Highland Assists Joint-Venture In Acquiring Three Affordable Housing Projects
December 10, 2015
A joint-venture between Impact Development Group, LLC (IDG) and Toffer Mann Investments LLC (TMI) closed escrow December 3, 2015 on three affordable housing projects in California.
Cherrywood Manor (CWM), a 30 unit senior housing development, is located in the City of Beaumont; El Monte West Apartments (EMW), a 40 unit family housing development, is located in the City of Dinuba; and Sagewood Manor (SWM), a 65 unit senior development, is located in the City of Twentynine Palms.
All three developments are existing housing projects originally financed with Rural Development 515 loans from the United States Department of Agriculture (USDA). The joint-venture assumed the USDA debt, totaling $3.7 million, as part of the acquisition.
Highland Property Development LLC (HPD) worked with IDG and TMI to successfully earn an award of federal and state low-income housing tax credits allocated by the California Tax Credit Allocation Committee, which is expected to generate over $11 million in private equity arranged through Boston Financial Investment Management, LP.
JPMorgan Chase is providing construction financing of up to $9,375,000 enabling the joint-venture to expend $47,500 per unit in direct hard costs toward renovating the projects, addressing critical needs and generally improving the quality of life for the 135 family and senior households residing at the properties.
Bonneville Mortgage Company, based in Salt Lake City, has committed up to $3,125,000 in additional permanent financing under the USDA RD 538 loan guarantee program. The additional permanent debt will fund following completion of the renovations.
Highland Property Construction, Inc., an affiliate of HPD, will oversee the renovations at each project, which are expected to be completed by the fourth-quarter of 2016.
HPD is a development company based in Arcadia, California. Since 2002, HPD has acquired and rehabilitated nearly 2,700 affordable housing units throughout California and Texas, specializing in preservation and redevelopment of existing USDA and HUD financed properties. In addition to assisting in the acquisition and financing of CWM, EMW and SWM, the joint-venture has engaged HPD to oversee asset management of the properties for the life of the investments.