For Immediate Release - Closing of HUD Phase II RAD Conversion
TEXARKANA PUBLIC FACILITY CORPORATION ASSISTS HOUSING AUTHORITY OF THE CITY OF TEXARKANA, TEXAS WITH THE CLOSING OF $34.68 MILLION RAD PHASE II CONVERSION
Strategic financing preserves a combined total of 294 affordable housing units for this phase.
Texarkana, TX June 18, 2019 – Texarkana Public Facility Corporation (TPFC) a local leader in affordable housing consulting, has successfully assisted the Housing Authority of the City of Texarkana, Texas (HATT) with the closing of their HUD Phase II RAD Conversion. The five - project, $34.68 million recapitalization effort will enable the HATT to rehabilitate and preserve the remaining 294 affordable housing units in Texarkana, Texas henceforth eliminating their Low-Income Public Housing Program (LIPH).
The Rental Assistance Demonstrations (RAD) program seeks to address the outstanding capital needs of public housing developments and to preserve those developments as a long-term source of affordable housing. In its simplest form, it allows Public Housing Authorities access to private debt and equity to rehabilitate these projects. Properties converting to RAD receive a long-term Section-8 contract.
Financing for the project consists of $10.79 million in tax credit equity through the purchase of 4% low income housing tax credits (LIHTC) by Hunt Capital Partners, LLC; Citi Community Capital through a private placement purchased $20 million in private-activity bonds issued by the Authority, of which $11 million will remain outstanding as long-term permanent debt; the Authority also provided $11.02 million in seller and subordinate financing.
The HATT provided financial and development services to the partnership with technical assistance by the Boulevard Group & Purple Martin Real Estate including overall deal structuring acquisition due diligence, financial underwriting, third-party procurement, renovation scope and budget analysis for the $34.68 million total development cost renovation, lender and investor procurement and negotiations, funding applications, project operating analysis, lender and investor due diligence, bond and equity document review, construction draw processing and budget tracking during construction, as well as work related to project close-out and cost certification. Coats Rose Affordable Housing and Community Development attorneys represented the HATT as partnership and bond counsel throughout the entire transaction.
This closing will complete a major milestone in the portfolio-wide efforts to the conversion of all its LIPH units and will change the business model of the HATT henceforth. In 2017, Through TPFC, the HATT converted 98 LIPH units within the Authority’s existing tax credit portfolio among the TPFC executed HOPE VI communities to the RAD program.
William Teschke, Director, Project Management stated: “HCP is proud to partner with the Housing Authority of Texarkana, Texas on this landmark rehabilitation project. With this RAD conversion, HATT is able to recapitalize and renovate all of its remaining public housing units at once, ensuring that these five developments will continue to provide quality housing for decades to come. We look forward to seeing the impact the project will have on the lives of the 294 tenant households, and also the ripple effect it will have on the broader community of Texarkana.”
“Citi Community Capital is proud to provide financing for HATT to re-develop much needed housing in Texarkana, Texas,” said Mahesh Aiyer, Director, Citi. “The re-development will positively impact the local community for many years to come and we are grateful to be a part of HATT’s efforts.”
“This is a tremendous achievement for the Housing Authority of the City of Texarkana. We are proud to be part of their team,” said Barry Palmer, head of the Coats Rose Affordable Housing and Community Development practice group.
Antonio Williams, CEO of HATT, expressed his excitement at the latest milestone in HATT’s revitalization strategy and signaled his desire to continue to pursue new and innovative affordable housing solutions both in Texarkana and beyond. “I would like to thank my HATT team and our development partners in the successful closing of this transaction, which will both ensure the revitalization of the physical structures involved as well as improve quality of life for the families who live in our great city,” shared Williams.
About the Housing Authority of the City of Texarkana, Texas The Housing Authority of the City of Texarkana, Texas (HATT) is a public housing agency providing decent, safe, affordable housing for eligible low-income families, the elderly, and persons with disabilities. HATT manages several funded programs and has subsidized affordable housing units for rental assistance. The Housing Authority of the City of Texarkana, Texas currently offers low rent units and Section 8 Vouchers with a waiting list and landlord information. Supportive services include community involvement, modernization, homeownership promotion, and employment opportunities.
Additional HATT entities include:
Texarkana Public Facility Corporation (TPFC) is an instrumentality of the HATT that was created for purposes of implementing public housing, other affordable housing development activities programs, and other services.
Premier Texarkana Development and Management Facility Corporation dba/ as Premier Texarkana D&MFC (Premier) was created to provide for the acquisition, construction, rehabilitation, renovation, repair, equipping, furnishing, and placement in service of public facilities in an orderly, planned manner and at the lowest possible borrowing costs. Premier is also an instrumentality that is authorized to issue bonds on behalf of its sponsors for the purposes of Section 103, Internal Revenue Code of 1986 (26 U.S.C. Section 103) and participate in PFC Development Deals on a state-wide basis.
Prime Impact Solutions, Inc., a 501c3 non-profit instrumentality was created to transform the world of affordable housing. There is a serious affordable housing crisis. Communities across this country are facing low-income housing shortages. Recent statistics provides that there is not a single county in the United States that can fill 100% of its low-wealth population’s need for safe, affordable housing. Prime Impact Solutions, Inc. will continue its efforts to address the needs of low-wealth individuals and families in Texarkana, Texas and the surrounding areas by accessing and leveraging available grants and other philanthropic resources to positively affect change in this need.