Predevelopment

NC’s Predevelopment Loan product is aimed at providing NWOs with critical and flexible funds needed to conduct early stage due diligence. Funds are typically used for environmental studies, market studies, appraisals, architectural and engineering expenses, legal fees, working capital and earnest money deposits. Pre-development loan amounts can be up to $500,000 with a maximum loan term of 36 months. The interest rate is 4.50% (fixed), with interest only payments. Loans are unsecured and made on a recourse basis to the borrower. This product has been especially beneficial to small and rural NWOs who have limited access to local or organizational resources.

Community Preservation and Development Corporation for Randle Hill Apartments

Location: Washington, DC

Loan Amount: $650,000

Loan Type: Predevelopment

Project Description: This predevelopment loan will cover expenses incurred in the preservation of Randle Hill Apartments, a 196-unit development in the Congress Heights neighborhood of Washington DC. CPDC acquired the property in December 2016, and is applying for and allocation of 4% LIHTC and tax exempt bonds from the Washington DC Housing Finance Agency. This project will improve an older apartment property in a transitioning area of Washington DC, and provide affordable homes to both low-income families and moderate-income families, as only 80% of the apartments will be subject to rent restrictions. This will reduce displacement of households earning more than 60% AMI but are long-time community residents.

HAP Housing (HAP) for 188 Fuller Street

Location: Ludlow, MA

Loan Amount: $400,000

Loan Type: Predevelopment

Project Description: This is NC’s first loan request from HAP Housing (HAP). HAP requested $400,000 to cover predevelopment costs for 188 Fuller Street, a proposed 42-unit low income housing tax credit (LIHTC) apartment project in Ludlow, MA. During the term of the loan, HAP will be applying for project financing including LIHTC and conventional and soft debt. The loan funds will be used to assist with predevelopment expenses until construction closing. The project will include a mixture of 1-, 2-, and 3 bedroom units, and it will target households with incomes ranging from 30% to 60% of Area Median Household Income. There will be 10 1-bedroom/1-bathroom units, 20 2-bedroom/1-bathroom units and 12 3-bedroom/2 bathroom units in four or more buildings.

Summit Park Renderings

Mutual Housing Association of Greater Hartford for Summit Park II

Location: Hartford, CT

Loan Amount: $500,000

Loan Type: Predevelopment

Project Description: This is NC’s sixth loan request from MHA of Greater Hartford (MHAGH) of $500,000 to help with predevelopment costs for Summit Park II, a proposed scattered-site 62-unit low income housing tax credit (LIHTC) apartment project on two sites that MHAGH has under contract in Hartford, CT. One of the sites has an operating property for which the second site consists of two adjacent parcels – one is vacant and one has an abandoned building on it that will be demolished. LISC is providing acquisition financing for this second site. The project will include a mixture of 1-, 2-, and 3 bedroom units, and it will target households with incomes ranging from 30% to 60% of Area Median Household Income.

Photos of Homes

HomeSight for CDFI Bridge Line of Credit

Location: Seattle, WA

Loan Amount: $400,000

Loan Type: Predevelopment

Project Description: This is HomeSight’s 2nd loan with NeighborWorks Capital. HomeSight has requested a predevelopment loan of $400,000 to be used to provide liquidity to HomeSight as it ramps up its single family mortgage lending program. This is NC’s second loan to HomeSight. The primary source of repayment is the sale of the mortgages originated with NC proceeds to another lender. This is a new endeavor for HomeSight and NC was willing to make this loan due to their successful sale of 11 loans to date.

Fallsburg Site Plan Drawing

RUPCO for Fallsburg Replacement Housing Project

Location: Fallsburg, NY

Loan Amount: $400,000

Loan Type: Predevelopment

Project Description: This is NC’s second loan to a project sponsored by RUPCO for an initiative in the rural town of Fallsburg, New York to replace 10 dilapidated scattered-site manufactured homes. The proceeds of the loan will be used to bridge committed project funding from HOME and New York State Affordable Housing Corporation that is available to be drawn on a reimbursable basis. The replacement units and site work will be provided by a local manufactured home dealer, and administration and supervision of the project will be provided by RUPCO.

