Since 1975, Duane Morris has assisted clients to structure, implement and complete government-supported low-income housing projects.
We have handled all types of tax-driven real estate investments, including historic rehabilitation tax credit transactions, federal and state low-income housing tax credits (LIHTC), real estate tax abatements and tax-exempt bond financing. Through our representation of for-profit developers, nonprofit organizations, syndicators, banks and underwriters and bond counsel engagements, our Affordable Housing Practice Group has been involved in the financing of more than 1,000 projects consisting of more than 100,000 housing units in 18 states.
We represent public housing authorities, including the Philadelphia Housing Authority, City of Camden Housing Authority and the Millville Housing Authority, in the development of public housing which combines federal low-income housing tax credits with other federal and state subsidy programs.
Duane Morris attorneys represent Community Development Entities, investors and developers in projects which utilize federal New Markets Tax Credit and other subsidy programs. We have represented investors in complex New Markets transactions which have combined federal New Markets Tax Credit with tax-exempt bonds, and transactions which have involved multiple layers of subsidies including Brownfields Grants and tax increment financing.
From our initial concentration in the mid-Atlantic states, we have expanded our services to provide assistance on projects across the country utilizing our offices in numerous U.S. cities, including the major financial centers.
We often work closely with other Duane Morris practice groups, such as corporate, finance, real estate, business reorganization and financial restructuring and tax, to assist our clients in solving problems. In addition, our lawyers frequently coordinate their work with that of our clients' government relations consultants, including Duane Morris' affiliate Duane Morris Government Strategies.
Affordable Housing Services
We assist clients in all types and phases of projects, including:
- Obtaining initial site control and application to the state housing credit allocation authority through to lender and investor closing.
- Advising during the project on regulatory compliance matters and evaluating refinancing, disposition and preservation opportunities.
- Assisting following project completion in areas such as securing permits leading to a certificate of occupancy and placement of the project into service.
Other specific ways in which we assist clients include:
- Negotiating and providing tax opinions - we have worked with a range of investors, including publicly traded funds having individual investors and privately held funds having corporate investors and financial institutions. Tax credits from projects we have represented have been sold to funds created by numerous groups.
- Creatively concluding transactions - using the federal historic rehabilitation tax credit program, neighborhood assistance, Welfare-to-Work and work opportunity tax credits, community development corporation tax credits and enterprise zone state tax credit programs. We represent clients in the formation of qualified community development entities and their applications for allocations of the New Markets Tax Credit.
- Working with virtually all affordable housing and related programs - including historic, four percent and nine percent low-income housing tax credits, FHA insurance programs, Section 8 rental assistance programs, Section 202 senior citizen assistance programs and others.
- Acting as special counsel - in different transactions we have acted as bond counsel, underwriter's counsel and trustee and mortgage servicer counsel, or developer/borrower's counsel in public finance transactions. We have handled a variety of transactions in these capacities, including:
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Tax-exempt bond financed, FHA-insured mortgage transactions
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Project-based Section 8 transactions
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Section 236 Decouplings
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Mixed financed tax credit developments
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Market rate 80/20 transactions
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Assisted living transactions, which combine housing credits with the Medicaid waiver program
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HOPE VI transactions and other four percent low-income housing tax credit transactions
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Bank-qualified and larger housing bond financings for 501(c)(3) entities and governments
Representative New Markets Tax Credit Transactions
- Represented the Diocese of Fort Wayne-South Bend, Inc. in connection with the development of its $35 million St. Joseph?s High School through the federal New Markets Tax Credit program. PNC Bank and Raza Development Fund provided new markets tax credit equity, and PNC Bank invested in the tax credits generated by the development of the school.
- Represented PNC Bank in connection with its investment in federal new markets tax credits generated by the $10 million expansion of the Blue Ridge Medical Center in Arrington, Va.
- Represented the Community Loan Fund of New Jersey, Inc. in connection with the deployment of its federal new markets tax credit allocation for the development of a $40 million student center by Saint Peter?s College in Jersey City, N.J. Provident Bank provided the new markets tax credit leverage loan with the purchase of tax-exempt bonds issued by the New Jersey Economic Development Authority, and Wells Fargo invested in the tax credits generated by the project.
- Represented Western Lodging LLC in the closing of $7.6 million of Recovery Zone Bonds, which will be leveraged with tax increment financing and equity through the federal New Markets Tax Credit Program for the development of a 130-unit Hilton hotel in Ogden City, Utah. U.S. Bank purchased the bonds and will purchase the tax credits.
