Columbus, OH February 13, 2017 – RED Mortgage Capital, LLC, the mortgage banking arm of RED Capital Group, LLC, announced today that it has closed a $31.75M FHA Section 221(d)(4) loan and RED Capital Markets, LLC, the investment banking arm of RED Capital Group, LLC, underwrote $39.73M of tax-exempt bonds for the rehabilitation of Courtyard at Riverview in Philadelphia, PA. This project is being redeveloped by The Michaels Organization, a long-standing client of RED’s, in partnership with the Philadelphia Housing Authority. The bonds were issued by the Pennsylvania Housing Finance Agency.
The transaction involved careful coordination between bonds, tax credits, sub-debt, FHA and the Housing Authority. It was processed in conformance with the MAP guidelines for properties seeking FHA Section 221(d)(4) mortgage insurance in conjunction with the Rental Assistance Demonstration (RAD) program. The project also included both senior and family units.
This complex transaction represents one of the largest RAD projects in Pennsylvania and a significant deal for RAD transactions across the country.
“We are always happy to work with our long-time partner, the Michaels Organization, to revitalize a property,” stated Matt Napoleon, Managing Director for RED. “Because RED provided the Bond Underwriting and is the FHA lender in the deal, we were able to provide continuity to the process that allowed us to close in record time. It was through careful coordination with our team, the Department of Housing and Urban Development (HUD) team and our partners at The Michaels Organization that we could make this a reality in a short time frame.”
Courtyard at Riverview sits on approximately 13 acres and is a 470 unit multifamily complex that includes a 26 story high-rise and 37 two-story townhouse buildings. The complex includes 165 senior unit high rise apartments and 305 modern low-rise homes.
“We are proud to be an integral part of the revitalization of this area in Philadelphia, enhancing the community and improving the lives of our residents,” stated John J. O’Donnell, President of The Michaels Organization. “The RED team did a great job of streamlining the process of this very complex deal to close this RAD loan within record time and help The Michaels Organization achieves its goals.”
The RAD program through HUD seeks to preserve public housing by providing Public Housing Agencies (PHAs) with access to more stable funding to make needed improvements to properties. It allows public housing agencies to leverage public and private debt and equity to reinvest in the public housing stock. To learn more about the RAD program click here.
