Charlotte allocates $25.8 million to finance 14 multifamily rental affordable housing projects

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Charlotte City Council on April 26 approved $25.8 million from the city’s Housing Trust Fund (HTF) to help finance 14 multifamily, rental affordable housing developments.

The developments could add as many as 1,422 affordable rental units for families, seniors and people experiencing homelessness in Charlotte. Of those units, 357, or 25%, will be targeted to households earning up to 30% of the Area Median Income (AMI). In Charlotte, a family of four would need a household income at or below $25,050 to qualify for affordable housing at the 30% AMI level.

The 14 developments were selected for meeting HTF criteria such as:

  • Developer experience in developing affordable, multifamily housing.
  • Ability to create mixed-income housing developments in areas of high opportunity.
  • Long-term affordability.
  • Ability to leverage available resources, such as HTF funds from the city; the Local Initiatives Support Corporation’s (LISC) Charlotte Housing Opportunity Investment Funds (CHOIF); public or private land; low-cost debt; project-based housing vouchers; and state and federal affordable housing financing.

Some of the developers submitted proposals that will entail securing Low-Income Housing Tax Credits (LIHTC) from the North Carolina Housing Finance Agency (NCHFA). These federal tax credits are awarded at 4% or 9% levels to experienced developers constructing new affordable housing developments or rehabilitating existing affordable housing developments. The awarded tax credit depends on the strength of the proposed developments and the developer’s ability to secure additional funding.

Seven of the 14 developments are requesting 9% LIHTC awards. These awards are very competitive and, due to limited availability, not all developers seeking a 9% tax credit will receive a tax credit allocation from the NCHFA. Historically, Charlotte has been awarded three or four 9% deals each year.

Five of the 14 developments are requesting 4% LIHTC awards from the NCHFA. If the developments receive 4% LIHTC awards, the developers will come back to the city for approval of a tax-exempt bond allocation from NCHFA.

The NCHFA will announce all LIHTC awards in August 2021. The NCHFA will base its final LIHTC awards on:

  • Market demand and local housing needs.
  • A project’s ability to serve qualified residents for the longest affordability period.
  • Design and quality of construction.
  • Financial structure and long-term viability.

Developments will be awarded HTF gap financing contingent upon receiving a LIHTC award. City funding approved for developments that do not receive the LIHTCs will be returned to the Housing Trust Fund for future allocation.

The remaining two developments will be financed with non-LIHTC financing.

The developments seeking 4% LIHTCs are:

  • Evoke Living at Morris Field, 3628 Morris Field Drive: CSE Communities and Opportunities South LLC are developing 132 units with rents ranging from $400 to $1,417 per month. The city’s investment would be $3 million.
  • Fairhaven Glen, 8329 Nations Ford Road: Commonwealth Development Corporation is developing 140 units with rents ranging from $365 to $1,330 per month. The city’s investment would be $2 million.
  • Grounds for Change, 3420 Park Road: DreamKey Partners Inc. and the YWCA are developing 104 units with rents ranging from $375 to $1,192 per month. The city’s investment would be $2 million.
  • Sugar Creek Apartments, 230 W. Sugar Creek Road: NRP Holdings LLC is developing 188 units with rents ranging from $395 to $1,803 per month. The city’s investment would be $3 million.
  • The Barton Seniors, 6000 Old Pineville Road: Blue Ridge Atlantic Development is developing 174 units for seniors. Rents range from $412 to $1,320 per month. The city’s investment would be $2 million.

The developments seeking 9% LIHTCs are:

  • Evoke Living at Eastland, 5601 Central Avenue: CSE Communities and Opportunities South LLC are developing 82 units for seniors with rents ranging from $400 to $1,417 per month. The city’s investment would be $1.6 million.
  • First Ward Place Phase I, 501 E. Eighth St.: Horizon Development Properties Inc. is rehabilitating 109 existing housing units with rents ranging from $465 to $1,500 per month. The city’s investment would be $2 million.
  • Fordham Place, 2570 Kingspark Drive: Surber Development & Consulting LLC is developing 70 units for seniors with rents ranging from $365 to $925 per month. The city’s investment would be $1.645 million.
  • Galloway Crossing, 8300 East W. T. Harris Blvd.: The Woda Group Inc. is developing 78 units for seniors with rents ranging from $361 to $1,360 per month. The city’s investment would be $1.56 million.
  • Guardian Angel Villa II, 13522 Guardian Angel Lane: Douglas Development is developing 93 units for seniors with rents ranging from $400 to $1,417 per month. The city’s investment would be $1.7 million.
  • Marvin Road Apartments, 3712 Marvin Road: DreamKey Partners Inc. is developing 70 units with rents ranging from $399 to $1,600. The city’s investment would be $1.7 million.
  • Ovata at Reedy Creek, 9729 Newell Hickory Grove Road: SCG Development Partners LLC is developing 78 units for seniors with rents ranging from $376 to $1,188 per month. The city’s investment would be $480,000.

Developers of two affordable housing projects have been approved for city funds but are not seeking LIHTCs. These include:

  • Easter’s Home Supportive Housing, 1615 E. Fifth St.: Caldwell Presbyterian and DreamKey Partners Inc. are developing 21 units of supportive housing for homeless people. Rent will be $972 per month. The city’s investment would be $630,000.
  • The River District, 8325 Dixie River Road: Laurel Street Residential is developing 124 units with rents ranging from $416 to $1,657 per month. The city’s investment would be $2.5 million.

All 14 developments include deed restrictions that would make units affordable for 30 years.

Developers seeking HTF dollars are required to serve households earning 80% or below the AMI. Additionally, at least 20% of the total units must serve households at 30% of AMI.

The city and LISC received 16 proposals from developers seeking various types of gap financing support, including 9% and 4% tax credits from NCHFA, allocations from the CHOIF, and low-cost debt. One of the proposals sought only CHOIF support, and one of the proposals was withdrawn by the developer.

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