Florida Housing Finance Corporation
Credit Underwriting Report
Heritage Park at Crane Creek
State Apartment Incentive Loan Program (“SAIL”), Extremely Low Income
Loan (“ELI”) and Competitive 9% Housing Credits (“HC”)
RFA 2018-103 (2018-344CS)
Housing Credit and SAIL Financing for Homeless Housing Developments
Located in Medium and Large Counties
Section A: Report Summary
Section B: SAIL and ELI Loan Special and General Conditions and
HC Allocation Recommendation and Contingencies
Section C: Supporting Information and Schedules
Prepared by
First Housing Development Corporation of Florida
FINAL REPORT
October 17, 2019
Exhibit G
Page 1 of 48
FHDC
October 17, 2019
Heritage Park at Crane Creek
TABLE OF CONTENTS
Page
Section A
Report Summary
Recommendation A1-A11
Overview A12-A16
Use of Funds A17-A21
Operating Pro Forma A22-A24
Section B
SAIL and ELI Loan Special and General Conditions B1-B9
HC Allocation Recommendation and Contingencies B10
Section C
Supporting Information and Schedules
Additional Development & Third Party Information C1-C8
Applicant Information C9-C11
Guarantor Information C12
General Contractor Information C13-C14
Syndicator Information C15
Property Management Information C16-C17
Exhibits
15 Year Pro Forma 1.
Housing Credit Allocation 2. 1-2
Description of Features and Amenities 3. 1-5
Completion and Issues Checklist 4. 1-2
Exhibit G
Page 2 of 48
SAIL, ELI & HC CREDIT UNDERWRITING REPORT FHDC
October 17, 2019
Section A
Report Summary
Exhibit G
Page 3 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page A-1
October 17, 2019
Recommendation
First Housing Development Corporation of Florida (“First Housing”, “FHDC”, or “Servicer”)
recommends a SAIL Loan in the amount of $4,228,900, an ELI Loan in the amount of $240,600,
and an annual HC Allocation of $1,510,000 to finance the construction and permanent financing
of Heritage Park at Crane Creek (“Development”).
Development Name:
RFA/Program Numbers: /
Address:
City: Zip Code: County: County Size:
Development Category: Development Type:
Construction Type:
Demographic Commitment:
Primary: of the Units
Unit Composition:
# of ELI Units: ELI Units Are Restricted to AMI, or less. Total # of units with PBRA?
# of Link Units: Are the Link Units Demographically Restricted? # of NHTF Units:
Heritage Park at Crane Creek
DEVELOPMENT & SET-ASIDES
2018-344CS
New Construction
Mid-Rise (4 Stories)
Wood Framed
RFA 2018-103
Medium
Brevard
32901
Melbourne
2550 Grant Street
for
51.85%
0
0
Homeless
17
0
35%
Palm Bay-Melbourne-Titusville MSA, Brevard County, FL
657$
800$
406$
406$
787$
422$
787$
787$
Net
Restricted
Rents
353$
657$
657$
60%
60%
800$
406$
406$
787$
Annual Rental
Income
31,968$
$89
78,840$
86,599108
60%
1,0792.0 2
2 2.0
2 2.0
2
3 2.0
Market3
3 2.0
3 2.0
Market
1,079
2.0
1
3
2
60%1,079
1,079
$876
$876
897$ $1,011
Bed
Rooms
1.0
2.0
Bath
Rooms
1.0
PBRA
Contr
Rents
1
1
1
1
1.0
1.0
10
13
2 8
114$
114$
18
$589
$1,011
$729
12
13
114$
1,100$
897$
471$
471$
475$
897$
618
935
935
935
935
$89
AMI%
35%
35%
Utility
Allow.
$72
Gross HC
Rent
$425
$729
618
618
Applicant
Rents
333$
333$
$72
$7218
$89
Units
Low
HOME
Rents
60%
60%
8
High
HOME
Rents
Square
Feet
Market
35% $511
618
950$
787$
406$
406$
71,928$
Appraiser
Rents
333$
333$
657$
800$
38,976$
87,696$
113,328$
148,200$
124,800$
950$
CU Rents
333$
333$
657$
5,652$
16,956$
950$
21,528$
26,400$
766,272$
471$
471$
897$
1,100$ 1,100$
471$
471$
897$
Exhibit G
Page 4 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page A-2
October 17, 2019
The Applicant has selected the Homeless demographic where at least 70%, but less than 80%, of
the units must be set-aside for Homeless individuals and families and at least 20% of the units for
Persons with Special Needs (which may be the same units set aside for Homeless individuals and
families). Since the Application, the Applicant submitted a petition for variance from provisions
of Request for Applications 2018-103 (“RFA”), which was approved at the March 22, 2019 Board
Meeting. The Applicant requested to increase the number of units from 80 to 108, and to set aside
51.85% of the total units (56 units) for Homeless individuals and families, rather than the 70% set-
aside requirement of the RFA. Additionally, the Applicant requested a waiver to set aside 14.81%
of the total units (16 units) for Persons with Special Needs, rather than the 20% set-aside
requirement of the RFA. Please refer to Waiver Requests/Special Conditions for additional
information regarding the petition.
The Applicant has selected to serve the following:
· Persons receiving benefits under the Social Security Disability Insurance (“SSDI”)
program or the Supplemental Security Income (“SSI”) program or from veterans’ disability
benefits.
· Adult persons requiring independent living services in order to maintain housing or
develop independent living skills and who have a Disabling Condition that neither
currently impairs nor is likely to impair their physical mobility, such as persons with a
mental illness.
The Applicant must irrevocably commit to the Homeless demographic commitment selected for a
minimum of 50 years. The Persons with Special Needs commitment is required for a minimum of
12 years. After the initial 12 years, the Applicant may submit a request to FHFC that allows the
Applicant to commit to a different population(s) demographic commitment provided 2.b. of
Exhibit A if the appropriate Level 1 or Level 2 Accessibility Requirements are met at the
Development for the population(s).
