Top 50 Owners Spotlight
#5 National Church Residences
Acquiring and preserving affordable housing for seniors is a top priority for Columbus, Ohio–based nonprofit National Church Residences (NCR). “It’s expanding our reach,” says Mark Ricketts, who took over as president and CEO after Thomas Slemmer retired at the end of 2014. “The board is focused on us growing through acquisitions.”
To facilitate the acquisition of properties, NCR introduced the Affordable Housing Investment Fund last year. The nonprofit put in $10 million in seed money and acquired Antioch Towers in Cleveland and Big Bethel Village in Atlanta.
Ricketts says the investment fund will be a key part of the company’s strategy this year and next. “We’ll probably have 25 or 30 properties added to our portfolio in the next two to three years.”
At press time, NCR had also expected to close a $60 million capital fund in equity investments with a partner by early April. If the money is invested appropriately and strategically, the nonprofit will receive an additional $50 million. Leveraging that money against first-mortgage debt could result in $200 million to $250 million worth of affordable housing purchases, according to Ricketts.
The firm, as well, is committed to helping its senior residents with their health-care needs, working to keep them out of nursing homes and assisted living. The nonprofit is rolling out the National Church Residences Care Guide, a Web-based tool, to screen and document resident needs across its portfolio. — C.S
#21 The Hallmark Cos.
The Hallmark Cos. is working to complete the acquisition of a 793-unit U.S. Department of Agriculture Rural Development (RD) portfolio in Tennessee.
“The project has proven to be quite a challenge thus far through [coordinating] the two Tennessee housing agencies, [implementing] the various financing sources, and creating the economies of scale associated with a consolidation transaction of this magnitude,” says Martin Petersen, Hallmark’s president and CEO.
But that doesn’t deter Petersen, who “fully anticipate[s] a successful preservation project.”
Petersen’s firm consists of several wholly owned subsidiaries that provide a broad range of real estate services, including Hallmark Development Services, which focuses on preserving and developing affordable rural properties.
Hallmark is working on the Tennessee acquisition with its preservation consultant, Greystone Affordable Housing Initiatives. The financing will include tax-exempt bonds, 4% low-income housing tax credits, the subordination and assumption of the existing RD Sec. 515 debt, and new RD Sec. 538 loan funds, says Billy Glisson, vice president of acquisitions and development for Hallmark, who anticipates the approximately $88 million deal closing in the spring.
The project is expected to also use the debt deferral financing tool of RD’s Multi-Family Housing Preservation and Revitalization Loans and Grant Program. Hallmark is also working to acquire a large RD portfolio in Florida. —D.K.
#42 EAH Housing
EAH Housing added to its portfolio with the recent completion of Cathedral Gardens, a 100-unit development in Oakland, Calif.
The three-building community is a mix of new construction and historic rehabilitation, with EAH constructing two buildings and revitalizing a century-old rectory that was originally built, along with a cathedral, in 1893. The cathedral was damaged in the 1989 Loma Prieta earthquake and later demolished.
“This couldn’t get built at a better time,” says Mary Murtagh, EAH president and CEO, citing the area’s rising rents and growing need for affordable housing. More than 5,000 applications flooded in from families hoping to rent one of Cathedral Gardens’ affordable apartments.
The $40 million development was made possible by the Oakland Housing Authority, which bought the site and made it available to the nonprofit through a $1,000-a-year ground lease and provided 43 project-based Sec. 8 vouchers, says Matt Steinle, vice president of real estate development. The project financing included tax-exempt bonds, 4% low-income housing tax credits, and a city loan.
An early leader in green building, EAH Housing joined a White House effort to produce more solar energy last year. Currently, 39 of its communities with solar power generate about 3 megawatts of energy, and additional installations are expected to generate 10 megawatts by 2020.
EAH’s construction activities will continue this year, with plans to start three new projects that will provide nearly 200 affordable apartments in California and Hawaii. —D.K.
