Supporting Residential Housing Development

Invest Atlanta assists with the financing of residential housing developments.

Residential Housing Incentives

One of Invest Atlanta’s core competencies is real estate finance, and we administer several loan programs for the development of workforce housing.

Tax Exempt Bond Financing

Tax exempt bonds are issued by the Urban Residential Finance Authority (the Housing Finance group of Invest Atlanta) to assist with the accomplishment of growth in multifamily housing.

Structure

URFA is empowered to issue tax exempt bonds to make below market interest rate mortgage loans to developers for rental housing provided Internal Revenue Service section 142 requirements are met to ensure that a percentage of the rental units benefit low and moderate-income renters.

Each year URFA receives a tax-exempt bond allocation from GA Department of Community Affairs. URFA serves as a conduit bond issuer. Bonds are issued on a first-come, first-served basis based on availability of allocation. There is no maximum amount of bonds that can be allocated to a single development. Eligible projects must be located within the city of Atlanta.

Any tax-exempt bond funds allocated pursuant to this program must be used to provide permanent financing for the development. The allocation is not intended for short-term financing, or “bridge” financing, or any refinancing, which is not the permanent financing for the development; however, it can be used for construction financing and be taken out by another source under certain conditions.

Eligible Developments

  • New Construction or Acquisition and Rehabilitation. Minimum of 75 units and $5MM in Total Development Costs.
  • Conversion of an existing property not being used for housing
  • 40% of units must be set aside to persons at 60% AMI or 20% of units set aside at 50% AMI. See http://www.huduser.org/portal/datasets/il.html for AMI limits.
  • A minimum of 15% of units must be set aside for market rate tenants with no income restrictions
  • Be located within the City Limits of Atlanta

Use of Funds

  • Bond Financing must be at least 50% of capital stack
  • Cost of Issuance financed by Tax Exempt Bonds cannot exceed 2% of bond amount
  • Affordability period is the greater of 15 years or as long as bonds are outstanding
  • Tax-Exempt bonds can be coupled with 4% LIHTC’s & must be enhanced by letter of credit or by a financial guarantee unless the bonds are sold via private placement or the bonds are rated and the project has a HUD HAP contract of at least 15-years
  • Bond Financing can be used for up to 100% of total development costs provided debt supports a minimum 1.20x DSCR.
  • For Acquisition and Rehabilitation, rehabilitation costs must equal at least 10% of the total project cost

Developer Guidelines

  • Developer must have experience commensurate with scope and size of the project
  • Developer must have a successful track record of property management and marketing
  • All workforce units must be comparable in size and quality to market rate units within the same development. Affordability must be disbursed across unit types and floors.
  • Developer must have financial capacity
  • Development must meet sustainability requirements

Neighborhood Compatibility

  • URFA encourages developers to plan/develop projects that are located in the following areas:
    • Economic Development Priority Areas
    • Qualified Census Tracts
    • Difficult to Develop Zones
    • Within 1/4 mile of MARTA Mass Transit, Atlanta Streetcar, or Atlanta Beltline
    • Within a Tax Allocation Districts (TAD)
  • Development must complement and enhance the existing character of the neighborhood
  • NPU Letter

How To Proceed

Check out our Developer Application Process below for information on how to proceed.

Housing Opportunity Bond Financing

The Housing Opportunity Bond Fund (HOB) was created to provide gap financing to address a growing need for affordable workforce housing units across the income spectrum for homeowners, builders, developers and community housing development organizations in the City of Atlanta.

Structure

Moneys held in the program fund will be used for low interest loans to developers to finance in part the acquisition, construction or renovation of housing. These funds may be used in conjunction with conventional financing, bond financing or other private/public financing to construct and/or rehabilitate residential housing and finance predevelopment and site development costs. No HOB loan may be made or unconditionally committed to be made unless the developer has evidence of a firm commitment letter from funding sources detailing the terms and conditions for the balance of the total costs of the housing development.

The obligation to repay the loan shall be evidenced by a promissory note and shall be secured by a deed to secure debt. Each housing project financed with HOB funds shall be regulated by a land use restriction agreement for a minimum of 15 years. Funding is subject to availability.

Eligible Developments

  • New Construction or Acquisition and Rehabilitation
  • Conversion of an existing property not being used for housing
  • Affordability period is the greater of 15 years or as long as the loan is outstanding
  • Developments must contain set asides of at least twenty percent (20%) of the units of comparable size and finish of the market rate units to persons at 60% of the Area Median Income (“AMI”). See http://www.huduser.org/portal/datasets/il.html for AMI limits.
  • 15% of the units must be set aside for market rate tenants with no income restrictions
  • Be located within the City Limits of Atlanta
  • All workforce units must be comparable in size and quality to market rate units within the same development
  • Project must demonstrate evidence of funding need.