Based on the RFA, the Applicant must commit to set aside 15% of the total units (17 units) in the
Development to serve ELI Households. The Applicant is eligible for ELI Loan Funding. The
required ELI Set-Aside units cannot exceed 5 percent of the total units for ELI Loan Funding (in
this case the Applicant has selected 4 units, based on the original number of units).
ELI Loan Amount per Bedroom Count: Brevard County
Two (2) One-Bedroom units at $55,300 = $110,600
Two (2) Two-Bedroom unit at $65,000 = $130,000
Total = $240,600
Exhibit G
Page 5 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page A-3
October 17, 2019
The ELI Set-Aside Units are required for a minimum of 50 years. However, after 15 years, all of
the ELI Set-Aside Units associated with the ELI Loan Funding (4 units) may convert to serve
residents at or below 60% of Average Median Income (“AMI”). However, the ELI Set-Aside Units
that were not associated with the ELI Funding will remain ELI Set Aside Units for the entire
Compliance Period of 50 Years.
Since 51.85% of the units (56 units) are to be set aside for individuals and/or families that meet
the definition of Homeless and 14.81% of the total units (16 units) are to be set aside for Persons
with Special Needs. The Persons with Special Needs set aside units may be the same units set aside
for Homeless individuals and families.
All Applicants must meet the following requirements specific to its commitment, pursuant to the
RFA, to serve Homeless households:
1. Have an executed agreement to participate in the Continuum of Care’s Homeless
Management Information System (HMIS); and will contribute data on the Development’s
tenants to the Continuum of Care’s HMIS data system or, if serving Survivors of Domestic
Violence, is providing aggregate data reports to the Continuum of Care. The executed
agreement shall be required at least 6 months prior to the expected placed in service date.
2. Commit to be a housing provider in the Continuum of Care’s Homeless Coordinated Entry
system as required by the U.S. Department of Housing and Urban Development.
Buildings: Residential - Non-Residential -
Parking: Parking Spaces - Accessible Spaces -
Set Asides:
Absorption Rate:
units per month for
months.
Occupancy Rate at Stabilization: Physical Occupancy Economic Occupancy
Occupancy Comments
DDA: QCT: Multi-Phase Boost: QAP Boost:
Site Acreage: Density: Flood Zone Designation:
Zoning: Flood Insurance Required?:
Program
1
93.00%
N/A
5.0
No
Yes
X
17
35%
R-2
Term (Years)
% AMI
N/A - New Construction
15.08
7.16
No
No
50
SAIL/ELI/HC
15.7%
60%
207 30
58.4%
# of Units
% of Units
50
94.00%
25
0
SAIL/HC
63
Exhibit G
Page 6 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page A-4
October 17, 2019
Applicant/Borrower:
% Owners hip
99.9900%Enterprise Housing Credit Investments and/or its assignees ("Enterprise")
General Partner
Rosemary Village Apartments, LLLP
0.0100%
DEVELOPMENT TEAM
C4 Rosemary, LLC
C4 Rosemary, LLC
Developer:
CC Guarantor 2:
OD Guarantor 3:
Rosemary Village Apartments, LLLP
C4 Rosemary, LLC
OD Guarantor 1:
Construction Completion
Guarantor(s):
Limited Partner
CC Guarantor 3:
Rosemary Village Apartments, LLLP
Carrfour
Carrfour
Operating Deficit
Guarantor(s):
Syndicator:
CC Guarantor 1:
Meridian Appraisal Group, Inc. ("Meridian")
Royal American Construction Company, Inc. ("Royal American")
Carrfour Supportive Housing, Inc. ("Carrfour")
Behar Font & Partners, PA
Market Study Provider:
Enterprise
OD Guarantor 2:
Crossroads Management, LLC ("Crossroads")
Integra Realty Recources - Tampa Bay ("Integra")
General Contractor 1:
Appraiser:
Management Company:
Architect:
Exhibit G
Page 7 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page A-5
October 17, 2019
Steadytown,
Steadytown
Lender
0.00%
$0
FHFC - SAIL
FHFC - ELI
$4,228,900 $240,600 $3,000,000
$ -
2nd Source
1st Source
N/A
17.9
19% N/A
Loan to Cost - SAIL
Only
Operating Deficit &
Debt Service Reserves
Debt Service
Coverage
Restricted Market
Financing LTV
# of Months covered
by the Reserves
N/AN/A
4.13 1.07
55% 55%
30 -
-
0.00%0.00% 0.00%
15
-
15
0.00%
Second
Other5th Source4th Source3rd Source
0.48% 0.00% 0.00% 0.00%
-
- - 30
34%
First
34% 34%
33% 55%
19% 20%
Third Fourth Fifth
4.60 1.07
1.07
$865,529
159% 168%
31%
Lender/Grantor
Amount
Underwritten Interest
Rate
All In Interest Rate
Loan Term
281%
0.48%
PERMANENT FINANCING INFORMATION
Lien Position
Market Rate/Market
Financing LTV
Amortizati on
Loan to Cost -
Cumulative
281% 281%
Per Rule Chapter 67-48.0072(11), the maximum debt service coverage (“DSC”) shall be 1.50 to
1.00 for the SAIL Loan, including all superior mortgages. The DSC is 4.60 to 1.00, which exceeds
the maximum threshold. In extenuating circumstances, such as when the Development has deep
or short-term subsidy, the DSC may exceed 1.50x, if the Credit Underwriter’s favorable
recommendation is supported by the projected cash flow analysis as illustrated in Exhibit 1. In this
instance, the above extenuating circumstances apply, based on the deep subsidy of 17 units at or
below 35% of the AMI, exceeding the maximum threshold is permitted.
