Glendale, to keep the funds deployed over seven years,” said Loveman. “While we had originally been working on the funding for Fair Oaks Court in Pasadena, the city of Glendale is a big hero because of how quickly it came to the table and committed its funds and arranged financing to make this deal possible,” said Loveman.
Glendale had to approve the sale of the two project sites to HHP, approve a disposition and development agreement, make a loan commitment to the projects, and enter into an intercreditor agreement with the city of Pasadena—all almost two years before groundbreaking would occur in Glendale.
Loveman and Bystry agreed that the deal was complex, but as Bystry noted: “The benefit we achieved in the level of affordability we could get using NMTCs is unprecedented. It’s a project we’re extremely proud of. Given the high cost of housing in Southern California, this is the most affordable project we’ve ever done.”
Among Fair Oaks Court’s 44 units are 37 that will be sold to low- and moderate-income households (defined as households with incomes from 80 to 120 percent of area median income). There are four market-rate units, which are all detached, rehabbed historic houses, and three houses categorized as “workforce” housing, for households with incomes from 120 percent to 180 percent of area median income.
Soft funding helped
The NMTCs brought a total of $6,266,000 into the project, only $930,000 of which has to be repaid. To meet the required seven- year investment period, only $2.9 million of the NMTC equity will remain in the Fair Oaks project, and the remaining $2.4 million will move on to the Glendale projects. Low-income buyers will receive $78,378 from NMTC-generated equity, which does not