The NHP Foundation (NHPF) has broken ground on a development that will help meet the housing needs of workers in the resort community of Frisco, Colorado.
Galena Apartments is a direct response to the severe shortage of housing for essential workers in the region and comes as the town has identified affordable workforce housing as one of its top priorities.
The 54-unit development will be restricted to households earning up to 120% of the area median income.
The development of Galena Apartments marks several milestones, including NHPF’s first development in Colorado. According to officials, it’s also one of the first Section 501(c)(3) financings using a nonprofit’s “lessening the burdens of government” charitable mission to enable a tax-exempt workforce housing bond financing and the first time that NHPF is leveraging its S&P AA-rating to enhance bond financing.
Most of the project financing, $18.6 million, came from 501(c)(3) bonds issued by the Middle-Income Housing Authority—its first bond transaction since its inception in 2022. NHPF guaranteed repayment of the bonds, enabling Standard & Poor to rate this as an AA- transaction.
“In addition to this project being our first development in the state, it is the first use of investment-grade 501(c)(3) bonds for new construction of middle-income housing in Colorado and the first time NHPF is using its S&P rating to enhance tax-exempt bonds,” said Eric Price, NHPF president and CEO.
This guarantee gives the bonds a lower interest rate.
The state Department of Local Affairs awarded the town $2.8 million in grant funds through the More Housing Nowprogram and Strong Communities program to build the infrastructure around the site. In addition to providing the land for the project, the town of Frisco also provided gap financing of $8.1 million.
NHPF officials said they consider Galena Apartments the first of many developments they would like to spearhead in the region.
“This innovative funding and partnership is something we will replicate here and in other parts of the U.S.,” added Galena Apartments lead developer Neal Drobenare.