Exhibit G
Page 8 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page A-6
October 17, 2019
$0.9375
Housing Credit (HC) Syndication Price
Year 15 Pro Forma Income Escalation Rate
Deferred Developer Fee
Market Rent/Market Financing Stabili zed Value
HC Annual Allocation - Initial Award
$1,510,000
Rent Restri cted Market Financing Stabilized Value
HC Annual Allocation - Qualified in CUR
Projected Net Operating Income (NOI) - 15 Year
3.00%
Projected Net Operating Income (NOI) - Year 1
$145,027
$1,130,000
$1,510,000
$2,660,000
$420,054
$13,570,000
Year 15 Pro Forma Expense Escalation Rate
2.00%
$99,258
$1,510,000
As-Is Land Value
HC Annual Allocation - Equity Letter of Interest
Third Mortgage
Fourth Mortgage
$204,128
Perm Loan/Unit
Permanent
Construction
Lender
Source
BOA
FHFC - SAIL
FHFC - ELI
Steadytown
Housing Credit Equity Enterprise
$240,600
$3,000,000
$131,076
Deferred Developer Fee $3,889Carrfour
$39,156
$0
$14,156,250
$240,600
$3,000,000
$4,228,900
First Mortgage
Second Mortgage
CONSTRUCTION/PERMANENT SOURCES:
$427,464 $420,054
$2,228
$27,778
$10,350,000
$4,228,900
$3,798,840
$22,045,804TOTAL $22,045,804
$0
The SAIL Loan will take first lien position upon conversion to permanent financing, when the
Bank of America, N.A. (“BOA”) construction loan will be paid in full.
Credit Underwriter:
Date of Final CUR:
TDC PU Limitation at Application:
TDC PU Limitation at Credit Underwriting:
Minimum 1st Mortgage per Rule: Amount Dev. Fee Reduced for TDC Limit:
$209,777
$261,812
N/A $0
First Housing
TBD
Based on Rule Chapter 67-48, the minimum qualified first mortgage determination does not apply
to any Development that qualifies as a Homeless or Persons with Special Needs. The permanent
first mortgage will be the SAIL Loan.
Exhibit G
Page 9 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page A-7
October 17, 2019
Changes from the Application:
COMPARISON CRITERIA YES NO
Does the level of experience of the current team equal or exceed that of the
team described in the Application?
X
Are all funding sources the same as shown in the Application? 1.
Are all local government recommendations/contributions still in place at the
level described in the Application?
N/A
Is the Development feasible with all amenities/features listed in the
Application?
X
Do the site plans/architectural drawings account for all amenities/features
listed in the Application?
X
Does the applicant have site control at or above the level indicated in the
Application?
X
Does the applicant have adequate zoning as indicated in the Application? X
Has the Development been evaluated for feasibility using the total length of
set-aside committed to in the Application?
X
Have the Development costs remained equal to or less than those listed in the
Application?
2.
Is the Development feasible using the set-asides committed to in the
Application?
X
If the Development has committed to serve a special target group (e.g. elderly,
large family, etc.), do the development and operating plans contain specific
provisions for implementation?
X
SAIL ONLY: If points were given for match funds, is the match percentage the
same as or greater than that indicated in the Application?
N/A
HC ONLY: Is the rate of syndication the same as or greater than that shown in
the Application?
X
Is the Development in all other material respects the same as presented in the
Application?
3-6
The following are explanations of each item checked "No" in the table above:
1. The Construction First Mortgage changed since the Application from JP Morgan Chase
Bank, N.A. to BOA. Additionally, the Syndicator changed from National Equity Fund, Inc.
to Enterprise.
Exhibit G
Page 10 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page A-8
October 17, 2019
2. The Total Development Cost (“TDC”) has increased a total of $4,166,184 from
$17,879,620 to $22,045,804 or 23.3% since the Application. The increase is mainly due
to an increase in construction costs and Developer Fee, which is explained by an increase
in total number of units by 28 units. Furthermore, the per unit cost went down 8.7%, from
$223,495 to $204,128.
3. The Application indicated a total set-aside percentage of 100%. The total set-aside
percentage is now 74.1% and was approved at the March 22,
2019 Board meeting. Please
see Waiver Requests/Special Conditions for further information.
4. Since the Application, the number of units has increased from 80 to 108 and was approved
at the March 22, 2019 Board Meeting.
5. The increase in number of units resulted on the following change in unit mix:
Unit Mix (from) Unit Mix (to)
40 one bedroom/one bath
34 two bedroom/two bath
6 three bedroom/two bath
Total 80 units
12 ELI Set Aside Units
49 one bedroom/one bath
51 two bedroom/two bath
8 three bedroom/two bath
Total 108 units
17 ELI Set Aside Units
The Applicant must submit a unit mix change request to FHFC Staff. Approval of this
request is a condition to close.
6. The Application indicated the Development category was Garden Apartments; however,
the Development category is now Mid-Rise, containing four stories. Rule Chapter 67-48
states the Development type selected at Application must be maintained and cannot be
changed. The Applicant has requested a rule waiver, which will be presented at the October
FHFC Board meeting; Closing is conditioned upon a Board approval of the Development
category change rule waiver.
7. FHFC Staff approved the Applicant’s request to decrease the number of residential
buildings from 2 to 1 on November 9, 2018.
The above changes have no substantial material impact to the SAIL Loan, ELI Loan, or HC
recommendation for this Development.
Does the Development Team have any FHFC Financed Developments on the Past
Due/Noncompliance Report?
Exhibit G
Page 11 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page A-9
October 17, 2019
According to the FHFC Asset Management Noncompliance Report, dated May 13, 2019, the
Development has the following noncompliance item(s) not in the correction period:
Ø None
According to the FHFC Past Due report, dated August 12, 2019, the Development Team has the
following past due item(s):
Ø None
Closing of the loan is conditioned upon verification that any outstanding past due, and/or
noncompliance items noted at the time closing and the issuance of the annual HC allocation
recommended herein, have been satisfied.
Strengths:
1. The Principals, Developer, and Management Company are experienced in affordable
multifamily housing.
2. The Principals have sufficient experience and substantial financial resources to develop
and operate the proposed Development.
3. Meridian prepared a Market Study for the Development, dated August 6, 2019 (Report
Date). The weighted average occupancy rate for existing properties in the Competitive
Market Area (“CMA”) is 98.7%. Meridian projects an average absorption rate of 25 units
per month based on the market rate and affordable absorption comparables.
