Interim Development

NC’s Interim Development Loan product provides NWOs with flexible funds to pay for land and/or building acquisition, predevelopment, construction/rehabilitation financing and is also an excellent source of bridge financing and lines of credit. Interim Development Loans may be in an amount of up to $7 million, with larger amounts (up to $10,000,000) available through participation with other CDFIs. Terms can be as long as 36 months. The interest rate is as low as 5% (fixed), with interest-only payments. Loans must be secured by acceptable collateral, with the exception that up to $200,000 of the loan may be unsecured. Interim Development Loans can be placed in a subordinate position to a first mortgage lender. The Loan to Value (LTV) ratio for Interim Development Loans can be as high as 95%.

RUPCO for Energy Square

Location: Kingston, NY

Loan Amount: $595,000

Loan Type: Interim Development

Project Description: RUPCO requested acquisition financing for the development site for Energy Square (E2), a 57-unit apartment building with 8,000 SF of ground floor commercial, to be built in Kingston, NY. The project will continue RUPCO’s revitalization work of the Midtown neighborhood of Kingston, and demonstrate the benefits of net-zero development, where all energy used by the property and residents is generated on-site using photovoltaic panels and geothermal heating. The E2 project is part of a corridor of RUPCO developments, from The MetLife film-and-television production project (recently acquired with NC financing) and The Lace Mill, an affordable housing development completed in 2015. RUPCO had the property under contract since May 2015, and had anticipated waiting until they secured development financing before closing the acquisition; however, the property seller, on short notice, accelerated the contract expiration to early September, compelling RUPCO’s request to NC. This loan was underwritten and closed in less than 3 weeks.

Nuestra Comunidad for Harlow-Howard

Location: Dorchester (Boston), MA

Loan Amount: $1,269,000

Loan Type: Interim Development

Project Description: Nuestra requested an interim development/construction loan from NC to finance the new construction of 4 condominium units in the Dorchester neighborhood of Boston, Massachusetts. While the project is unrestricted/market rate, the units will be marketed at a price affordable to households with incomes in the range of 85% to 95% of the Area Median Income, and lower than comparable condo units in the area. Nuestra has owned the site for 25 years but only in recent years have the market conditions supported the development of unsubsidized for-sale housing in Dorchester. This project fits Nuestra’s strategic plan of developing homeownership projects that are targeted to a more diverse income population, including workforce housing. This is the result of feedback it has received from local elected officials and community stakeholders who want to see a more comprehensive and inclusive approach to community development that includes more diversified levels of incomes.

Community Frameworks for Valley Pointe

Location: Spokane Valley, WA

Loan Amount: $1,200,000

Loan Type: Interim Development

Project Description: In early 2008, Community Frameworks (CF) purchased a 2.41 acre parcel of land in the City of Spokane Valley to develop 30 for-sale townhouses. After completing construction on eight of the planned 30 highly energy efficient townhouses, and laying down the infrastructure on the remaining 22 sites, CF suspended the project due to slow sales and unforeseen market conditions and the modern architecture which was not common in this market area. CF's board decided to convert the project to affordable rental housing development to be called "Valley Pointe”. With the plan to build rental housing the construction lender needed to be repaid. NC was pleased to assist CF in providing a loan to repay the previous loan and provide predevelopment resources to apply for LIHTC and other state and local housing funds. The planned project will be a 34-units that will serve homeless and low and very low- income families.

RUPCO for Metlife Building (Makers Space)

Location: Kingston, NY

Loan Amount: $950,000

Loan Type: Interim Development

Project Description: RUPCO requested a $1,900,000 acquisition loan to exercise their option to purchase a 70,268 SF industrial building located in Kingston, NY. RUPCO, in partnership with proposed anchor tenant Stockade Works (STW) a nonprofit founded by the actress and producer Mary Stuart Masterson, plans to rehabilitate the building into light industrial “Maker’s Space” for entrepreneurial businesses, including but not limited to, a television and film production sound stage and post-production studio space. This economic development project is designed to provide needed production space for the television and film industry already located in Hudson Valley who will capitalize on the expanded film and television tax credits available by filming in Kingston. The project is projected to create 57 construction jobs and 581 permanent jobs when the facility is fully operational. STW also has plans to provide workforce development and educational opportunities for residents seeking jobs in the film and television production industry. NC participated in a $1.9 million loan led by the Leviticus Fund, a New York based CDFI.