Atando Apartment Photo

Charlotte Mecklenburg Housing Partnership (The Housing Partnership) for Atando Apartments

Location: Charlotte, NC

Loan Amount: $400,000

Loan Type: Predevelopment

Project Description: This is NC’s 10th loan with Charlotte Mecklenburg Housing Partnership (The Housing Partnership). The Housing Partnership is requesting a $400,000 predevelopment loan from NC to complete predevelopment activities for the construction of Atando Apartments, a 130- unit general occupancy rental apartment project to be built at CMHP’s Brightwalk development. This is the final affordable housing project for this master plan redevelopment project. The project has been awarded a $10 million bond allocation and 4% LIHTC, NC’s source of repayment. The property will include four three- story apartment buildings of which one building will incorporate the 3,100 square foot clubhouse and have 79 three-bedroom and 51 two-bedroom units, all with two full baths. Of these units, five of the two-bedroom and eight of the three-bedroom units will have restricted rents amounting to 50% of the Mecklenburg County area median income (AMI). In addition, 46 of the two-bedroom units and 71-of the three-bedroom units will have rents at 60% of AMI.

Silver Star Apartments Photo

A Community of Friends for Silver Star Apartments

Location: Los Angeles, CA

Loan Amount: $400,000

Loan Type: Predevelopment

Project Description: The is NC’s second loan to A Community of Friends (ACOF) who closed on a $400,000 predevelopment loan for predevelopment costs related to its new construction project known at Silver Star Apartments. The project will be 49 units of permanent supportive housing community for homeless veterans located in the Hyde Park neighborhood of Los Angeles. Separately, NC approved a $2,000,000 interim development loan for the Huntington Square project for land acquisition. This planned construction of a mixed-use project consisting of 55 units of affordable special needs rental housing and 10,000 square feet of commercial/retail space will be located in Huntington Park, California. ACOF’s focus is to build housing for people who earn less than 30% of area median income (AMI) and have a mental, physical, or developmental disability. It works to provide people with special needs safe and affordable homes that allow them to focus on their mental and physical health. ACOF currently houses over 2,000 individuals and families in its buildings. 99% of ACOF’s special needs residents have a mental health, substance abuse, or a physical disability and over 95% have remained housed after one year with another 69% housed after three years.

Barrett Plaza Photo

Community Housing Development Corporation for Barrett Plaza & Barrett Terrace

Location: Richmond, CA

Loan Amount: $600,000

Loan Type: Predevelopment

Project Description: This is NeighborWorks Capital’s (NC) first loans to Community Housing Development Corporation of North Richmond (CHDC). NC’s predevelopment loans were made to complete predevelopment activities for the recapitalization and preservation of two affordable rental properties owned by CHDC located in Richmond, California: Barrett Terrace and Barrett Plaza. Barrett Plaza Townhomes is a 58-unit general occupancy rental apartment complex built in 1979 in Richmond, California. The property receives rental subsidies from a recently renewed 20-year Section-8 Housing Assistance Payment (HAP) contract. The complex has been well maintained, but is in need of capital improvements which CHDC will undertake as part of a recapitalization of the project using tax exempt bonds and 4% Low Income Housing Tax Credits. NC’s $300,000 predevelopment loan enabled CHDC to complete the necessary predevelopment activities to secure financing for the recapitalization. Barrett Terrace Apartments is a 115-unit general occupancy rental apartment complex built in 1975 in Richmond, California. The property receives operating subsidies through a recently renewed 20-year Section-8 HAP contract. The complex has been well maintained, but is in need of capital improvements which CHDC will undertake as part of a recapitalization of the project also using tax exempt bonds and 4% Low Income Housing Tax Credits. NC’s $300,000 predevelopment loan will also enable CHDC to complete the necessary predevelopment activities to secure financing for the recapitalization.

West Broadway Villas

PathStone for West Broadway Villas

Location: Monticello, NY

Loan Amount: $250,000

Loan Type: Predevelopment

Project Description: First-time borrower PathStone will use a $250,000 predevelopment loan to support the extensive rehabilitation of West Broadway Villas, a 42 affordable rental units for families in the Village of Monticello in the Hudson Valley region of New York State. PathStone was selected to acquire this troubled property owned by USDA’s Rural Development which was originally constructed in 1988. PathStone will complete a total renovation of the existing units plus the construction of a new community building. PathStone, founded in 1969, has been a NeighborWorks America® (NWA) member since 1996 and owns over 2,400 units of rental housing and 92,000 square feet of retail and community space.

French Quarter II, Rental Development

Mennonite Housing Rehabilitation Services for French Quarter II

Location: Wichita, KS

Loan Amount: $400,000

Loan Type: Predevelopment

Project Description: This is NC’s first loan with Mennonite Housing Rehabilitation Services (MHRS). This $400,000 predevelopment loan was used for predevelopment expenses associated with the development of French Quarter, Phase II, a proposed 44-unit affordable general occupancy rental housing development financed primarily with Low Income Housing Tax Credits (LIHTC) and located in Wichita, Kansas. The unit mix will include one, two and three bedroom units to be rented to households with incomes 30% and 60% of the Area Median Income (AMI).

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