Other Considerations:
None
Mitigating Factors:
None
Waiver Requests/Special Conditions:
Ø The Applicant submitted a Petition for Waiver of Rule 67-48.004(3)(j) for a Change in
Total Set-Aside Percentage and Variance from Provisions of RFA 2018-103, dated March
Exhibit G
Page 12 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page A-10
October 17, 2019
4, 2019, which requested the following and was approved at the March 22, 2019 Board
meeting:
· Increase the number of units in the Development from 80 to 108, the additional 28
units to be available at market rate.
· Decrease the Total Set-Aside Percentage from 100% to 74.1%.
· Waive Section Four A.2.a.(1) of the RFA and decrease the percentage of units set
aside for Homeless persons from 70% to approximately 51.85% and decrease the
percentage of unit set aside for Persons with Special Needs from 20% to
approximately 14.81%.
· Waive Section Four A.6.d.(2)(a) of the RFA, which requires the Applicant to set
aside a total of at least 80% of the Development’s total units at 60% AMI or less.
· This waiver will not decrease the total number of units set aside for low-income
tenants, for Homeless individuals or families, or for Persons with Special Needs
from the Applicant’s original commitment in the RFA.
Ø The Application indicated the Development category was Garden Apartments; however,
the Development category is now Mid-Rise, containing four stories. Rule Chapter 67-48
states the Development type selected at Application must be maintained and cannot be
changed. The Applicant has requested a rule waiver, which will be presented at the October
FHFC Board meeting; Closing is conditioned upon Board approval of this rule waiver.
Additional Information:
1. First Housing reviewed the requirements in RFA 2018-103 regarding TDC limitation per
unit. First Housing used a hybrid TDC limitation calculation, as provided by FHFC staff,
based on an email dated September 18, 2019, which allows the Developer to increase the
TDC limitation for the new Development type of mid-rise wood. However, the hybrid TDC
limits the Developer Fee at the maximum TDC limitation for the original Development
type indicated in the Application. The hybrid TDC limitation for the Development is
$261,812 per unit, after the multiplier and upward adjuster, which includes a 16%
Developer fee capped at $29,443 for garden wood developments. The Development TDC
excluding land costs and lender reserves is $193,943 per unit, which includes Developer
Fee of $25,645 per unit. The Development TDC meets the TDC limitation requirement
established by FHFC staff.
2. Per the RFA, a Resident Community-Based Service Coordination Plan is required to be
submitted and reviewed prior to the final credit underwriting report. The plan has been
submitted to Florida Housing and approved on September 11, 2019.
Exhibit G
Page 13 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page A-11
October 17, 2019
3. Per the RFA, a Tenant Selection Plan is required to be submitted and reviewed prior to the
final credit underwriting report. The plan has been submitted and approved by Florida
Housing.
Issues and Concerns:
None
Recommendation:
First Housing recommends a SAIL Loan in the amount of $4,228,900, an ELI Loan in the amount
of $240,600 and an annual HC Allocation of $1,510,000 to finance the construction and permanent
financing of the Development.
These recommendations are based upon the assumptions detailed in the Report Summary (Section
A) and Supporting Information and Schedules (Section C). In addition, these recommendations
are subject to the SAIL and ELI Loan Special and General Conditions and the HC Allocation
Recommendation and Contingencies (Section B). This recommendation is only valid for six
months from the date of the report.
The reader is cautioned to refer to these sections for complete information.
Prepared by: Reviewed by:
Thais Pepe Ed Busansky
Senior Credit Underwriter Senior Vice President
Exhibit G
Page 14 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page A-12
October 17, 2019
Overview
Construction Financing Sources:
Construction Sources Lender Application Revised Applicant Underwriter
Construction
Interest Rate
Annual
Construction Debt
Service
First Mortgage BOA $9,500,000 $10,500,000 $10,350,000 4.29% $444,015
Second Mortgage FHFC - SAIL $4,228,900 $4,228,900 $4,228,900 0.48% $20,299
Third Mortgage FHFC - ELI $240,600 $240,600 $240,600 0.00% $0
Fourth Mortgage Steadytown $0 $3,000,000 $3,000,000 0.00% $0
Housing Credit Equity Enterprise $2,657,334 $3,807,870 $3,798,840 N/A N/A
Deferred Developer Fee Carrfour $2,218,000 $3,586,983 $427,464 N/A N/A
Total $18,844,834 $25,364,353 $22,045,804 $464,314
First Mortgage:
First Housing reviewed an executed Term Sheet, dated August 13, 2019, provided by BOA. The
Term Sheet indicates BOA will provide a construction loan in the amount not to exceed
$10,500,000, 80% loan to cost, or 80% loan to value, subject to BOA underwriting. The term of
the loan will be twenty-four (24) months, plus one 6-month extension option. Payments of interest
only will be required until maturity. The loan will bear interest at a rate of one Month London
Interbank Offered Rate (“LIBOR”) plus 210 basis points (“bps”). The construction interest is
calculated based upon the current 1 Month LIBOR rate of 1.94% (as of September 9, 2019), plus
a 2.10% spread, and a 0.25% underwriting cushion, for an “all-in” interest rate of 4.29%. First
Housing estimated the construction loan in the amount of $10,350,000, based on the Deferred
Developer Fee estimated during the permanent financing phase.
FHFC SAIL Loan:
First Housing reviewed an invitation to enter credit underwriting, dated June 27, 2018, from FHFC
with a preliminary SAIL Loan in the amount of $4,228,900. According to the RFA, the SAIL Loan
shall be non-amortizing and will bear a blended overall simple interest rate of 0.48% determined
by the weighted average of 52% of the Homeless Households at 0% interest and the remaining
48% of the units at 1.00% simple interest per annum. The SAIL Loan term is 15 years, of which 2
years is for the construction/stabilization period. Annual payments of all applicable fees will be
required. To the extent that development cash flow is available, annual interest payments at the
0.48% rate will be required; any unpaid interest will be deferred until cash flow is available.
However, at the maturity of the SAIL Loan, all principal and unpaid interest will be due.
