Walker & Dunlop, Inc. announced today that it structured $23,020,000 in permanent financing for The Reveal, a 150-unit affordable housing development that will be constructed utilizing four percent Low Income Housing Tax Credits. Further, the Housing Authority of New Orleans has committed to providing Project-Based Vouchers for all 150 units at the site.
Located in Eastern New Orleans, Louisiana, the property is within the bounds of a designated opportunity zone census tract. Established by Congress in the Tax Cuts and Jobs Act of 2017, opportunity zones encourage long-term investments in designated low-income areas by offering incentives in the form of lower or deferred capital gains taxes. The project is also expected to have a significant impact on the revitalization of the surrounding area, which was deeply impacted by Hurricane Katrina and has experienced a slow recovery.
Walker & Dunlop Senior Director Heather Olson identified Freddie Mac’s Tax Exempt Loan Forward Commitment as the ideal program for the developer, Commonwealth Companies, who was ranked a Top 50 Affordable Housing Developer in 2019 . Olson’s team coordinated several different parties to structure the complex affordable financing transaction; in addition to Freddie Mac, the team partnered with the construction lender, Sterling Bank, and the tax credit equity partner, National Equity Fund, as well as the Louisiana Housing Corporation and the Housing Authority of New Orleans. Throughout the assignment, the team also worked to ensure the financing terms were consistent with opportunity zone guidance.
“Commonwealth is thrilled to get this important project started in Eastern New Orleans,” shared Dan Kroetz, Senior Vice President of Development at Commonwealth Companies. “Our experience with Walker & Dunlop was extremely efficient and the flexibility that Heather Olson and her team showed with this complex transaction was first rate.”
Ms. Olson commented, “Walker & Dunlop is honored to be a part of this fantastic team and to help develop 150 affordable housing units that will be vital to the redevelopment of Eastern New Orleans. Having a strong partner in Freddie Mac allowed us to creatively structure permanent financing that fits well with the four percent LIHTC structure. We are excited for Commonwealth to expand their presence in New Orleans and are thankful for this partnership.”
Once complete, The Reveal will comprise two four-story apartment buildings with units ranging from one- to four-bedrooms, each with a balcony. Community amenities will include a leasing office, conference rooms, a community room with patio, a fitness center, and a physical therapy room. The Reveal will also include approximately 1,745 square feet of space for an on-site Business Incubator, a community service facility developed as a neighborhood resource. The facility caters to residents, both on-site and within the surrounding neighborhood, who are interested in building small businesses for self-sufficiency.
Walker & Dunlop is one of the largest multifamily lenders in the country and is the top non-bank affordable lenders in the United States. In 2019 alone, Walker & Dunlop closed over $1.3 billion in transaction volume for affordable properties.