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KANSAS CITY, MO-An affiliate of Eagle Point Enterprises LLC has obtained $55 million in financing to buy and rehabilitate three historic properties containing 303 affordable rental apartments in the midtown area. Originally built in the 1920s, the properties stood as hotels until they were turned into multifamily rental properties known as Georgian Court, Bainbridge Apartments and Linda Vista Apartments. In the 1970s, they were converted into affordable housing units.
CharterMac Capital LLC provided $47.2 million in equity for federal and state tax credits generated by the rehabilitation, while CharterMac provided $29 million in short-term construction-period financing and $8.4 million in long-term debt financing through the purchase of both taxable and tax-exempt bonds issued by the Missouri Housing Development Commission.
DJ Nelson, senior vice president of Eagle Point, says what makes the deal unique is the use of federal and state historic preservation tax credits, which combined represent $18 million of the $47.2 million in equity proceeds. To qualify for such historic preservation tax credits, a property must be listed on the National Register of Historic Places, must involve a substantial rehabilitation, and must meet approval by the Secretary of the Interior's strict standards for rehabilitation.
"Like any property, historic buildings need capital improvements to preserve their ongoing marketability and physical integrity," Nelson says. "It is important that these historic properties remain an important part of the community, with residents proud to be a part of their history and proud to be a positive influence in the revitalization of this community."
The historic properties contain primarily one- and two-bedroom apartment units ranging in size from 487 sf to 704 sf. All 303 units are provided rental assistance through HUD for a minimum term of 20 years, allowing residents to pay 30% of their income toward rent and tenant-paid utilities. The rehabilitation is expected to be completed in the fourth quarter of 2008.
Portland, ME-based Eagle Point Enterprises, LLC was founded in 2000 by the partners of the Signal Group, a national real estate consulting firm, for the express purpose of acquiring, renovating, and preserving affordable, multi-family housing properties. This transaction marks the ninth Eagle Point project to be financed by CharterMac and its affiliates.
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