Exhibit G
Page 15 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page A-13
October 17, 2019
FHFC ELI Loan:
First Housing reviewed an invitation to enter credit underwriting, dated June 27, 2018, from FHFC
with a preliminary ELI Loan in the amount of $240,600. According to the RFA, the ELI Loan shall
be non-amortizing and shall have an interest rate of zero percent (0%), with principal forgivable
at maturity provided the units for which the ELI Loan amount is awarded are targeted to ELI
Households for the first 15 years of the 50-year Compliance Period. The ELI Loan term is 15 years,
of which 2 years is for the construction/stabilization period. However, after 15 years, all of the ELI
Set-Aside units associated with the ELI Loan Funding (4 units) may convert to serve residents at
or below 60% of AMI. The ELI set-aside units that were not associated with the ELI Loan Funding
will remain ELI set-aside units for the entire Compliance Period. Annual payments of all
applicable fees will be required.
Steadytown Loan:
First Housing reviewed a Loan Commitment from Steadytown, Inc. and/or its affiliates
(“Steadytown”), dated February 8, 2019, for a loan in the amount of $3,000,000. The loan will be
non-interest bearing, and will amortize based on 80% of available cash flow, after payment of all
senior loans. The loan is non-recourse and non-amortizing with a 30-year term, including 2 years
for construction. Should the loan not be paid off at maturity, the term of the loan could be extended
an additional 20 year to be coterminous with the 50 year affordability period, at which time
repayment of any outstanding balance will be due.
Housing Credit Equity:
First Housing has reviewed an executed Letter of Interest (“LOI”), dated August 12, 2019,
indicating Enterprise, or its assignee, will acquire 99.99% ownership interest in the Partnership.
Based on the LOI, the annual HC allocation is estimated to be in the amount of $1,510,000 and a
syndication rate of $0.9375 per dollar. Enterprise anticipates a net capital contribution of
$14,156,250 paid in six installments, and has committed to make available 25.0% or $3,539,060
of the total net equity at closing. An additional $259,780 or 1.8% will be available during
construction, for a total of $3,798,840 available
during construction. The first installment meets
the FHFC requirement that 15% of the total equity must be contributed at or prior to the closing.
Deferred Developer Fee:
To balance the sources and uses of funds during construction, the Developer is required to defer
$427,464 or approximately 15.4% of the Developer Fee of $2,769,693, which excludes the portion
being used to fund the Operating Deficit Reserve (“ODR”).
Exhibit G
Page 16 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page A-14
October 17, 2019
Permanent Financing Sources:
Permanent Sources Lender Application Revised Applicant Underwriter Term Yrs. Amort. Yrs.
Interest
Rate
Annual Debt
Service
First Mortgage FHFC - SAIL $4,228,900 $4,228,900 $4,228,900 15 0 0.48% $20,299
Second Mortgage FHFC - ELI $240,600 $240,600 $240,600 15 0 0.00% $0
Third Mortgage Steadytown, Inc. $0 $3,000,000 $3,000,000 30 30 0.00% $100,000
Housing Credit Equity Enterprise $13,286,671 $14,156,250 $14,156,250 N/A N/A N/A N/A
Deferred Developer Fee Carrfour $2,218,000 $3,586,983 $420,054 N/A N/A N/A N/A
Total $19,974,171 $25,212,733 $22,045,804 $120,299
FHFC SAIL Loan:
First Housing reviewed an invitation to enter credit underwriting, dated June 27, 2018, from FHFC
with a preliminary SAIL Loan in the amount of $4,228,900. According to the RFA, the SAIL Loan
shall be non-amortizing and will bear a blended overall simple interest rate of 0.48% determined
by the weighted average of 52% of the Homeless Households at 0% interest and the remaining
48% of the units at 1.00% simple interest per annum. The SAIL Loan term is 15 years, of which 2
years is for the construction/stabilization period. Annual payments of all applicable fees will be
required. To the extent that development cash flow is available, annual interest payments at the
0.48% rate will be required; any unpaid interest will be deferred until cash flow is available.
However, at the maturity of the SAIL Loan, all principal and unpaid interest will be due.
The annual multiple program Compliance Monitoring Fee for the SAIL Loan is $938. The annual
Permanent Loan Servicing Fee is based on 25 bps of the outstanding loan amount, with a minimum
monthly fee of $216, and a maximum monthly fee of $859.
FHFC ELI Loan:
First Housing reviewed an invitation to enter credit underwriting, dated June 27, 2018, from FHFC
with a preliminary ELI Loan in the amount of $240,600. According to the RFA, the ELI Loan shall
be non-amortizing and shall have an interest rate of zero percent (0%), with principal forgivable
at maturity provided the units for which the ELI Loan amount is awarded are targeted to ELI
Households for the first 15 years of the 50-year Compliance Period. The ELI Loan term is 15 years,
of which 2 years is for the construction/stabilization period. However, after 15 years, all of the ELI
Set-Aside units associated with the ELI Loan Funding (4 units) may convert to serve residents at
or below 60% of AMI. The ELI set-aside units that were not associated with the ELI Loan Funding
will remain ELI set-aside units for the entire Compliance Period. Annual payments of all
applicable fees will be required.
Exhibit G
Page 17 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page A-15
October 17, 2019
The annual multiple program Compliance Monitoring Fee for the ELI Loan is $938. The annual
Permanent Loan Servicing Fee is based on 25 bps of the outstanding loan amount, with a minimum
monthly fee of $216, and a maximum monthly fee of $859.
Steadytown Loan:
First Housing reviewed a Loan Commitment from Steadytown, dated February 8, 2019, for a loan
in the amount of $3,000,000. The loan will be non-interest bearing, and will amortize based on
80% of available cash flow, after payment of all senior loans. The loan is non-recourse and non-
amortizing with a 30-year term, including 2 years for construction. Should the loan not be paid off
at maturity, the term of the loan could be extended an additional 20 year to be coterminous with
the 50 year affordability period, at which time repayment of any outstanding balance will be due.
For presentation purposes, First Housing used a 30-year amortization schedule.
