WASHINGTON--(BUSINESS WIRE)--NewPoint Impact Fund I (the “Fund”) has provided $13.3 million in 501(c)(3) bond financing to facilitate the acquisition, rehabilitation, and recapitalization of Ridgecrest Apartments Phase II, a 128-unit affordable housing community located in the Anacostia submarket of southeast Washington D.C. The borrower is The NHP Foundation (“NHPF”), a New York-based not-for-profit developer that specializes in affordable housing. NewPoint Real Estate Capital (“NewPoint”) Senior Managing Director Bryan Dickson arranged and structured the tax-exempt construction-to-permanent phased bond financing through the NewPoint Impact platform. The transaction represents the inaugural residential rehab financed by the District of Columbia’s Revenue Bond program supported through a tax-exempt 501(c)(3) bond transaction.
“This creative transaction involved a sophisticated joint effort between NewPoint, NHPF, DC Green Bank, and local agencies, including the Office of the Deputy Mayor for Planning and Economic Development, Department of Housing and Community Development, and District of Columbia Housing Authority,” Dickson said. “A willingness to explore an alternative solution in place of LIHTC resulted in a smart and efficient construction-to-perm financing that will revitalize an aging asset and create long-term affordable and supportive housing.”
The $13.3 million in Fund financing will be combined with $29.2 million in soft debt and grants from DC Department of Housing and Community Development (DHCD), including Housing Production Trust Funds (HPTF), $2.3 million in subordinate debt from DC Green Bank to execute the rehabilitation, as well as $2.2 million in deferred fees and other sources. Collectively, these resources will support long-term affordability and significant energy-efficiency improvements.
Ridgecrest Phase II was previously operated as part of the larger Ridgecrest Village, a 1951-built development that was purchased by NHPF in 2019. After recapitalization, 20% of Ridgecrest Phase II’s units will be restricted at 30% of AMI to serve as permanent supportive housing. The remaining 80% of units will be restricted at 50%, 60% and 80% of AMI per HPTF rent thresholds.
Ridgecrest Phase II is among the first rehab projects of its size to transition to fully electric energy sources, aligning with District of Columbia goals for decarbonization. The aggressive plan to enhance energy efficiency is traditionally cost-prohibitive for affordable housing communities, but made possible through the transaction’s structure and District funding.
“This closing marks a major milestone for the District of Columbia – it was funded without low-income housing tax credits and is the District’s first 501(c)(3) municipal bond issuance funded by the Office of the Mayor for Planning and Economic Development to rehabilitate residential housing,” said Pamela Lee, Assistant Vice President of Development at NHPF. “The close collaboration between public and private groups sets a new standard for successful deal execution.”
The garden-style apartment community features a mix of two-bedroom and three-bedroom units ranging in size from 850 to 1,000 square feet. Community amenities include a laundry room, a playground, and surface parking. In addition, residents have access to the adjacent Villages at Parklands Splash Park, an 80,000-square-foot waterpark and pool.
About The NHP Foundation
Headquartered in New York City with offices in Washington, D.C., Baltimore and Chicago, IL, The NHP Foundation (NHPF) was launched on January 30, 1989, as a publicly supported 501(c)(3) not-for-profit real estate corporation. NHPF is dedicated to preserving and creating sustainable, service-enriched multifamily housing, and single-family homes that are both affordable to low and moderate income families and seniors, and beneficial to their communities. NHPF’s Construction Management Group provides in-house resources dedicated to infrastructure review, infrastructure development and cost management. Through Family-Centered Coaching, NHPF’s subsidiary Operation Pathways engages with, and assists, families experiencing poverty and other hardship, to problem-solve together. Through partnerships with major financial institutions, the public sector, faith-based initiatives, and other not-for-profit organizations, NHPF has 59 properties in 16 states and the District of Columbia. For more information, please visit www.nhpfoundation.org.
About NewPoint Real Estate Capital
NewPoint is a prominent commercial real estate finance company delivering lending solutions to investors of multifamily, affordable housing, seniors housing, healthcare, and manufactured housing properties nationwide. In addition to NewPoint Impact and its Proprietary Lending platform, NewPoint is a Fannie Mae DUS®, Freddie Mac Optigo®, and FHA/HUD MAP and LEAN Lender, and also provides third-party placement solutions. For more information, please visit www.newpoint.com.
About NewPoint Impact Fund I
The Fund primarily invests in tax-exempt mortgage revenue bonds that finance affordable housing projects which are subsidized by LIHTC and owned by 501(c)(3) organizations or by for-profit developers that are subject to ongoing tenant income or rental restrictions. Additionally, the Fund may invest in taxable investments related to the bonds or the affordable rental housing sector in general, including loans, taxable mortgage revenue bonds, debt used to reposition a property in anticipation of a future LIHTC recapitalization or short-term bridge loans secured by the future capital commitments of a LIHTC investor.
