Finance

Mortgage banking company Merchants Capital recently structured the permanent financing for Goddard Riverside Community Center’s Phelps House, a 169-unit affordable housing complex for seniors, located at 595 Columbus Ave. (at 88th Street), to help secure the financial future of the property. Phelps House has historically provided – and through the success of this transaction will continue to offer – affordable, subsidized housing and services for low-income older adults in one of the most expensive and prestigious neighborhoods of New York City: the Upper West Side of Manhattan. The property also houses the Goddard Riverside offices and a full-service Senior Center which serves residents from the surrounding community. This long-term financing will enable the owner to keep the units affordable to tenants, while also continuing to provide them with quality housing by making capital improvements, including plumbing and accessibility upgrades. Additionally, the financing will extend the affordability period and subsidy term by a minimum of 20 years to ensure continued operations of the highest standard in the long term, in accordance with the Goddard’s mission to provide high quality senior services to their residents. This Freddie Mac and New York City Housing Development Corporation (HDC) Risk Share financing vehicle benefits Goddard, one of the oldest non-profit/social services providers in the city. “The Phelps House transaction exemplifies the type of mission-driven preservation of affordable housing that we love to be a part of,” said Merchants Capital Vice Chairman Mathew Wambua. “We are grateful to Goddard for their vision and commitment to community, and we are deeply appreciative to HDC, Housing Preservation & Development (HPD), Freddie Mac, and Rockabill Consulting for their partnership. Merchants Capital is proud to have been a participant in assisting the operating of a pillar of the community such as Goddard Riverside.” Last year, more than 22,000 New Yorkers took part in the wide range of activities offered by Goddard.  The agency’s programs range from early childhood education and school-based/after school-based programs, to providing over 540 units of permanent housing with on-site supportive services. Goddard also provides outreach with extensive aid to people living with mental illness and those who are experiencing homelessness, as well as assistance to older adults and those with mobility impairments. “Goddard Riverside’s goal is to invest in people and strengthen the community, and older adults are a key part of that picture. Goddard will be able to continue providing high-quality housing at an affordable price for them,” said Goddard Riverside Executive Director, Roderick L. Jones, Ed.D. “The new resources will allow Goddard to enhance efforts to ensure those most in need are helped.” “Rockabill is grateful for our longtime partnership with Goddard Riverside Community Center, and for the opportunity to assist with their affordable housing preservation and development goals,” said Niall Murray, Managing Principal of Rockabill Consulting and Development. “This transformative deal was the result of a strong and committed group from Goddard Riverside, Merchants Capital, Freddie Mac, HUD, HPD, and HDC working to ensure this vital Upper West Side senior housing remains affordable and viable in the long term. Through the forward-thinking initiative of the Goddard Riverside staff and board of directors, Phelps House will continue to house low-income seniors in the community for years to come.”

We are thrilled to announce that Merchants Capital CEO Michael Dury has been named to the Indianapolis Business Journal’s 40 Under 40 list. This list consists of local business and professional leaders who have achieved success and excelled in their field before the age of 40. Those who have demonstrated leadership, initiative and dedication in pursuing their careers, and who are likely to continue such achievements in the future, all make up this prestigious group of recipients. Dury received his MBA from Indiana University’s Kelley School of Business and started working at Merchants Capital shortly after graduation. At just 35, Dury is one of the top loan originators nationwide. His personal loan production value is on par with some of the top lending firms in the U.S. Our CEO is a pillar in the Indianapolis community and the state as a whole. His efforts have been highly influential in the financing and creation of many notable market-rate and affordable multifamily properties around Indiana, including a recent first-of-its-kind loan to preserve and renovate affordable housing for the low-income residents of Carriage House, a Section 8 housing development in Evansville. A local powerhouse who has spent his entire career at Merchants Capital, Dury has helped grow the company from a humble team of eight to 100 employees across four offices (Carmel, New York City, St. Paul and Chicago), in addition to leading acquisitions and bringing in talent to establish those high-production locations. In September, we cut the ribbon on our $25 million, 120,000-square-foot headquarters in the City of Carmel’s Midtown district – a commitment to the long-term, sustainable growth in the state that Dury played a pivotal role in. One of his most notable triumphs was announcing that we were named No. 10 on the Top 25 U.S. Affordable Lenders of 2018 list by Affordable Housing Finance. Additionally, we have been named one of the Best Places to Work in Indiana four years in a row. Dury’s career in the Indianapolis market has been one of immense growth and leadership. From his first role overseeing a small team to helping Merchants Capital become the billion-dollar corporation it is today, he is unstoppable. Above all, his ability to build relationships with developers, keep promises to bring safe, new and affordable housing to low-income individuals around the nation, and seeing opportunity when others see obstacles separates our CEO from all others. Read his IBJ profile here. To see the full list of nominees, click here.