Housing Credit Equity:
Based on an executed LOI, dated August 12, 2019, Enterprise, or its assignee, will acquire 99.99%
ownership interest in the Partnership. Based on the LOI, the annual HC allocation is estimated to
be in the amount of $1,510,000 and a syndication rate of $0.9375 per dollar. Enterprise anticipates
a net capital contribution of $14,156,250 paid in six installments as follows:
Capital Contributions Amount Percentage of Total When Due
1st Installment $3,539,060 25.00%
Financial Closing
2nd Installment $259,780 1.84%
During Construction
3rd Installment $5,662,500 40.00%
Construction Completion
4th Installment $849,000 6.00%
FHFC Reserve Funding
5th Installment $3,586,130 25.33%
Stabilization/Conversion
6th Installment $259,780 1.84%
Receipt of Form(s) 8609
Total $14,156,250 100.00%
Annual Credit Per Syndication Agreement
$1,510,000
Calculated HC Exchange Rate
$0.9375
Limited Partner Ownership Percentage
99.99%
Proceeds Available During Construction
$3,798,840
Exhibit G
Page 18 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page A-16
October 17, 2019
Deferred Developer Fee:
To balance the sources and uses of funds during the permanent funding period, the Developer is
required to defer $420,054 or approximately 15.2% of the Developer Fee of $2,769,693(which
excludes the portion being used to fund the ODR).
Exhibit G
Page 19 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page A-17
October 17, 2019
Uses of Funds
CONSTRUCTION COSTS:
Applicant Costs
Revised
Applicant Costs
Underwriters
Total Costs - CUR
Cost Per Unit
HC Ineligible
Costs - CUR
Accessory Buildings
$200,000 $0 $0 $0 $0
New Rental Units
$7,970,000 $9,548,396 $10,773,850 $99,758 $750,000
Off-Site Work
$0 $750,000 $0 $0 $0
Recreational Amenities
$364,000 $0 $0 $0 $0
Site Work
$250,000 $843,265 $0 $0 $0
Constr. Contr. Costs subject to GC Fee
$8,784,000 $11,141,661 $10,773,850 $99,758 $750,000
General Conditions
$0 $0 $646,431 $5,985 $0
Overhead
$0 $0 $215,477 $1,995 $0
Profit
$1,200,000 $1,508,339 $646,431 $5,985 $0
General Liability Insurance
$0 $0 $39,082 $362 $0
Payment and Performance Bonds
$0 $0 $101,438 $939 $0
Contract Costs not subject to GC Fee
$0 $0 $227,292 $2,105 $0
Total Construction Contract/Costs
$9,984,000 $12,650,000 $12,650,000 $117,130 $750,000
Hard Cost Contingency
$485,000 $732,500 $625,474 $5,791 $0
Other: Recreational Amenities
$0 $453,400 $453,400 $4,198 $453,400
$10,469,000 $13,835,900 $13,728,874 $127,119 $1,203,400
Total Construction Costs:
Notes to the Total Construction Costs:
1. The Applicant has provided an executed construction contract, dated July 23, 2019, in the
amount of $12,650,000. This is a Standard Form of Agreement between Owner, Rosemary
Village Apartments, LLLP and General Contractor (“GC”), Royal American Construction
Company, Inc. where the basis of payment is the Cost of the Work Plus a Fee with a
Guaranteed Maximum Price (“GMP”). Per the contract, substantial completion is to be
achieved by no later than 365 days from the date of commencement. The construction
contract specifies a 10% retainage until 50% of construction completion, and no retainage
thereafter.
2. First Housing utilized the Schedule of Values to complete the construction costs.
3. The GC Contract includes $131,579 in allowance, of which $10,000 is for building sign,
$82,000 is for perimeter fencing, and $39,579 is for demucking. Allowances total
approximately 1% of the GMP.
4. The GC fee is within the maximum 14% of hard costs allowed by Rule Chapter 67-48,
excluding General Liability Insurance and Payment and Performance Bonds (“P&P
Exhibit G
Page 20 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page A-18
October 17, 2019
Bonds”). The GC fee stated herein is for credit underwriting purposes only, and the final
GC fee will be determined pursuant to the final cost certification process as per Rule
Chapter 67-48.
5. Contract Costs not subject to GC Fee include $183,000 for appliances, $39,292 for window
treatments, and $5,000 for building permits.
6. First Housing adjusted Hard Cost Contingency to 5% of the total construction contract
(excluding General Liability Insurance and P&P Bonds), which is within the allowable 5%
of total hard costs for new construction developments as required by Rule Chapter 67-48.
7. The General Contractor has budgeted for P&P Bonds to secure the construction contract.
GENERAL DEVELOPMENT COSTS:
Applicant Costs
Revised
Applicant Costs
Underwriters
Total Costs - CUR
Cost Per Unit
HC Ineligible
Costs - CUR
Accounting Fees
$50,000 $40,000 $40,000 $370 $20,000
Appraisal
$10,000 $10,000 $4,500 $42 $0
Architect's Fee - Site/Building Design
$322,000 $428,050 $428,050 $3,963 $0
Architect's Fee - Supervision
$30,000 $40,000 $40,000 $370 $0
Building Permits
$44,800 $60,480 $60,480 $560 $0
Builder's Risk Insurance
$60,000 $60,000 $60,000 $556 $0
Engineering Fees
$65,000 $65,000 $65,000 $602 $0
Environmental Report
$15,000 $95,000 $95,000 $880 $0
FHFC Administrative Fees
$83,050 $83,050 $83,050 $769 $83,050
FHFC Application Fee
$3,000 $3,000 $3,000 $28 $3,000
FHFC Credit Underwriting Fee
$21,659 $21,659 $20,031 $185 $20,031
FHFC Compliance Fee
$200,000 $200,000 $211,801 $1,961 $211,801
Impact Fee
$364,146 $491,598 $491,598 $4,552 $0
Lender Inspection Fees / Const Admin
$59,075 $59,075 $59,075 $547 $19,075
Green Building Cert. (LEED, FGBC, NAHB)
$60,000 $50,000 $50,000 $463 $0
Insurance
$75,000 $75,000 $75,000 $694 $0
Legal Fees - Organi zational Costs
$215,000 $225,000 $225,000 $2,083 $65,000
Market Study
$5,000 $5,000 $5,500 $51 $5,500
Marketing and Advertisi ng
$180,000 $180,000 $180,000 $1,667 $180,000
Plan and Cost
Review Analysis
$0 $0 $2,050 $19 $0
Property Taxes
$50,000 $50,000 $50,000 $463 $20,000
Soil Test
$15,000 $15,000 $15,000 $139 $0
Survey
$25,000 $25,000 $25,000 $231 $0
Title Insurance and Recording Fees
$150,080 $137,075 $137,075 $1,269 $137,075
Utility Connection Fees
$544,400 $308,377 $308,377 $2,855 $0
Soft Cost Contingency
$100,000 $0 $137,479 $1,273 $0
Other: Photos, Printing, Website
$25,000 $15,000 $15,000 $139 $5,000
$2,772,210 $2,742,364 $2,887,066 $26,732 $769,532
Total General Development Costs:
Exhibit G
Page 21 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page A-19
October 17, 2019
Notes to the General Development Costs:
1. General Development Costs are the Applicant's updated estimates, which appear
reasonable.