Use of Funds

  • Funds may be leveraged with conventional, bond, or other private or public financing
  • Funds serve as gap/bridge loans only; Will be underwritten based on need
  • Used as second mortgage loan (gap financing)
  • Loan cannot exceed the lesser of $25,000.00 per affordable unit or 20% of the capital stack (excluding fees paid to a developer or its affiliates)

Developer Guidelines

  • Developer must have experience commensurate with scope and size of the project
  • Developer must have success in leveraging additional funds
  • Developer must have a successful track record of property management and marketing
  • Development must meet sustainability requirements

Neighborhood Compatibility

  • URFA encourages developers to plan/develop projects that are located in the following areas:
    • Economic Development Priority Areas
    • Qualified Census Tracts
    • Difficult to Develop Zones
    • Within 1/4 mile of MARTA Mass Transit, Atlanta Streetcar, or Atlanta Beltline
    • Within a Tax Allocation District (TAD)
  • Development must complement and enhance the existing character of the neighborhood
  • NPU Letter

How To Proceed

Check out our Developer Application Process below for information on how to proceed.

Housing Opportunity Bond Financing (CHDO Set-A-Aside)

Financing is available for Community Housing Development Organizations (CDHO) through Housing Opportunity Bond funds.

Community Housing Development Organizations (CHDO) Requirements

  • CHDO must have been designated by the City of Atlanta as of January 1 of the year in which the loan application is submitted.
  • Funds may not exceed 50% of total capital expenditures (excluding fees paid to CHDO or its Affiliates)
  • Funds used to finance the acquisition, construction or renovation of the project
  • CHDO must act as owner, developer or sponsor of the project
  • CHDO must have a 25% profit interest in the development to be a sponsor
  • All affordable units must be comparable in size and quality to market rate units within the same development
  • Funds must be leveraged with conventional, bond or other private or public financing including grants. Leveraged funds must be evidenced through firm commitment from other sources. Funding is subject to availability.

Eligible Developments

  • New Construction or Acquisition and Rehabilitation
  • Conversion of an existing property not being used for housing
  • May be used for rental or homeownership development
  • Serve a population at or below 100% of AMI for families of two or less and 115% of AMI or below for families of three or more for homeownership projects
  • 20% set aside for a population at or below 60% of AMI for rental housing projects. See http://www.huduser.org/portal/datasets/il.html for AMI limits.
  • Be located within the City Limits of Atlanta
  • Project must demonstrate evidence of funding need.

Use of Funds

  • Affordability period is the greater of 15 years or the loan is paid off
  • Used as second mortgage loan (gap financing)
  • Funds cannot exceed 50% of the capital stack for CHDO’s (Excluding developer fees.)
  • CHDOs must obtain, through a firm commitment, a secure funding source for the balance of the total costs of the project

Developer Guidelines

  • City of Atlanta must designate the organization as a community housing development organization (CHDO) as of January 1 of the year in which the CHDO loan is made
  • Be a CHDO who acts as owner, developer, or sponsor of an affordable housing project
  • CHDO must have experience commensurate with scope and size of the project
  • CHDO must have success in leveraging additional funds
  • CHDO must have a successful track record of property management and marketing
  • Development must meet sustainability requirements

Neighborhood Compatibility

  • URFA encourages developers to plan/develop projects that are located in the following areas:
    • Economic Development Priority Areas
    • Qualified Census Tracts
    • Difficult to Develop Zones
    • Within 1/4 mile of MARTA Mass Transit, Atlanta Streetcar, or Atlanta Beltline
    • Within a Tax Allocation District (TAD)
  • Development must complement and enhance the existing character of the neighborhood
  • NPU Letter

How To Proceed

Check out our Developer Application Process below for information on how to proceed.

Vine City Trust Fund Financing

The Community/Housing Development Trust Fund was established in 1989 by the City of Atlanta, the Georgia World Congress Center Authority and Fulton County to support the revitalization of the Vine City and English Avenue communities.

Structure

The City of Atlanta designated the Urban Residential Finance Authority (URFA) as the administrator for the Trust Fund. Through the Trust fund, loans in the total amount of $8 million were made to for–profit, non-profit developers and homebuyers to provide for new and rehabilitated rental housing as well as homeownership opportunities.

The repayment dollars for these loans revolves into a program income account and is used to make additional loans for eligible housing development in Vine City and English Avenue.

