CARMEL, Ind. – Merchants Capital, a mortgage banking company, has secured $6.5 million in total funding for mixed-income development Trolley Station Terrace, a 45-unit affordable housing property. Located in Marinette, Wisconsin, Trolley Station Terrace will provide affordable and supportive housing to Marinette County residents in need.
Of the $6.5 million financing, $1.8 million will go towards a Rural Development (RD) 538 option 3 loan and $4.7 million towards a Low-Income Housing Tax Credit (LIHTC) bridge loan. Merchants Capital worked closely with Wisconsin’s Rural Development and nonprofit developer Newcap Inc. to contribute to the project.
Timing was a big hurdle in bringing the Trolley Station Terrace project to life. The Wisconsin Housing and Economic Development Authority (WHEDA) had strict deadlines for the project to break ground – otherwise, the credits would be lost. Contracts for building materials were set to expire quickly unless the financing was finalized. The Merchants Capital team successfully closed the deal on time, preserving the credits and the material contracts, ultimately saving the borrower hundreds of thousands of dollars.
“Merchants Capital has a willingness and desire to provide affordable housing to all areas in need. We also pride ourselves in having flexibility on the financing to help borrowers get the best execution possible in the shortest amount of time,” said Merchants Capital Transaction Manager Gus Gilmore. “Our developer, Newcap Inc., is a nonprofit. Every dollar counts for them on these deals. We were able to be flexible in our LIHTC bridge loan to meet their needs as costs changed, timelines shifted and numbers were tweaked. We are thrilled with how efficiently we were able to work together on Trolley Station Terrace.”
Newcap Inc. is a Wisconsin-based nonprofit founded in 1965 as part of the Community Action Network. According to their website, Newcap Inc. “helps those living with the conditions of poverty have better lives while helping them find opportunities to improve their lives for the futures of themselves, their families and their communities.”
“Trolley Station Terrace is 45 new apartment homes for families in the Marinette area, 38 of which are reserved for low- and moderate- income workers who don’t have many good options for high quality, affordable housing,” said Cheryl Detrick, Newcap Inc. CEO and president. “Trolley Station is also a major step for Newcap in its mission of enhancing community development. Accessible, affordable housing is a critical component to moving families from poverty to opportunities and economic security.”
The 38 LIHTC units will be available for renters who earn up to 30%, 50% and 60% of the area’s median income (AMI). These apartments include one-, two- and three- bedroom units. Additionally, nine of the units will be considered supportive housing. These rooms will be reserved for local veterans, including those who require long-term care services due to disabilities and/or impairments. All units will feature in-unit laundry, a patio or balcony, standard kitchen appliances and forced-air HVAC.
Construction began on the property in late August 2020 and is scheduled for completion in August 2021. Once completed, the three-story Trolley Station Terrace will sit on 2.5 acres of land and will be located at 1535 Main Street.