2. First Housing has utilized actual costs for: FHFC Credit Underwriting, Market Study,
Appraisal, and Plan and Cost Analysis (“PCA”).
3. Per the RFA, the FHFC Administrative Fee is based on 5.5% of the recommended annual
Housing Credit allocation.
4. FHFC Compliance Fee of $211,801 is based on the compliance fee calculator spreadsheet
provided by FHFC.
5. First Housing adjusted the Soft Cost Contingency to be 5% of the General Development
Costs less the soft cost contingency, as allowed by RFA 2018-103 and Rule Chapter 67-48
for new construction developments.
Applicant Costs
Revised
Applicant Costs
Underwriters
Total Costs - CUR
Cost Per Unit
HC Ineligible
Costs - CUR
Construction Loan Commitment Fee
$140,000 $139,500 $93,150 $863
Construction Loan Closing Costs
$10,000 $10,000 $10,000 $93 $0
Construction Loan Interest
$457,000 $396,000 $497,297 $4,605 $115,000
Permanent Loan Closing Costs
$20,000 $20,000 $20,000 $185 $20,000
SAIL Commitment Fee
$0 $0 $42,289 $392 $0
SAIL Closing Costs
$0 $0 $12,750 $118 $0
SAIL-ELI Commitment Fee
$0 $0 $2,406 $22 $0
SAIL-ELI Closing Costs
$0 $0 $6,750 $63 $0
Other: Pre-Development Loan Interest
$0 $10,000 $10,000 $93 $0
$627,000 $575,500 $694,642 $6,432 $135,000
$13,868,210 $17,153,764 $17,310,582 $160,283 $2,107,932
Dev. Costs before Acq., Dev. Fee & Reserves
FINANCIAL COSTS:
Total Financial Costs:
Notes to the Financial Costs:
1. The Construction Loan Commitment Fee of $93,150 is based on a commitment fee of
0.90% on the construction loan amount of $10,350,000.
2. The Construction Loan Interest of $497,297 was estimated by First Housing based on an
estimated interest rate of 4.29% for a construction term of 24 months, and an average
outstanding balance of 56%.
Exhibit G
Page 22 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page A-20
October 17, 2019
3. SAIL Commitment Fee is based on 1% of the SAIL Loan.
4. First Housing has included $12,750 for SAIL and $6,750 for SAIL ELI Closing Costs.
5. SAIL ELI Commitment Fee is based on 1% of the ELI Loan.
6. Enterprise entered into a predevelopment Loan Agreement with the Applicant, on
September 5, 2019, for $1,000,000 to be used to fund the acquisition and predevelopment
costs. Interest shall accrue at a rate of 5% per annum, however no interest shall accrue for
the first six months following the date of this Agreement.
Applicant Costs
Revised
Applicant Costs
Underwriters
Total Costs - CUR
Cost Per Unit
HC Ineligible
Costs - CUR
Building Acquisition Cost
$0 $0 $0 $0 $0
$0 $0 $0 $0 $0
NON-LAND ACQUISITION COSTS
Total Non-Land Acquisition Costs:
Notes to the Non-Land Acquisition Costs:
1. As this is new construction, there are no non-land acquisition costs.
Applicant Costs
Revised
Applicant Costs
Underwriters
Total Costs - CUR Cost Per Unit
HC Ineligible
Costs - CUR
Developer Fee - Unapportioned
$2,218,000 $3,597,273 $2,769,693 $25,645 $0
DF to fund Operating Debt Reserve
$693,410 $0 $865,529 $8,014 $0
$2,911,410 $3,597,273 $3,635,222 $33,659 $0
DEVELOPER FEE ON NON-ACQUISTION COSTS
Total Other Development Costs:
Notes to Developer Fee on Non-Acquisition Costs:
1. The recommended Developer Fee does not exceed 21% of TDC before Developer Fee,
ODR, land costs, and escrows as allowed by RFA 2018-103. A portion of the Developer
Fee (5% of development costs before Developer Fee and reserves and is estimated to be
$865,529 ) must be placed in an ODR account to be held by FHFC or its Servicer. Any
disbursements from said ODR account shall be reviewed and approved by FHFC or its
Servicer. At the end of the Compliance Period, any remaining balance of the ODR less
amounts that may be permitted to be drawn (which includes Deferred Developer Fee and
reimbursements for authorized member/partner and guarantor loan(s)), will be used to pay
FHFC loan debt; if there is no FHFC loan debt on the Development at the end of the
Compliance Period, any remaining balance shall be used to pay outstanding FHFC fees. If
any balance is remaining in the ODR after the payments above, the amount should be
placed in a Replacement Reserve account for the Development. In no event shall the
payments of amounts to the Applicant or the Developer from the ODR account cause the
Exhibit G
Page 23 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page A-21
October 17, 2019
Developer Fee or General Contractor Fee to exceed the applicable percentage limitations
provided for in Rule Chapter 67-48.
