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The NMTC Houses That Habitat Built in Kent County

Investors Fund 239 Habitat for Humanity Homes in 8 States with New Markets Tax Credits

June 13, 2012 -- ST. LOUIS, MO : An infusion of nearly $20 million of New Markets Tax Credits (NMTC) funding split evenly between Habitat for Humanity of Kent County and nine other Habitat affiliates in Colorado, Nebraska, Connecticut, Missouri, Washington, Arizona and Florida will help build 239 homes nationally.

In Michigan the Habitat for Humanity of Kent County affiliate, funded on May 24, 2012, will use its $1,880,000 Qualified Low Income Community Investment (QLICI) loan from CEI Capital Management LLC (CCML) of Portland, ME to build 10 homes in a distressed area of Kent County where poverty rates are between 25.90% - 40.60% and unemployment is between 1.45 – 3.71 times the national average. The Kent County homes, ranging in size from 1230-1530 square feet will be completed between May 2012 and December 2013.

Established by Congress in 2000 in an effort to stimulate investment and economic growth in designated low-income communities, the NMTC program helps raise investor capital and leverages public and private funding to provide borrowers, like these Habitat affiliates, with financing that comes in the form of very favorable rates and below market, flexible terms. Partnerships like this one orchestrated by Smith NMTC Associates, LLC with CEI Capital Management LLC and the Kent County Habitat affiliate and invested in by U.S. Bank, help Habitat affiliates stretch their fundraising and development dollars, increasing the nonprofit’s ability to meet its mission of building decent, affordable housing for those in need.

Each of the homes will be Leadership in Energy and Environmental Design (LEED) certified by the US Green Building Council and built to an ENERGY STAR® (whole house energy savings minimum

Page 1 of 5of at least 15%) providing cost savings over the life of the home. An additional benefit of the Habitat home builds receiving NMTC funding are the number of local businesses and volunteers that get involved in the build furthering their businesses and the local economy. Twenty construction subcontractor jobs were created to perform electrical, mechanical and plumbing work on all 10 NMTC homes in Kent County. Nationally, 18 full time and 15 part time Habitat affiliate jobs were created and a total of 387 construction jobs were created from CCML’s total NMTC investment of nearly $20 million. Each Habitat Family Partner contributes 300-500 sweat equity hours before purchasing their home. They pay a modest down payment, sign standard loan documents, and make affordable, monthly mortgage payments to repay the 0% interest loan over 20-30 years. This Habitat affiliate offers homeownership opportunities to low-income families unable to obtain conventional financing.

Once thought impossible to apply to for sale, affordable, single family housing, NMTC dollars now help Habitat affiliates build more homes and make more interest free loans available to industrious Habitat family partners. CCML utilized the Smith NMTC Model developed by Smith NMTC Associates specifically to tackle the roadblocks to NMTC funding of smaller projects associated with affordable, for sale, single family housing. In order to structure the investment, CCML partnered with U.S. Bank, which capitalized CCML’s NMTC allocation and leveraged fundraising and development dollars raised by Habitat. Fulfilling the mission of the NMTC program to attract new investment capital to disadvantaged communities, the loan is a boon in a year where securing viable real estate financing for affordable, single family homes, is difficult, if not impossible in some areas of the country.

Howard Smith, JD, Principal and co-founder of Smith NMTC acknowledged the significant evidence that the NMTC is working. “NMTC financed over $20 billion in loans and equity investments to businesses located in communities with substantial rates of poverty and unemployment through 2010,” Smith noted. “CEI Capital Management and U.S. Bank have been ideal partners to bring NMTC funding to Habitat for Humanity of Kent County and other parts of the country. We are also happy to work with the Kent County Habitat affiliate for a second time as they build more homes with NMTC dollars and gain knowledge and experience of the compliance process.”

“CCML is pleased to be a partner with Smith NMTC in developing a creative way to fund Habitat for Humanity of Kent County,” said Tad Atwell, CCML’s Senior Investment Officer. “This project hits on each of our ‘Triple E’ underwriting criteria, where the beneficiary furthers economic progress, social equity and environmental sustainability.”

The Kent County Habitat affiliate acknowledges the advantages of having NMTC funding available to increase its budget and capabilities in helping more families achieve home ownership.

“Raising funds to build and restore homes is a challenging part of our job,” said Mary Buikema, Executive Director, HFHKC, “so the availability of New Markets Tax Credit dollars to build Habitat homes is a tremendous advantage to us. We are using the proceeds of this NMTC funding to support additional efforts in the lowest income area of our affiliate. We have targeted these specific neighborhoods knowing that we can have the greatest impact when we do many homes in a concentrated area.“

Habitat for Humanity of Kent County, Inc., CEI Capital Management LLC , U.S. Bank and Smith NMTC Associates, LLC, partnerships building communities, are looking forward to

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seeing the 10 new Habitat Family Partners at work with local business and volunteers raising their new houses and fulfilling a time-honored American dream.

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for the full press release, please contact [email protected]

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