Eligible Developments

  • Acquisition, construction, or renovation of multifamily and single family housing
  • Conversion of an existing property not being used for housing
  • For sale housing that sets aside a minimum of 20% of the homes in the development must be marketed and sold to families of two or less not to excess of 100% of AMI and 115% AMI for 3 or more with purchase price less than $252,890 or current 203 FHA limit
  • 20% set aside for a population at or below 80% of AMI for rental housing projects. See http://www.huduser.org/portal/datasets/il.html for AMI limits.
  • Provide for long-term affordability provisions of 15 years or more for rental; 10 years for single family

Use of Funds

  • Funds used as second mortgage loan (gap financing)
  • Funds cannot exceed 50% of the capital stack or $1.5 million
  • Will have an interest rate of up to 4%

Developer Guidelines

  • Developer must have experience commensurate with scope and size of the project
  • Developer must have success in leveraging additional funds
  • Developer must have a successful track record of property management and marketing
  • Must obtain, through a firm commitment, a secure funding source for the balance of the total costs of the project
  • Development must meet sustainability requirements

Neighborhood Compatibility

  • The target area for the Trust Fund is the area bounded by Donald Lee Hollowell Parkway on the north; Joseph Lowery Boulevard on the west; Martin Luther King Jr. Drive, Walnut Street and Beckwith Street as extended to Walker Street on the south and Walker Street, Martin Luther King Jr. Drive and Northside Drive on the east.
  • See map below. The shaded area is the boundary for the Trust Fund
  • NPU Letter

How To Proceed

Check out our Developer Application Process below for information on how to proceed.

Additional Resources

Click here to download.
HOME Investment Partnerships Program Financing

The HOME Investment Partnership Program is a federally funded program that assists in the production and preservation of affordable housing for low to moderate-income families and individuals.

Structure

The program funds costs associated with new construction, acquisition and rehabilitation of rental properties.

The HOME assisted project must meet the affordability requirements for not less than the applicable period specified in the chart below beginning after project completion. The affordability period is based on the HOME investment per unit.

Eligible Developments

  • May finance, in part, the acquisition, construction, or renovation of multifamily housing for low and moderate income families
  • Be located within the City of Atlanta
  • Must have a minimum of 5 HOME-assisted units.
  • All Projects must meet the Model Energy Code
  • May be used for multifamily developments and will not be made or unconditionally committed to be made unless secure funding sources are identified for the balance of the total project cost of the housing project
  • Projects are eligible for a maximum of $40,000 per HOME Assisted Unit
  • Ensure all units receiving HOME assistance must be occupied by households earning no more than 80% of the area median income
  • Ensure at least 20% of the HOME units must be affordable to households earning no more than 50% AMI and 20% at 60% of AMI. See http://www.huduser.org/portal/datasets/il.html for AMI limits.

Use of Funds

  • Funds used as second mortgage loan
  • Will undergo a subsidy layering analysis to determine the minimum amount subsidy needed based on HUD guidelines for HOME Units
  • Will be evidenced by a promissory note and shall be secured by a deed to secure debt; and
  • Will have an interest rate of up to 3%

Developer Guidelines

  • For-profit developers and non-profit developers are eligible to apply for HOME funds
  • Development must meet sustainability requirements

Neighborhood Compatibility

  • Correspond with approved neighborhood revitalization plans
  • NPU Letter

How To Proceed

Check out our Developer Application Process below for information on how to proceed.

Additional Resources

Click here to download.
Atlanta Beltline Affordable Housing Trust Fund (BAHTF)

The Atlanta City Council created a BAHTF to promote the creation and preservation of affordable housing within the Beltline neighborhoods.

Structure

Affordable housing is a critical component of the Beltline development. Grant funds from BAHTF add a necessary, flexible and unprecedented tool to Atlanta’s affordable housing toolkit. These funds can be combined with other affordable housing programs and city incentives and leveraged with private dollars to construct or renovate affordable housing units in the city. The goal of the BAHTF is to create a balanced mix of rental and owner occupied housing units and to encourage the distribution of affordable housing around the beltline.

These grants will be provided to non-profit and for profit multifamily developers offering affordable workforce housing rental units along the Atlanta BeltLine. Grant funds may be used to finance acquisition, construction or renovation of multifamily housing for families at or below 60% of Area Median Income (as defined by the Department of Housing and Urban Development). These grants to developers are enforced by a Land Use Restriction Agreement (LURA). The total amount of the grant dollars may not exceed 30% of the total development costs with a cap of $2.5 million per multifamily development. The developer is required to obtain additional financing from other sources to complete the development.

Projects involving a combination of nonprofit organizations with for profit partners and investors, adhere to the Atlanta BeltLine Design Guidelines, have affordable rental units for persons at or below 30% of AMI and market to public servants (city, county, Atlanta Public School employees) and City of Atlanta residents will be given top priority.