Carmel, INDIANA (08/15/2017) – Carmel Indiana based PR Mortgage & Investments (PR) is pleased to announce the closing of its acquisition of RICHMAC Funding LLC (RICHMAC), a national Freddie Mac Targeted Affordable Housing Seller/Servicer, Fannie Mae Multifamily Affordable Housing Lender, approved FHA multifamily lender and Ginnie Mae issuer. The seller was an affiliate of The Richman Group. “The RICHMAC platform gives our existing customer base access to Freddie Mac and Fannie Mae, which complements our existing FHA lending platform. Furthermore, RICHMAC and its customers, which include some of the country’s largest apartment owners, will now have support from PR and its parent company, Merchants Bank of Indiana (MBI). MBI will be providing conventional construction and/or bridge loan products that enhance RICHMAC’s permanent loan products. This acquisition solidifies our commitment to affordable housing and gives the MBI family of companies a full array of affordable housing debt products with FHA, Freddie Mac, Fannie Mae, and conventional bank financing.” said Michael Dury, Executive Vice President and COO of PR Mortgage & Investments. RICHMAC will continue to be led by Mathew Wambua and Marsha Goff from offices in New York and Minneapolis. “We welcome Mathew and Marsha and their staff and look forward to working with our existing and new customers in providing expanded and innovative loan products,” added Dury. Beekman Advisors served as strategic advisor to RICHMAC in the transaction and assisted with securing transaction approvals. Wooden & McLaughlin LLP and Ballard Spahr LLP served as legal counsel to PR and RICHMAC, respectively. PR Mortgage & Investments was established in August of 1990 as a mortgage banking firm specializing in multifamily housing and health care facilities finance in the Midwest.  PR is a premier provider and servicer of Multifamily, Senior, and Student Housing. PR is an approved FHA Mortgagee and is an approved Multifamily Accelerated Processing (MAP) lender for HUD. PR is a wholly owned subsidiary of Merchants Bank of Indiana. Merchants Bank of Indiana is headquartered in Carmel Indiana and focuses on several aspects of mortgage lending, agricultural lending, and retail banking services from four Central Indiana locations. Merchants Bank of Indiana has over $3 billion in assets, 165 employees, and more than 100 shareholders. To learn more about Merchants Bank of Indiana, visit www.merchantsbankofindiana.com.

Rising construction costs and increased trade values of sales have made large loans a regular occurrence of PR Mortgage customers.  What constitutes a “large” loan you might ask?  HUD considers a large loan to be over $40 million for new construction/sub-rehab and over $50 million for refinance/acquisition loans.  HUD has created specific underwriting criteria for the large loans with regard to Loan to Cost, Debt Service Coverage, and Initial Operating Deficit Reserves with respect to new construction loans.  HUD has also created Loan to Value and Debt Service Coverage requirements for the refinance/acquisitions loans.  The intent of HUD policy is to reduce the risk of these large loans by increasing the thresholds of these categories. For example: a $60 million dollar market rate new construction/sub-rehab project would require a 1.25 DSCR and 80% LTC vs the under $40 million policy of 1.20 DSCR and 83.3% LTC.  The same method applies to Tax Credit Deals however a tax credit deal at $60 million would be limited to 1.20 DSCR and 85% LTC vs the sub $40 million policy of 1.15 DSCR and 87% LTC respectively. Refinance and acquisition loans behave in a similar way.  A $60 million refinance/acquisition would be limited to 1.25 DSCR and 80% LTV (75% if Cash Out) vs the below $50 million policy of 1.20 DSCR and 83.3% LTV (80% if Cash Out).  A $60 million refinance/acquisition of an affordable project would be limited to 1.20 DSCR and 83.3% LTV (75% if Cash Out) vs the below $50 million policy of 1.176 DSCR and 85% LTV (80% if Cash Out).  Additional thresholds apply to loans above $75 million. We have had great success with borrowers combining phased projects or building in high cost areas with these HUD programs.  Ask your PR Originator about your large loan today!  originations@prmic.com