- Represented RAIT Financial Trust, a publicly traded real estate investment trust, in connection with the $55 million redevelopment of its PlazAmericas™ Mall in Houston, Texas, through the Federal New Markets Tax Credit program. U.S. Bank provided the tax-credit equity, and the Urban Development Fund and the Texas Mezzanine Fund, Inc. provided federal new markets tax-credit authority.
- Represented the Asian Arts Initiative in connection with the acquisition and redevelopment of its new headquarters through the Federal New Markets Tax Credit program. Wells Fargo Bank provided the federal new markets tax-credit allocation and the tax-credit equity for the transaction.
- Represented the Community Loan Fund of New Jersey, Inc. in connection with the use of its Federal New Markets Tax Credit allocation for the development of a $128 million mixed-use project in New Brunswick, New Jersey. Build America Bonds were leveraged through the Federal New Markets Tax Credit structure.
- Represented Beneficial Savings Bank in connection with a $21.7 million leveraged loan to an investment fund of U.S. Bank. The fund advanced the loan, together with New Markets Tax Credit equity, to Campus Apartments to develop a 225-unit Homewood Suites extended-stay hotel near the campus of the University of Pennsylvania.
- Represented The Salvation Army in connection with the enhancement of $45 million of Kroc Trust funds through the federal New Markets Tax Credit Program to generate $17 million of additional tax-credit equity for the development of the Ray and Joan Kroc Corps Community Center in Chicago, Ill. Five community-development entities provided tax-credit allocation for the project, and JPMorgan Chase Bank, N.A. invested in the tax credits generated from the transaction.
- Represented the Lower Eastside Girls Club of New York, Inc. in a transaction to fund the development of its new headquarters through the federal New Markets Tax Credit Program. JPMorgan Chase and Bank of America provided $5 million in tax-credit equity toward the $20 million development budget for the project, and the City of New York provided a $9.6 million grant to the club.
- Represented The Salvation Army in the closing of two new market tax-credit transactions with tax-credit investor JPMorgan Chase Bank, N.A. for the development of Kroc Corps Community Centers in Quincy, Ill. and South Bend, Ind. The two transactions involved $67 million of federal New Markets Tax Credit authority.
- Represented an investor in federal New Markets Tax Credits generated from the development of a mixed-use project at an urban university.
- Represented an investor in federal New Markets Tax Credits generated from the development of a medical center in which the leverage loan consisted of tax-exempt bond proceeds.
- Representation of a nonprofit organization in the development of a community center through the leveraging of its capital funds through the federal New Markets Tax Credit Program.
- Representation of a certified community development entity in the deployment of its allocation of federal New Markets Tax Credit authority.
- Representation of certified community development entities in the preparation and submission to the CDFI Fund of applications for federal New Markets Tax Credit authority.
A more detailed discussion of our capabilities in these various areas is available:
Tax Credit Transactions
HUD/FHA Mortgage Insurance Programs
Section 8 and Mark-to-Market Programs
Public Housing Mixed Finance and HOPE VI
Housing Bonds
Nonprofit Organizations
State and Local Programs
Neighborhood Economic Development
Fair Housing Practice
Representative Client Transactions
Our Affordable Housing lawyers assist clients in all aspects of affordable housing development including acquisition, land use and financing. Listed below are clients and participants involved in our affordable housing matters:
Associated Financial Corporation
Alliant Capital
Apollo Housing Capital
Arcand Company
Banc One Capital Markets, Inc.
Boston Capital Partners, Inc.
Boston Financial Group
Broad Housing Fund
Chicago Equity Fund
Chicago Reinvestment Fund
Conifer Realty LLC
East Coast Capital
Enterprise Social Investment Corp.
Fannie Mae
First Chicago Leasing
Franklin Capital
Fund America Equities Corporation
Heartland Properties
Illinois Equity Fund
Ithan Capital Partners
John Hancock Mutual Life Insurance Company
Lehman Housing Capital, Inc.
McDonald & Company
Mercantile Bank
Michaels Development
National Partnership Investment Corporation
National Equity Fund
Paramount Financial
Pennrose Affordable Housing Fund
Pennrose Properties
Pennsylvania Housing Opportunity Fund, Ltd.
Pioneer Bankcorp
PNC Bank, N.A.
