We extended new borrower CDC of Tampa (CDCT) a $1 million revolving line of credit to help acquire and rehabilitate single-family homes in the Tampa, Florida, metropolitan area.
This major urban development will serve a critical need as they are resold to moderate-income households, generally between $60,000 to $70,000 (100% to 120% AMI). The single-family home market in the Tampa metro area has experienced steady growth in the past 5 years, and has recovered to nearly pre-2008 levels. Household and per capita incomes have been increasing in the Tampa metro area since a low point in 2010-11. CDCT’s project will provide homes to people who otherwise might have to look at older homes in disrepair, or in areas with declining property values. CDCT sells the renovated homes for lower than the normal rates in the area, helping people who would otherwise not be able to afford it.
“CDC Tampa’s combined mission of home ownership, support and counseling is a great example of vertical integration in a solid market, making them a good fit for the NeighborWorks Capital family,” said our Chief Lending Officer Stephen Peelor.
Troubleshooting another development caused CDCT to delay this closing, meaning our previous loan commitment expired. Once the other project was finished, CDCT renewed their request to us in November 2017 and asked to increase the line to $1 million, as well as permit draws for new construction of single-family homes on vacant lots already owned by CDCT. This loan will help CDCT continue to expand their capital and development initiatives. While a delay in closing is unusual, CDCT’s willingness to focus on a project and problem solve is a positive, Peelor said.
CDCT formed in 1992 to help real estate stabilization and employment assistance programs in East Tampa. CDCT is structured around three lines of business: Real Estate Development of primarily single-family construction and rehab; its Career Resource Center, providing classroom-based skills training and job placement assistance; and Youth Leadership, a range of programs to increase civic and cultural engagement by children and teens in East Tampa. CDCT also provides homeownership counseling services to low and moderate-income households.
In addition to their growing single-family rehab program, supported by the proposed line of credit, CDCT is starting construction on a 13- home subdivision near their office in East Tampa with construction financing from a local CDFI. This project will be single-family homes priced between $150,000 and $220,000.