Affordable Housing Communities
CARMEL, Ind. – Financial services company Merchants Capital announces today it has provided $18.2 million in total refinancing for Eden Housing, a nonprofit that has partnered with local communities to develop or acquire more than 10,600 homes in communities throughout California. The proceeds will be used to rehabilitate two affordable housing communities in the state: Emerson Arms and Arroyo Vista. Located in the San Francisco-Oakland-Berkeley area, Emerson Arms is a 32-unit affordable apartment community with four one-bedroom units and 28 two-bedroom units within three residential buildings. All 32 units are covered by a long-term Option 5 HUD project-based Section 8 contract. The property was constructed in 1973 and last renovated in 2003. Rehabilitation plans include replacing the exterior podium and walkways that service each unit, new railings and exterior stairs, garage ceiling replacement/ventilation, traffic coating on walkways, roof and gutters replacement, window and sliding door replacement, building exterior painting and ADA compliant walkways. Secondly, Arroyo Vista is a 156-unit affordable apartment community located in Mission Viejo, Orange County, California, approximately 70 miles north of San Diego and 50 miles southeast of the Los Angeles central business district – an area in need of affordable housing. Constructed in 1995, the apartments have 36 one-bedroom units, 72 two-bedroom units, 40 three-bedroom units and eight four-bedroom units within nine two- and three-story residential buildings. All units are encumbered by a combination of rent and income restrictions ranging from 35% to 60% Area Median Income (AMI) through various regulatory agreements. Current resident amenities include on-site management, clubhouse, fitness center, playground, sports court, common laundry, pool and a spa. Rehabilitation plans include major plumbing upgrades throughout the entire property to address slab leaks, exterior stairs and railings, window replacement, carport and trash enclosure repairs, playground, in-unit HVAC, upgraded appliances and countertops and cabinets replacement. [caption id="attachment_3112" align="alignleft" width="112"] Dwayne George[/caption] “It’s just as vital to preserve and recapitalize affordable housing as it is to produce it,” said Dwayne George, Executive Vice President, Head of Production at Merchants Capital. “With constraints on Private Activity Bond Volume Cap in state of California, Merchants is optimistic that partnering with key organizations such as Eden Housing to pilot creative debt solutions will complement California Housing Finance Agency (CalHFA) efforts to address the affordable housing crisis in the state of California.” Eden Housing currently serves a diverse population of 22,000 low-income residents from all cultures and backgrounds. The company services very low-, low- and moderate-income families, seniors, veterans, people living with physical, mental or development disabilities and the formerly homeless. [caption id="attachment_3180" align="alignleft" width="118"] Darnell Williams[/caption] “As we continue to face unprecedented times – where our portfolios are aging but we lack the variety of feasible financing solutions to address the physical needs – it is critical to have organizations like Merchants Capital that aim to step in and help affordable housing operators explore various solutions to meet our needs,” said Darnell Williams, Eden Housing Senior Director at Asset Management. “Like many affordable housing providers, we are feeling the implications of bond financing constraints. These two properties – although very different financial profiles – were each in need of a seven-figure capital infusion to buy us time before the next tax credit syndication is available. Dwayne and I began strategizing on possible loan products to address our needs and with his background in GSE financing, he was able to help us consider options that best suited each property. It has been a joy to work with him and his team on these deals.” To learn more about Merchants Capital and its services, visit www.merchantscapital.com or find Merchants Capital on Facebook, Twitter, LinkedIn and Instagram. ###
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Merchants Capital Secures $18.2MM for Eden Housing to Rehab Two California Affordable Housing Communities