Nevada HAND for Sierra Pines Bridge Loan

Location: Las Vegas, NV

Loan Amount: $3,000,000

Loan Type: Interim Development

Project Description: Nevada HAND (NHI) needed a six month bridge loan to repay an existing acquisition loan from a national bank that was used to acquire Sierra Pines Senior Living from the general and limited partners in 2014. NHI had already received an 4% LIHTC and tax-exempt bond award and needed additional time to review and negotiate investor proposals as LIHTC pricing had dropped by more than 15%.

Willamette Neighborhood Housing Services for Larson Commons Phase 2

Location: Corvallis, OR

Loan Amount: $223,200

Loan Type: Interim Development

Project Description: WNHS used a $455,000 loan to purchase a 0.495 acre site in South Corvallis, adjacent to parcel purchased in 2016. The combined sites will be developed as Larson Commons Phase 2 which will offer 13 townhouse rentals affordable to families at 50% AMI. The development will be financed with 9% LIHTC, CDBG and HOME funds, and a permanent loan. NC participated in this loan with Network of Affordable Housing (NOAH), an Oregon CDFI.

Huntington Square

A Community of Friends (ACOF) for Huntington Square

Location: Huntington Square, CA

Loan Amount: $2,010,000

Loan Type: Interim Development

Project Description: This is ACOF’s 2nd loan with NeighborWorks Capital. ACOF requested a $2,010,000 Interim Development Loan request from a first-time borrower, A Community of Friends (ACOF). The loan will be used for the acquisition of land associated with the new construction of a mixed-use project consisting of 55-units of affordable special-needs rental housing and 10,000 SF of commercial/retail space located in Huntington Park, CA. The project will be built on a 0.77 acre site. All units will be targeted to households earning 50% of the Area Median Income or less. The commercial/retail space is anticipated to be a neighborhood-serving eating establishment or potential retail or service-oriented use.

Fox Run 2 Rendering of one house.

Community Housing Improvement Program (CHIP) for Fox Run 2

Location: Cottonwood, CA

Loan Amount: $1,200,000

Loan Type: Interim Development

Project Description: This is Community Housing Improvement Program (CHIP) 1st loan with NeighborWorks Capital. CHIP requested an interim development loan from NC of $1,200,000 to refinance acquisition and cover site development costs for the Fox Run 2 project which is new construction of 24 units of single-family self-help housing in Cottonwood, California. CHIP was referred to NC by Rural Communities Assistance Corporation, CHIP’s long-time lender for this type of financing. Buyers will be applicants to the USDA 502 Mutual Self-Help program serving people at or below 70% of the Area Median Income (AMI).

Etting Road Rendering

Cabrillo Economic Development Corporation for Etting Road

Location: Oxnard, CA

Loan Amount: $1,200,000

Loan Type: Interim Development

Project Description: This is Cabrillo Economic Development Corporation (CEDC) 11th loan with NeighborWorks Capital. CEDC has requested a $1,200,000 Interim Development Loan for the acquisition of land associated with a new construction project consisting of 42-units of affordable family housing, of which 34 units will be set aside for farmworkers, in Oxnard, CA. The development will provide 41 affordable rent restricted apartments for both farmworkers (34 units) and families (7 units) plus one apartment for an onsite resident manager. Apartments will be rent restricted to 30%, 45% and 50% of Area Median Income. It is planned that units set aside for farmworkers earning at or below 30% AMI and 45% AMI will receive USDA Section 521 Rental Assistance subsidies.

St. James Plaza

AHC, Inc. for St. James Place

Location: Alexandria, VA

Loan Amount: $6,500,000

Loan Type: Interim Development

Project Description: This is AHC, Inc.’s 3rd loan with NeighborWorks Capital. AHC requested a $6,500,000 Interim Development Loan to finance the acquisition of 5000/5001 Echols Avenue, a 3.12 acre site in Alexandria, Virginia. The property has been rezoned and subdivided to permit the development of 225 units in two multifamily buildings. On the western parcel, AHC will develop, own, and operate a 93 unit 9% LIHTC project. AHC has received a reservation for tax credits and financing commitments from the City of Alexandria. Shortly after closing AHC will issue an RFP for debt and equity investors with a targeted equity and construction closing in Fall 2016. The project will have 3 efficiency units, 12 1-bedroom, 66 2-bedroom, and 12 3-bedroom units with rents from 40% to 60% of AMI.


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