BWE secured $15.25 million in permanent loans to finance two affordable seniors housing communities and one affordable multifamily community. Jon Killough and Tony Love of BWE originated the loans for Sweetwater Point, La Vista de Lopez and AHEPA 310.
Killough and Love used HUD’s RAD for PRAC initiative, a new tool designed to preserve existing Section 202 housing as well as create new Section 8 housing across the country. Traditionally, Section 202 PRAC rental assistance could only be used for operating expenses, not debt servicing. The RAD for PRAC process allows borrowers to convert PRAC subsidies to project-based Section 8 contracts, which boosts the rental subsidy to a level that can pay for both operating costs and debt service, while also bringing more project-based Section 8 homes to the market. These transactions represented some of the first multifamily RAD for PRAC executions in the country.
First, a $7.755 million loan will finance the construction of Sweetwater Point, an affordable seniors housing community in Douglasville, Georgia, with 55 one-bedroom units and 41 two-bedroom units. All units will be available to residents earning at or below 60% AMI. The loan was originated with Freddie Mac and has a 17-year fixed-rate term with a 40-year amortization.
Next, La Vista de Lopez, an affordable seniors housing community in Austin, Texas, is being built with the help of $1.5 million in 40-year HUD financing secured by BWE. Featuring 27 units for residents earning at or below 50% AMI, the development will also receive a HUD Section 202 Capital Advance Loan, making it the first multifamily property in the country to combine an FHA-insured new construction mortgage with a new Section 202 Capital Advance. The HUD loan came with a 40-year term and a 40-year amortization period.
Finally, AHEPA 310 is an affordable multifamily community in Mobile, Alabama, that refinanced its debt with a $6 million HUD loan. With 175 units across three buildings, AHEPA V, VI and VII, all units will be affordable to residents earning at or below 50% of the AMI. The loan terms include a 40-year fixed-rate term with interest only payments during the rehabilitation period and a 40-year amortization.