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CARMEL, Ind. – Financial services company Merchants Capital today announces an expansion of the tax credit equity team with two senior hires in the acquisitions and underwriting divisions. [caption id="attachment_3170" align="alignleft" width="121"] Laurie DiBona[/caption] Laurie DiBona joins Merchants Capital as Vice President of Acquisitions in Boston. In her new role at Merchants, DiBona will manage relationships with top affordable housing developers in the United States, negotiating and structuring lower tier partnership agreements. DiBona previously spent 12 years in the equity acquisitions and asset management divisions at Boston Capital and R4 Capital.       [caption id="attachment_3171" align="alignleft" width="121"] Lisa Zebro[/caption] Lisa Zebro joins Merchants Capital as Vice President and Deputy Chief Equity Underwriter in New York. Lisa was previously a Manager in Ernst & Young’s tax credit equity division, where she spent 13 years opining on real estate underwriting, transaction structure, tax risk and feasibility for investments in tax credit funds sponsored by the nation’s largest tax credit syndicators. In her new role at Merchants Capital, Zebro is responsible for underwriting lower tier and upper tier investments in tax credit equity funds sponsored by Merchants Capital.     “We are pleased to have these extraordinary women join our team, both of whom are experts in the tax credit equity field,” said Julie Sharp, Senior Vice President at Merchants Capital. “In a time of unprecedented growth in the equity syndication division, Merchants Capital continues to add industry-leading talent in key roles, solidifying our position as best-in-class in affordable housing finance.” To learn more about Merchants Capital and its services, visit www.merchantscapital.com or find Merchants Capital on Facebook, Twitter, LinkedIn and Instagram. # # #
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Merchants Capital Equity Team Expands, adds Two Senior Hires
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CARMEL, Ind. – Merchants Capital’s real estate equity team, in partnership with First Merchants Bank, The National Bank of Indianapolis, and Merchants Bank of Indiana, announces the closing of Indiana Social Impact Housing Equity Fund II, LP. The Fund targets large scale revitalization of vacant single-family homes in traditionally disinvested neighborhoods in and around downtown Indianapolis. The fund infused $2.7M in institutional private equity to support the mission of Full Circle Development. Full Circle will target investment in underserved center city neighborhoods to construct or rehabilitate vacant or abandoned homes, prioritizing women- and minority-owned contractors and subcontractors. Target homebuyers of the as-renovated homes are existing neighborhood residents and families that work in or near downtown with household incomes lower than 120% of the area median income. The added hope is that investment in these communities revive schools and parks, attract businesses, reduce crime, and improve the overall quality of neighborhood living in central Indianapolis. “This capital infusion allows Full Circle to work at scale to address Indy’s dramatic shortage of quality homes attainable to workforce homebuyers, while being a part of re-establishing a thriving real estate market at the neighborhood level,” said Mark Buckingham, President of Full Circle Development. [caption id="attachment_2222" align="alignleft" width="127"] Julie Sharp[/caption] “We’d like to thank our investor partners, First Merchants Bank, The National Bank of Indianapolis, and Merchants Bank of Indiana who share our belief that coming together towards a common goal will make the difference our community needs” said Julie Sharp, Senior Vice President of Merchants Capital, the fund’s managing general partner. “We’re excited to embark on this joint effort that affirms our mission of helping our communities thrive,” said Mike Stewart, President of First Merchants Bank. “The fund offers a holistic approach to improving our neighborhoods because it reduces vacant homes but also prioritizes current residents and employing minority- and women-owned contracting businesses.” “We are proud to be an investor in Merchants Capital’s Indiana Social Impact Housing Equity Fund II.” said Mark Bruin, President and CEO of The National Bank of Indianapolis. “The National Bank of Indianapolis believes that through equitable access to capital and dynamic lending partnerships such as this, we can help build a thriving community where families have access to quality affordable housing.” “We share a passion with Full Circle Development and our investment partners that quality affordable housing can revive communities in the great city of Indianapolis.” said Michael F. Petrie, Chairman of Merchants Bank of Indiana. “We thank them for their partnership.” To learn more about  Merchants Capital and its services, visit www.merchantscapital.com or find Merchants Capital on Facebook, Twitter, LinkedIn and Instagram. ###
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Merchants Capital Raises $2.7M in Institutional Equity to Support Neighborhood Housing Revitalization in Indianapolis
