52,000 $62,400 30% AMI 40% AMI 50% AMI 60%AMI 80%AMI 100%AMI 120% AMI STUDIO $390 $520 $650 $780 $1,020 $1,300 $1,560 1-BDRM $417 $557 $696 $835 $1,114 $1,392 $1,670 2-BDRM $501 $668 $835 $1,002 $1,336 $1,670 $2,004 3-BDRM $579 $772 $965 $1,158 $1,444 $1,930 $2,316

26 800 BLOCK OF K STREET

27 800 BLOCK OBJECTIVE Develop a mixed-use, mixed-income, transit oriented development post- redevelopment

28 PROJECT SUMMARY apartments (70% market, 30% affordable) SF of commercial/retail space

29 PERMANENT FUNDING SOURCES CalHFA Perm Loan $55,130,430 CalHFA Subsidy Loan $1,800,000 Deferred Developer Fee $3,102,813 Limited Partner Equity (4% LIHTC) $3,311,928 GP Equity $6,000,000 TOTAL DEVELOPMENT BUDGET $69,345,171

30 800 BLOCK UNIT MIX AND RENT LEVELS % AMI Moderate-Rate % AMI unrestricted units 30% AMI 40% AMI 50% AMI 60%AMI 80%AMI 100%AMI 120% AMI 1 PERSON $15,600 $20,800 $26,000 $31,200 $36,160 $52,000 $62,400 30% AMI 40% AMI 50% AMI 60%AMI 80%AMI 100%AMI 120% AMI STUDIO $390 $520 $650 $780 $1,020 $1,300 $1,560 1-BDRM $417 $557 $696 $835 $1,114 $1,392 $1,670 2-BDRM $501 $668 $835 $1,002 $1,336 $1,670 $2,004 3-BDRM $579 $772 $965 $1,158 $1,444 $1,930 $2,316

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33 1717 S STREET

34 1717 S STREET OBJECTIVE Develop a mixed-use, mixed-income, transit oriented development post- redevelopment

35 PROJECT SUMMARY apartments (60% market, 40% affordable) SF of commercial/retail space

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37 1717 S ST UNIT MIX AND RENT LEVELS % AMI Moderate-Rate % AMI - 95 unrestricted units 30% AMI 40% AMI 50% AMI 60%AMI 80%AMI 100%AMI 120% AMI 1 PERSON $15,600 $20,800 $26,000 $31,200 $36,160 $52,000 $62,400 30% AMI 40% AMI 50% AMI 60%AMI 80%AMI 100%AMI 120% AMI STUDIO $390 $520 $650 $780 $1,020 $1,300 $1,560 1-BDRM $417 $557 $696 $835 $1,114 $1,392 $1,670 2-BDRM $501 $668 $835 $1,002 $1,336 $1,670 $2,004 3-BDRM $579 $772 $965 $1,158 $1,444 $1,930 $2,316

38 MIXED-INCOME DEVELOPMENT LESSONS LEARNED

39 SACRAMENTO COUNTY 2017 INCOME AND RENT LIMITS LOW-INCOME HOUSING TAX CREDITS MISSING MIDDLE 30% AMI 40% AMI 50% AMI 60%AMI 80%AMI 100%AMI 120% AMI 1 PERSON $15,600 $20,800 $26,000 $31,200 $36,160 $52,000 $62,400 30% AMI 40% AMI 50% AMI 60%AMI 80%AMI 100%AMI 120% AMI STUDIO $390 $520 $650 $780 $1,020 $1,300 $1,560 1-BDRM $417 $557 $696 $835 $1,114 $1,392 $1,670 2-BDRM $501 $668 $835 $1,002 $1,336 $1,670 $2,004 3-BDRM $579 $772 $965 $1,158 $1,444 $1,930 $2,316

40 100% AFFORDABLE VS MIXED-INCOME DEVELOPMENT Assumption: Need $100,000 to $150,000 per unit in gap financing to finance affordable housing in Sacramento (700 Block of K Street: approximately $136,000 per unit) Result:150 units of new affordable housing requires $15,000,000 to $22,500,000 in gap financing

41 100% AFFORDABLE VS MIXED-INCOME DEVELOPMENT Hypothesis: $15,000,000 in Gap Financing can build VS 150 UNITS 750 UNITS: 150 AFFORDABLE UNITS MARKET RATE UNITS

42 CFY S MIXED-INCOME DEVELOPMENTS WAL 700 BLOCK 800 BLOCK 1717 S ST (75% Aff, 25% Mkt) (60% Aff, 40% Mkt) (20% Low, 10% Mod, 70% Mkt) (20% Low, 20% Mod, 60% Mkt)

43 FUNDING MIXED-INCOME HOUSING & THE MISSING MIDDLE - Allow for a wider range of Income Levels to be targeted with the use of affordable housing funds. Local and State funding programs typically target the lowest income levels - Increase resources available to the State s Finance Agency (CALHFA) - Promote Mixed-Income development, rather than incentivizing housing to be built in affordable, moderate rate and market rate silos - Case Study: 800 Block likely could not be funded as designed if it was 100% affordable or 100% market rate - Increase participation by affordable housing Tax Credit investors