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Presentation, discussion, and possible action regarding a Material Amendment to the Housing Tax Credit Application for Cedar Brook Village (HTC #25074)
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RECOMMENDED ACTION
recommendation
WHEREAS, Cedar Brook Village (Development) received an award of 9% Housing Tax Credits (HTCs) in 2025 for the new construction of 96 multifamily units for the general population in Houston, Harris County;
WHEREAS, the HTC Application received two points for agreeing to include a certified Historically Underutilized Business (HUB) in the ownership structure of the general partner and materially participating in the development and operation of the Development throughout the Compliance Period;
WHEREAS, the proposed HUB, Lapstone Holdings LLC, has elected to withdraw as a member of the general partner and relinquish all rights and interest in the Development, and 7401 East Little York Road Propco, L.P. (the Applicant) is requesting approval to remove the requirement for participation by a HUB; and
WHEREAS, the requested change does not negatively affect the Development, impact the viability of the transaction, would not have affected the selection of the Application in the competitive round, or affect the amount of the tax credits awarded;
NOW, therefore, it is hereby
RESOLVED, that the requested material amendment for Cedar Brook Village is approved as presented to this meeting, and the Executive Director and his designees are each authorized, directed, and empowered to take all necessary action to effectuate the foregoing.
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BACKGROUND
Cedar Brook Village was approved for a 9% HTC award in 2025 for the construction of 96 units, all of which are designated as low-income units, of multifamily housing for the general population in Houston, Harris County. The HTC Application for the Development received two points because the Development was structured to include a Historically Underutilized Business (HUB) in the ownership structure that would have some combination of ownership interest in the general partner of the Owner, cash flow from operations, and Developer Fee. The HUB is also required to materially participate in the development and operation of the Development throughout the Compliance Period.
At closing of the equity financing and construction loan for the Development, the HUB was anticipated to be a 40% owner of the general partner. However, in a letter dated February 20, 2026, Will Sternlicht, representative for the Applicant, requested approval remove the requirement for participation by a historically underutilized business. Since the award of tax credits, the HUB has elected to withdraw as a member of the general partner and relinquish all rights and interests in the Development. The Applicant indicated that, because of changes to program structures and statewide practices that have shifted away from prioritizing historically underutilized business participation in the manner that existed at the time of the Application, the Applicant does not believe that bringing in a replacement historically underutilized business would provide meaningful benefit to the Development. With this proposed amendment, the proposed HUB would not be part of the ownership structure of the Development, and Impact Residential Development, L.L.C. will remain as the sole member and manager of the general partner. There are no new members being added.
In an Affidavit dated February 18, 2026, Jessica Mullins, Manager of Lapstone Holdings LLC, the proposed HUB, requested approval to remove the ongoing HUB participation requirement from the Application. The Affidavit also states that the HUB was not removed from its position and its decision to exit the ownership structure of the general partner, the partnership, and the Development is an action of its own volition.
Staff confirmed that the loss of the Sponsor Characteristics points would not have affected the award. The requested change does not materially alter the Development in a negative manner or impact the viability of the transaction. Because closing on this transaction has not occurred, a public hearing was not requested for this amendment.
Staff recommends approval of the material amendment as presented herein.