Related Capital Company
Sovereign Bank
The Sterling Companies
Summit Tax Credit Investors
WNC & Associates
HUD/FHA Mortgage Insurance Programs
Our lawyers are experienced in all aspects of the National Housing Act and Federal Housing Administration programs, regularly advising clients on Government National Mortgage Association (GNMA) mortgaged-backed securities, Federal National Mortgage Association (Fannie Mae) and Federal Home Loan Mortgage Corporation (Freddie Mac) programs, Federal Housing Finance Board (FHFB) lending and Farmer's Home Administration (FmHA) loans.
Clients benefit from our many years of experience working with HUD at both the regional and national levels to achieve creative solutions.
Section 8 and Mark-to-Market Programs
Our Affordable Housing lawyers advise clients on all facets of Section 8 rental assistance programs. In particular, we work closely with those clients managing the expiration and renewal of 20-year contracts, guiding them on the negotiation and structuring of Mark-to-Market mortgages and rents.
Public Housing Mixed Finance and HOPE VI
Clients turn to us for counsel on compliance with the requirements of public housing mixed finance regulations and HOPE VI guidelines and seek our experience in resolving the conflicts created by mixing multiple subsidy programs and financing sources. We regularly assist clients in applying for HOPE VI funding and in structuring and closing the transactions.
As an example, we served as counsel to an equity syndicator of federal low-income housing tax credits in connection with its investment in a mixed finance project involving rental units for market rate tenants, tenants eligible for low-income housing tax credits units and public housing tenants. Our client's capital contributions, paid over time, were to be used to pay off a bridge loan for the project, which was funded from the proceeds of variable rate tax-exempt bonds. The bonds were collateralized by a letter of credit from a large, local bank. To obtain interest rate protection, our client entered into a rate swap agreement with the letter of credit bank. The public housing agency provided mixed-finance project assistance for a designated number of units in the project. The units receiving such assistance must be developed, operated and maintained in accordance with public housing requirements. The mixed-finance aspect of the project entailed resolution of multiple issues among our client, HUD, the local public housing agency, the issuer of the bonds, the project's lenders, the letter of credit provider and other parties to the transaction.
Housing Bonds
The tax-exempt housing bond transactions our attorneys handle include:
- FHA-insured mortgage transactions
- Project-based Section 8 transactions
- Market rate 80/20 and assisted living transactions
- Four percent low-income housing tax credits transactions
- Bank-qualified and larger housing bond financings for 501(c)(3) entities and governments
Nonprofit Organizations
The firm's counsel to nonprofit organizations includes advising on the acquisition, development, management and financing of low- and moderate-income housing. We frequently assist nonprofit clients to structure agreements with for-profit developers.
State and Local Programs
We regularly work with all levels of state and local agencies that provide funding for affordable housing projects throughout the country, including state housing finance agencies and authorities; state and local community development, redevelopment and housing authorities; local housing development corporations; and local, county and other municipal governing councils and boards.
These extensive experiences enable us to facilitate clients' transactions nationwide. Because we routinely evaluate and use state financing support, our lawyers can efficiently guide clients through the layers of state and local requirements so that each transaction complies with HUD restrictions.
Neighborhood Economic Development
Historically, many affordable housing projects included a nonresidential component that added a commercial enterprise to the development and its neighborhood. Recent public policy has focused on the development of employment opportunities as part of Welfare-to-Work and other neighborhood economic development initiatives.
Drawing on substantive experience with many of the same agencies that also handle affordable housing initiatives, our lawyers assist clients in structuring economic development projects in urban neighborhoods, both in and outside of metropolitan, center city areas.
Our counsel includes guidance on HUD's Section 108 mortgage insurance program, the Community Development Block Grant Program, and empowerment zones and enterprise communities. We have also confronted the issues involved in developing home ownership opportunities through employer-assistance programs, Resolution Trust Corporation (RTC) disposition programs, HUD foreclosures, troubled properties and workouts, tax sales and empowerment zone loans for commercial enterprises.
Fair Housing Practice
To comply with the requirements of court decisions and the Fair Housing Act, we assist developers and municipalities in meeting their fair share obligations by drafting affordable housing restrictive covenants and developing affordable housing marketing programs.
Our lawyers have successfully challenged exclusionary municipal zoning regulations and obtained curative amendments on behalf of developers to enable the construction of affordable housing.