The program components of the BAHTF include

  • Multifamily Rental Developer Incentives
  • Single Family Developer Incentives
  • Community Housing Development Organizations (CHDO) Set-aside for Multifamily Rental
  • Community Housing Development Organizations (CHDO) Set–aside for Single Family Homeownership     

Grants are available to multifamily, single family and CHDO developers from the Beltline Affordable Housing Trust Fund to finance multifamily and single family developments along the Beltline.

BAHTF dollars will only be awarded to those developments that would not be economically feasible without this public subsidy. The amount of funding granted to a specific development may reflect an award of less than 100% of the requested amount based on the assessment of financial need made by Invest Atlanta and other factors as determined by Invest Atlanta.

Verify that your property/parcel is in the Beltline TAD at gis.atlantaga.gov

How To Proceed

Check out our Developer Application Process below for information on how to proceed.

HomeFirst Supportive Housing Fund

A  partnership between the City of Atlanta acting through Invest Atlanta (IA) and the United Way Regional Commission on Homelessness (RCOH) created to capitalize on the community’s success in reducing homelessness counts in Atlanta.

In February 2017, the City of Atlanta announced the $50 million HomeFirst initiative to achieve these goals by investing in proven housing strategies and supportive services and made a bold commitment of $25 million in city funds to match private contributions to the HomeFirst initiative.

2018 Income and Rents Limits

Download the Invest Atlanta Workforce Housing Income Limits and Maximums here:

Developer Application Process

Guiding you through the Residential Development Incentives Application process.

Step 1: Reach out to Invest Atlanta

Contact Invest Atlanta to arrange an initial meeting to discuss the viability of your proposed development for financing.

Step 2: Concept Submission

The concept submission is for developers who have:

  • An idea for a development but are unsure about the funding sources
  • A need for financial consultation on a development project
  • Limited experience with workforce housing developments

While the concept submission is provided to the development community to foster the relationship while a project is in the preliminary stages, it is not required that all developers complete the concept submission. If you are a developer who seeks to understand the process and who needs a comprehensive analysis of your development, please complete the concept submission and contact Alan Ferguson at (404) 614-8290 / aferguson@investatlanta.com or Vickey Roberts at (404) 614-8305 / vroberts@investatlanta.com.

Download it here:

Step 3: Application Submission

The Developer Incentive Application is for developers, who have:

  • All the prerequisites for funding and project underwriting as stated in the 2015 Developer Incentive Program Guidelines
  • Existing experience with Invest Atlanta or GA Dept. of Community Affairs funding

If you are a developer who is ready to proceed toward funding, please complete the Developer Incentive Application. Once the application is completed in its entirety, please contact Alan Ferguson at (404) 614-8290 / aferguson@investatlanta.com or Vickey Roberts at (404) 614-8305 / vroberts@investatlanta.com.

As of August 2018, interested developers are required to submit the application by the first Friday of the preceding month. (For example, for September 2018 consideration, the application is due Friday, August 3, 2018.) The revised transaction process schedule can be found on the “Process Schedule” tab of our applications.  Developers requesting a calendar of application submission dates and key dates within our transaction approval process should email Leanda Robles-Collis at lrcollins@investatlanta.com.

Download the application that applies to you:

To seek Tax-Exempt Bond financing, please complete the Residential Development Incentives Application:

For a project that involves single-family for sale, please complete the Single Family Supplemental Workbook:

If you are pursuing single-family rental projects, small multifamily projects, Lease-Purchase Bonds for multifamily projects, or multifamily projects that do not involve Low-Income Housing Tax Credits (LIHTCs) in need of gap financing, please complete the Scattered Site and Small Rental Development Application:

Submit your application:

Please submit the package electronically on a CD or USB Flash Drive with content, tabs, formatting and order of application. One copy of the completed application on CD or USB Flash Drive shall be submitted to Invest Atlanta, accompanied by the non-refundable application fee.

Step 4: Next steps

Upon receipt of an application, Invest Atlanta staff will review the application for content and completeness. After the application has been reviewed for consistency with Invest Atlanta goals, staff will evaluate and score the application. Invest Atlanta staff will present to the Committee its recommendation for funding. Upon approval for funding by the Committee, the developer will be notified by Invest Atlanta. The developer of approved development will be required to enter into an agreement which outlines the terms, conditions and covenants of the funding source, detailing the disbursement of proceeds. At Invest Atlanta’s sole discretion, a new application and fee may be required if a prior submission was inadequate based on the application submission guidelines.

 

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