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Presentation, discussion, and possible action on a loan approval for Sweetwater Station
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RECOMMENDED ACTION
recommendation
WHEREAS, the above listed development was awarded 9% housing tax credits during the 2021 competitive Application round;
WHEREAS, the Developer applied for additional funds under the Department's 2024-2 HOME Notice of Funding Availability, which was released last year specifically for the purpose of addressing funding gaps in previously-awarded Developments; and
WHEREAS, the Department is now recommending approval of a loan in the amount of $5,000,000 to address this funding gap, with proposed loan terms and details concerning the Development's financials outlined below;
NOW, therefore, it is hereby
RESOLVED, that the that loan of $5,000,000 of HOME funds to Sweetwater Station is approved, subject to conditions that may be applicable as found in the Real Estate Analysis Underwriting Report posted to the Department's website and as described within this Board Action Request.
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BACKGROUND
Development Information: Sweetwater Station is to be located in Sweetwater, Nolan County, and proposes the new construction of 52 units that will serve the elderly population. The Development will serve households with incomes at or below 30%, 50%, and 60% of Area Median Family Income (AMFI).
Financial Information: The Department's $5,000,000 HOME loan is to be structured as fully repayable at 2.00% interest and is in first-lien position.
The Development initially received $900,000 housing tax credits in 2021, and a supplemental allocation of $135,000 in 2023. Since the last underwriting, total building costs have increased by $2.81 million, and total development costs have increased by $3.67 million. The brings current total housing development cost to approximately $13.7 million.
To fill the gap created by these increases, the Department's loan is proposed to replace a loan from Sterling Bank that was initially proposed to...
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