Metropolitan Development and Housing Agency | Summary Review of Agenda Items for MDHA’s April 13, 2021, Board Meeting
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08 Apr Summary Review of Agenda Items for MDHA’s April 13, 2021, Board Meeting

6a.       PILOT Agreement – Shelby House

Holladay Ventures and Evergreen Real Estate have established a limited partnership, Shelby House 1, LP, to acquire property located at 407 S. 4th St. and redevelop the existing Samaritan Recovery Center as well as construct a 195-unit affordable housing complex on the site.  Shelby House 1, LP has applied for 4% Low Income Housing Tax Credits (LIHTCs) from the Tennessee Housing Development Agency (THDA).   The tax credits will result in an equity amount of $21,550,815.  When completed, the project will provide an updated and modernized 75,000 square foot facility for Samaritan Recovery Center inclusive of 132 single room occupancy (SRO) units for those in treatment.  Additionally, the 195-unit LIHTC-financed affordable housing component will consist of 32 studio units, 149 one-bedroom units, and 14 two-bedroom units.  100% of the units will be subject to income and rent restrictions, the average income restriction will be no greater than 60% of area median income (AMI).

Staff is recommending approval of a PILOT that would require Developer to make a total initial payment of $10,175 in lieu of property taxes after the project is placed in service.  The PILOT would increase by 3% annually over the 10-year life of the agreement.  This PILOT payment was based on review of the site’s projected base year taxes, development budget, operating pro forma, and debt obligations.  MDHA estimates this to be a tax abatement of approximately $488,931 for the first year the property is placed in service.  This would leave MDHA’s annual abatement capacity at $525,230.

6b.      PILOT Agreement  – Riverwood Towers

Alco Properties has established a limited liability limited partnership, APP Riverwood Partners, LLLP and has acquired property located at 621 North Dupont Avenue and plans to rehabilitate a 117-unit affordable senior housing complex called Riverwood Towers.  APP Riverwood Partners LLLP has received an allocation of 9% Low Income Housing Tax Credits (LIHTCs) from the Tennessee Housing Development Agency (THDA).  The tax credits will result in an equity amount of $9,599,040.  When completed, the rehabilitated development will consist of 117 one-bedroom senior housing units.  100% of the units will be subject to income and rent restrictions, the average income restriction will be no greater than 60% of area median income (AMI).

Staff is recommending approval of a PILOT that would require Developer to make a total initial payment of $57,389 in lieu of property taxes after the project is placed in service.  The PILOT would increase by 3% annually over the 10-year life of the agreement.  This PILOT payment was based on review of the site’s projected base year taxes, development budget, operating pro forma, and debt obligations.  MDHA estimates this to be a tax abatement of approximately $56,872 for the first year the property is placed in service.  This would leave MDHA’s annual abatement capacity at $468,353.

6c.       National Housing Trust Fund Grants for Boscobels I – III

Board approval is requested to enter into Declarations of Restrictive Covenants and other agreements for MDHA Envision Cayce properties Mosley on 6th, Manning Place, and Red Oak Flats. For each of the previous three years, MDHA applied for and was awarded competitive grants through the National Housing Trust Fund with Tennessee Housing Development Agency. These agreements benefit MDHA Envision Cayce Properties as follows: Mosley on 6th: $294,252.00; Manning Place: $474,433.00; Red Oak Flats: $483,954.00.

7a.       Award of Project Based Vouchers – Shelby House

MDHA Board approval is being requested for an application for the award of project-based vouchers for a new construction development to be known as Shelby House. The developer, Evan Holladay has submitted a proposal that was awarded $900,000 under a competitive THDA National Housing Trust Fund grant.

The project is located at 0 So 4th St. and 407 So. 4th St. Nashville, TN 37206.The plans are for a total of 474 units, comprised of studio, 1BR and 2BR units. They are requesting a total of 118 PBVs, 48 for Phase I completion in December 2022 and 70 for Phase 2 completion in May 2024.