Additional Representative Matters
Our lawyers have been involved in various aspects of the following transactions:
100 West Chestnut, Chicago, IL
1100 Green Street Apartments, Philadelphia, PA
60th & Michigan Apartments, Chicago, IL
77 West Huron, Oakwood Apartments, Chicago, IL
805 West Eastwood, Chicago, IL
Abraham Lincoln Center, Chicago, IL
Adolfina Villanueva Townhouses, Philadelphia, PA
All American Gardens, Camden, NJ
Allen Lane Apartments, Philadelphia, PA
Allison Hill, Harrisburg, PA
Anchor Group, Rockford, IL
Anchor House, Chicago, IL
Andover Crossing Apartments, Andover, KS
Arbors of Gahanna, Columbus, OH
Archer Courts Apartments, Chicago, IL
Ardmore House, Ardmore, PA
Barbara Jean Wright Apartments, Chicago, IL
Beckersville Apartments, Beckersville, NJ
Bordentown Affordable Housing Apartments, Bordentown, NJ
Bradford Woods, Peoria, IL
The Brentwood, Philadelphia, PA
Bristol Court, Genesee,MI
Cambridge Village, Lewisville, TX
Canterbury Gardens, University City, MD
Canterbury Place, DeKalb, IL
Cedar Ridge, Borough of Canon, Bradford County, PA
Central Woodlawn Phase II Fund, Chicago, IL
Centre Street Court, Ashland, PA
Church Lane Court, Philadelphia, PA
Cinnamon Lake, Waukegan, IL
Cloisters I and II, Philadelphia, PA
The Club at West Deptford, West Deptford, NJ
Coachman Crossing Apartments, Clearwater, FL
Columbia Colony Senior Residences, Atlanta, GA
Columbia Creek Apartments, Woodstock, GA
Columbia Hotel, Coplay, PA
Columbia Wood Townhomes, Newnan, GA
Cortland Estates, Cortland, IL
Cotton Mills Living Center, Rock Island, IL
Courts of Cicero II & III, Cicero, IL
Cricket Commons, Philadelphia, PA
Crossroads of New Brighton, New Brighton, MN
Diamond Phase I, Philadelphia, PA
Diamond Street Apartments, Philadelphia, PA
Diamond Renaissance, Philadelphia, PA
Dorado Village, Philadelphia, PA
Dunlap School Apartments, Philadelphia, PA
East King Street Apartments, Lancaster, PA
Edina Park Plaza, Edina, MN
Elk Grove Investors, Elk Grove, IL
Englewood Gardens, Chicago, IL
Enon-Toland Newhall Manor, Philadelphia, PA
Evergreen Towers II, Chicago, IL
Fairway Mews Washington Township, Warren County, NJ
Faith Tabernacle Apartments, Chicago, IL
Four Seasons Apartments, Aurora, IL
Fox Pointe Venture, Aurora, IL
Franklin Arms Courts, Ft. Myers, FL
Franklin Square Village, Glendora, Gloucester Township, NJ
Freedom Square Shopping Center, Philadelphia, PA
Friends Rehabilitation Program, Inc., Philadelphia, PA
Galen Terrace, Washington, D.C.
Germano-Millgate Apartments, Chicago, IL
Gettysburg Scattered Site Project, Gettysburg, PA
Governor Hotel Apartments, Harrisburg, PA
Grace Street Investors, Chicago, IL
Hamburg Apartments, Hamburg, PA
Harbor House Apartments, Little Egg Harbor, NJ
Harlem-based Retail and Office Complex for Wachovia Bank, NY
Hawthorn Lakes, Vernon Hills, IL
H.E.L.P. Philadelphia I, Philadelphia, PA
H.E.L.P. Philadelphia II, Philadelphia, PA
High Point Manor, Borough of Frackville, Schuylkill County, PA
High Street Manor, Philadelphia, PA
Hollywood Court, Elizabethville, PA
Hope Plaza Shopping Center, Pottsville, PA
Hope's Crossing Apartments, Toms River, NJ
Humboldt Apartments, Chicago, IL
Imani Homes, Philadelphia, PA
Kenwood Congreget Apartments, Minneapolis, MN
Kingswood Apartments, Willimantic, CT
Kiwanis Manor, L.P., Freeport, IL
La Paz Place, Chicago, IL
Lake Grove Village, Chicago, IL
Lake Village East, Chicago, IL
Lancaster Apartments, Lancaster, PA
Landreth Apartments, Philadelphia, PA
Langston Lane, Washington, D.C.