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CHICAGO – The Chicago office of financial services company Merchants Capital recently secured more than $26 million in financing for the acquisition of Island Terrace, an affordable apartment complex in Chicago’s Woodlawn neighborhood. The project is located across from the planned Obama Presidential Center in Chicago. [caption id="attachment_942" align="alignleft" width="134"] Emmett Donovan[/caption] “We are proud to have served as the financing partner for this important project in Chicago,” said Emmett Donovan, Senior Vice President at Merchants Capital. “Merchants Capital is committed to preserving and expanding affordable housing options across the United States, and our work on this project strongly exemplifies that commitment.” After acquisition, the borrower, Preservation of Affordable Housing, Inc. (POAH), plans to syndicate the property with a tax credit structure utilizing both a 4% and 9% Low-Income Housing Tax Credit (LIHTC), making Island Terrace one of the first housing properties to utilize this unique type of financing. Upon syndication, all 240 units will be divided into two condominiums, with 178 units housed in the 4% LIHTC condo and 62 units in the 9% LIHTC condo. In addition to securing the acquisition bridge loan facility, Merchants Capital issued project term sheets for both the 4% and 9% LIHTC equity bridge loans to be used during the construction and renovation phase. “We are delighted to announce our purchase of Island Terrace. This is a crucial preservation opportunity given its location, and working with Merchants we can ensure its long-term affordability,” said Bill Eager, Senior Vice President at POAH. The syndication will ensure the long-term affordability of the project with the 20-year extension of the existing project-based Section 8 contract covering 88 units, the transfer and 20-year extension of a project-based Section 8 contract covering 44 additional units, an existing Chicago Low-Income Housing Trust Fund use agreement covering 11 units and a new Low Income Housing Tax Credit (LIHTC) use agreement restricting the remaining 99 units at the 60% and 80% area median income (AMI) levels utilizing income averaging. Renovation to Island Terrace is expected to begin in mid-2022, with a focus on improvements to major property systems and modernization of approximately $100,000 per unit. To learn more about Merchants Capital and its services, visit www.merchantscapital.com or find Merchants Capital on Facebook, Twitter, LinkedIn and Instagram. ###
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Merchants Capital Secures $26MM+ for Affordable Housing Development in Chicago’s Woodlawn Neighborhood
Housing Property in Kansas
CARMEL, Ind. – Financial services company Merchants Capital announces today it has secured a $35 million construction loan for Union at the Loop, an affordable, multifamily housing community coming to Lawrence, Kansas. Merchants Capital also acted as servicer for the $22.25 million Freddie Mac Tax Exempt Loan (TEL) forward permanent commitment. Union at the Loop, developed by The Annex Group, will be located at 3250 Michigan St. as the city’s newest affordable, 4% Low-Income Housing Tax Credit (LIHTC) property. The 248-unit property will house one-, two- and three-bedroom apartments for residents who earn up to 60% of the area median income (AMI), or an annual income of $35,800 to $57,300. Brian Emmons “Due to Merchants Capital’s multi-layered debt products, we were able to offer and successfully secure construction and permanent financing for Union at the Loop. We are excited to partner with The Annex Group on this project that will provide much needed affordable housing options to the workforce families of Lawrence,” said Brian Emmons, Senior Vice President, Loan Operations for Merchants Capital. Notable amenities will include a business center and clubhouse, a fitness center, exterior storage, onsite management, picnic areas, a playground, video surveillance, walk-in closets and washer and dryers. The complex will be conveniently located to public transportation, grocery stores and restaurants. “When we started looking at the Lawrence area, we saw that almost all existing affordable housing communities had a wait-list of residents hoping to move-in,” said Kyle Bach, CEO of The Annex Group. “Because of the student population at The University of Kansas, there are both typical residents and university students in the rental market, causing a strain. We wanted to ease the need for affordable housing with a community that will feel like home to residents looking for conveniences, amenities and affordability.” Construction began in August 2021, and the property is expected to be open in October 2022. To learn more about Merchants Capital and its services, visit www.merchantscapital.com or find Merchants Capital on Facebook, Twitter, LinkedIn and Instagram. ###
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Merchants Capital Secures $35MM+ for New Affordable Housing Property in Kansas