Real Estate & Construction  November 19, 2014

Affordable housing complex sold, renovations in the works

FORT COLLINS – Villages, a non-profit affordable housing developer operated by the Fort Collins Housing Authority, recently sold its 95-unit apartment complex at 2005 W. Plum St. to a limited liability limited partnership as a way to generate private renovation funds for the aging facility.

FCHA – a quasi-governmental entity that contracts with the U.S. Department of Housing and Urban Development to run various HUD programs locally – and Villages will continue to operate the complex.

The renovations, which are expected to include new roofs, sewer lines, carpeting, a playground, dog park and upgrades to the pool and heating systems, will cost about $5 million. But the total value of the deal to make the renovations come together, conducted under the federal Low Income Housing Tax Credit program, is about $16 million.

Under the deal, RBC Capital Markets provided the private investment necessary for the upgrades and purchased the apartment complex through the entity Village on Plum LLLP. The complex itself was valued at $7.1 million in the deal and the balance of the $16 million goes toward the $5 million in renovations and other expenses like architecture and engineering, loan fees, compliance fees and reserves.

RBC is paid pack over a period of 10 years through federal tax credits. The FCHA, meanwhile, retains a small percentage of ownership as part of the LLLP and has first right of refusal to purchase the complex back in 15 years.

Julie Brewen, executive director of the FCHA, said the Low Income Housing Tax Credit program is one the organization uses frequently to fund new affordable housing or upgrades to existing units. The Village on Plum was built in 1970 and had received only minor upkeep since.

“Now it’s really time to do a substantial renovation, which will essentially get these apartments ready to go for another 20 years,” Brewen said. “It’s our tool for both new affordable housing and preservation of existing.”

Villages purchased the Plum complex about a decade ago, and has it mostly leased. During the renovations, residents will be relocated for a week at a time as the eight buildings are upgraded.

FORT COLLINS – Villages, a non-profit affordable housing developer operated by the Fort Collins Housing Authority, recently sold its 95-unit apartment complex at 2005 W. Plum St. to a limited liability limited partnership as a way to generate private renovation funds for the aging facility.

FCHA – a quasi-governmental entity that contracts with the U.S. Department of Housing and Urban Development to run various HUD programs locally – and Villages will continue to operate the complex.

The renovations, which are expected to include new roofs, sewer lines, carpeting, a playground, dog park and upgrades to the pool and heating systems, will cost…

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