Liberty House, Phoenixville, PA
Libertyville Towers, Libertyville, IL
Lincoln Park Senior Apartments, Lincoln Park, MI
Lincoln Renaissance, Reading, PA
Lipscomb Square Housing Cooperative, Philadelphia, PA
Livingston Manor Apartments, New Brunswick, NJ
Lombard Heights Apartments, Springfield, MI
Mansion Court, Philadelphia, PA
Mansur Wood Living Center, Carbon Cliff, IL
Mapletree Apartments, Woodstock, IL
Marclare Estates, Dixon, IL
Martinsville I Apartments, Shelbyville, KY
Meadowview Apartments, Blue Island, IL
Millville Housing Authority, NJ
Mt. Rock Commons, Lewistown, PA
Morse Senior Center, Chicago, IL
Mountain House, Arendtsville, PA
The Necho Allen, Pottsville, PA
Neighborhood Restorations Scattered Site Project, Philadelphia, PA
New Mexico HUD Preservation Projects
Nissley Chocolate Factory Apartments, Mount Joy, PA
Normal Street Properties, Chicago, IL
Northlake Farms, Gurnee, IL
Northwest Towers, Chicago, IL
One APM Plaza Apartments, Philadelphia, PA
Onterie Center, Chicago, IL
Opportunities for the Aging Housing II, Philadelphia, PA
Opportunities Towers II, Philadelphia, PA
Orion Four Seasons Apartments, Orion, MI
Osage Estates, Pacific, MO
The Oxford, Oxford, PA
Parkesburg School Apartments, Parkesburg, PA
Parkside Apartments, Philadelphia, PA
Parkway Apartments, Homer City, PA
Park View Terrace Borough of Liverpool, Perry County, PA
Parkwood East, Fort Collins, CO
People's Emergency Center -- Spring Garden Homeless Housing, Philadelphia, PA
Peoria Affordable Housing Initiative, Peoria, IL
Pheasant Run Apartments, Harleysville, PA
Philipsburg Court Apartments, Philipsburg, PA
Pine Grove Apartments, Pine Grove, PA
Prairie View Apartments, Bellwood, IL
Providence Square, New Brunswick, NJ
Queens Family Courthouse Project, NY
Queen Street Courtyard, Lancaster, PA
Racquet Club Apartments, Indiana, PA
Redstone Apartments, Briston, CT
Regent Terrace, Philadelphia, PA
Renaissance Center, Chicago, IL
River Street School, Red Bank, NJ
River West Housing Phase I, Rockford, IL
Rivers Edge, Rockford, IL
Rock Ledge Lock Haven, Clinton County, PA
Rolling Green Apartments, Waukegan, IL
Rowan House, Philadelphia, PA
Saltsburg Apartments, Saltsburg, PA
Sarah Allen, Philadelphia, PA
Sartain School Apartments, Philadelphia, PA
Saw Creek Commons, Troy, PA
Sheridan Plaza, Chicago, IL
Sienna Place Apartments, Adrian, MI
Silver Oaks at Waterford, Aurora, IL
Silver Pond Apartments, Wallingford, CT
Six Street Elderly Apartments, Allentown, PA
Sleeping Giant Apartments, Vernon, CT
South Park Apartments, South Park, PA
Southford Park Apartments, Waterbury, CT
Spring Hill Manor, Borough of Frackville, Schuylkill County, PA
Sunnyside Apartments, Chicago, IL
Tabor Community Center, Lancaster, PA
Tasker Village, Philadelphia, PA
Town and Garden Apartments, Chicago, IL
Trinity House, Berwyn, PA
Trinity Life Gardens, Pueblo, CO
University City Housing Scattered Site Project, Philadelphia, PA
Valley View Terrace, Borough of Halifax, Dauphin County, PA
Venango Family Housing, Philadelphia, PA
Vermilion Gardens Apartments, Danville, IL
Victoria Ridge, Kent, WA
Victory Apartments, Chicago, IL
Victory Senior Center Fund, Joliet, IL
Victory Senior Centre Phase II, Joliet, IL
Village Green Apartments Group, Peoria, IL
Villa at Costa Brava, San Antonio, TX
Wachovia Bank New Markets Tax Credit Transaction, Port Jervis, NY
Water Tower Apartments, Columbia, PA
West Highland Apartments, West Burlington, IA
Westwood Phase II Fund, Chicago, IL
Wheeler Terrace Apartments, Washington, D.C.
White's Run Commons, Indiana, PA
Williamsport Manor Apartments, Williamsport, PA
Willow Court Mount, Carmel, PA
Willowcrest Apartments, Middletown, CT
Willows On Clark Road, Gary, IN
Wind Gap Manor, Wind Gap, PA
Winding Ridge Apartments, Neptune, NJ
Woodlawn Michigan Development, Chicago, IL
Woodlayne Court, Middletown, PA
WTHP Phase II, Chicago, IL
