Walker & Dunlop, Inc. announced today that it structured $10,129,500 in construction and permanent financing for Spring Flats, the redevelopment of a historic property known as The Hebrew Home. Located in the Petworth neighborhood of Northwest Washington, D.C., the mixed-income development caters primarily to seniors and low-income residents. The project totals 185 units, 88 of which will benefit from the adaptive reuse rehabilitation loan.
Originally constructed in 1925, The Hebrew Home served as a nursing home until 1968, when it was purchased by the District of Columbia and converted into a community health center. Following a decade-long period of vacancy from 2009 to present, the adaptive re-use project will convert the building into new affordable apartment units. The restoration will include energy-efficient upgrades and is designed to achieve a LEED certification upon completion, which is scheduled for the summer of 2020.
Led by Rob Rotach, Senior Director in the FHA Finance group, Walker & Dunlop structured the financing with a combination of funding sources. The team worked to coordinate capital from nine percent and four percent Low Income Housing Tax Credit (LIHTC) equity, loan proceeds from the United States Department of Housing and Urban Development’s (HUD) 231 loan program, as well as cash-collateralized tax-exempt bond proceeds and subordinate debt from the DC Department of Housing and Community Development. The financing terms included a 40-year, fully amortizing, fixed rate loan for the property co-developers, Victory Housing, Brinshore Development, and Banc of America CDC.
“This transformative redevelopment is a unique opportunity for Victory to build on our mission while putting a great community asset back to use for affordable housing,” said Leila Finucane, President of Victory Housing. “We greatly appreciate the work of all our partners and the input of the community in making this possible.”
Mr. Rotach remarked, “This was a complex financing with a lot of moving parts. We were fortunate to be working with such dedicated and experienced partners in Victory Housing, Brinshore, and Banc of America CDC.” He added, “Twinning nine percent and four percent LIHTCs has been an increasingly popular deal structure that maximizes the limited resources available to make these types of projects a reality. During these tumultuous times, the New York and Chicago HUD offices came together to work with Walker & Dunlop on this transaction. Both were instrumental in our success and we are grateful for their efforts.”
Walker & Dunlop is one of the largest multifamily lenders in the country and is the top non-bank affordable lenders in the United States.1 In 2019 alone, Walker & Dunlop closed over $1.3 billion in transaction volume for affordable properties. For more information about Walker & Dunlop’s activity in the affordable housing space, read the following press releases:
- Walker & Dunlop Helps Preserve 741 Affordable Units with $45 Million Financing
- Walker & Dunlop Provides $7 Million in Financing for Lakeland Development, Continuing its Commitment to Affordable Housing
- Walker & Dunlop Structures $161 Million in Acquisition Financing for Student Housing Portfolio
About Walker & Dunlop
Walker & Dunlop headquartered in Bethesda, Maryland, is one of the largest commercial real estate finance companies in the United States. The company provides a comprehensive range of capital solutions for all commercial real estate asset classes, as well as investment sales brokerage services to owners of multifamily properties. Walker & Dunlop is included on the S&P SmallCap 600 Index and was ranked as one of FORTUNE Magazine’s Fastest Growing Companies in 2014, 2017, and 2018. Walker & Dunlop’s 850+ professionals in 40 offices across the nation have an unyielding commitment to client satisfaction.
About Victory Housing
Victory Housing, Inc. is a nonprofit housing development arm of the Archdiocese of Washington with a mission to sustainably and compassionately provide affordable housing and related social services primarily to low- and moderate-income senior citizens and families, without discrimination. Victory Housing has developed 31 properties comprising 2280 units.
1 Mortgage Bankers Association’s 2019 Commercial/Multifamily Origination Rankings