Applicant Costs
Revised
Applicant Costs
Underwriters
Total Costs - CUR
Cost Per Unit
HC Ineligible
Costs - CUR
Land Acquisition Cost
$1,100,000 $1,100,000 $1,100,000 $10,185 $1,100,000
$1,100,000 $1,100,000 $1,100,000 $10,185 $1,100,000
LAND ACQUISITION COSTS
Total Acquisition Costs:
Notes to Acquisition Costs:
1. First Housing has reviewed a Vacant Land Contract, executed on April 18, 2018, between
Keith P. Donald (“Seller”) and Rosemary Village Apartments, LLLP (“Buyer”). First
Housing also reviewed an Addendum to the Vacant Land Contract, in which the purchase
price of the property is the lesser of $1,100,000 or the Appraised Property Value, but no
less than $600,000 (minimum purchase price). Based on this contract, the closing must
occur on or before September 30, 2019. Additionally, First Housing reviewed a
Amendment to Vacant Land Contract, dated September 30, 2019, between the Seller and
the Buyer, extending the closing date to November 30, 2019.
2. Based on the appraiser’s analysis, the land value is $1,130,000, which supports the
purchase price.
Applicant Costs
Revised
Applicant Costs
Underwriters
Total Costs - CUR
Cost Per Unit
HC Ineligible
Costs - CUR
Reserves - Start-Up/Lease-up Expenses
$0 $0 $0 $0 $0
$0 $0 $0 $0 $0
RESERVE ACCOUNTS
Total Reserve Accounts:
Notes to Reserve Accounts
1. No additional reserves are required for the Development.
Applicant Costs
Revised
Applicant Costs
Underwriters
Total Costs - CUR
Cost Per Unit
HC Ineligible
Costs - CUR
$17,879,620 $21,851,037 $22,045,804 $204,128 $3,207,932
TOTAL DEVELOPMENT COSTS:
TOTAL DEVELOPMENT COSTS
Notes to Total Development Costs:
1. The Total Development Costs have increased a total of $4,166,184 from $17,879,620 to
$22,045,804 or 23.3% since the Application. The increase is mainly due to an increase in
construction costs and Developer Fee, which is explained by an increase in total number
of units by 28 units. Furthermore, the per unit cost went down 8.7%, from $223,495 to
$204,128.
Exhibit G
Page 24 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page A-22
October 17, 2019
Operating Pro Forma – Heritage Park at Crane Creek
FINANCIAL COSTS: Year 1
Year 1
Per Unit
OPERATING PRO FORMA
Gross Potential Rental Income $766,272 $7,095
Other Income
Mi scell a neous $13,000 $120
Gross Potential Income $779,272 $7,215
Les s:
Physica l Va c. Loss Percenta ge: 6.00% $46,756 $433
Col lection Loss Percenta ge: 1.00% $7,793 $72
Total Effective Gross Income $724,723 $6,710
Fi xed:
Real Es tate Taxes $55,073 $510
Ins urance $54,000 $500
Va ria ble:
Mana gement Fee Percentage: 6.00% $43,483.38 $403
General and Adminis tra ti ve $48,600 $450
Payroll Expenses $156,600 $1,450
Uti li ti es $89,100 $825
Marketi ng and Advertising $3,240 $30
Maintenance and Repairs /Pes t Control $59,400 $550
Grounds Maintenance and La nds capi ng $10,800 $100
Security $27,000 $250
Res erve for Re place ments $32,400 $300
Total Expenses $579,696 $5,368
Net Operating Income $145,027 $1,343
Debt Service Payments
Fi rst Mortga ge - SAIL $20,299 $188
Second Mortga ge - ELI $0 $0
Third Mortga ge - Steadytown $100,000 $926
$11,246 $104
$3,530 $33
Tota l Debt Service Pa yments $135,075 $1,251
Cas h Fl ow after Debt Service $9,952 $92
FINANCIAL COSTS:
Annual
Per Unit
Debt Service Coverage Ratios
DSC - First Mortgage plus Fe es 4.60x
DSC - Second Mortga ge plus Fe es 4.13x
DSC - Third Mortgage plus Fees 1.07x
Financial Ratios
Operating Expens e Rati o 79.99%
Break-even Economi c Occupa ncy Rati o (all de bt) 92.14%
INCOME:
EXPENSES:
Fi rst Mortga ge Fees - SAIL
Second Mortga ge Fees - ELI
Notes to the Operating Pro Forma and Ratios:
1. The Development will be utilizing Housing Credits in conjunction with SAIL and ELI
financing, which will impose rent restrictions. The rent levels are based on the 2018
maximum low income housing tax credits (“LIHTC”) rents published on FHFC’s website
for Brevard County less the applicable utility allowance. Please note First Housing
Exhibit G
Page 25 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page A-23
October 17, 2019
utilized the appraiser’s estimated achievable rents. The homeless rents were based on
45% housing burden of the estimated average income, less utility allowance. Below is
the rent roll for the Development:
Palm Bay-Melbourne-Titusville MSA, Brevard County, FL
657$
800$
406$
406$
787$
422$
787$
787$
Net
Restricted
Rents
353$
657$
657$
60%
60%
800$
406$
406$
787$
Annual Rental
Income
31,968$
$89
78,840$
86,599108
60%
1,0792.0 2
2 2.0
2 2.0
2
3 2.0
Market3
3 2.0
3 2.0
Market
1,079
2.0
1
3
2
60%1,079
1,079
$876
$876
897$ $1,011
Bed
Rooms
1.0
2.0
Bath
Rooms
1.0
PBRA
Contr
Rents
1
1
1
1
1.0
1.0
10
13
2 8
114$
114$
18
$589
$1,011
$729
12
13
114$
1,100$
897$
471$
471$
475$
897$
618
935
935
935
935
$89
AMI%
35%
35%
Utility
Allow.
$72
Gross HC
Rent
$425
$729
618
618
Applicant
Rents
333$
333$
$72
$7218
$89
Units
Low
HOME
Rents
60%
60%
8
High
HOME
Rents
Square
Feet
Market
35% $511
618
950$
787$
406$
406$
71,928$
Appraiser
Rents
333$
333$
657$
800$
38,976$
87,696$
113,328$
148,200$
124,800$
950$
CU Rents
333$
333$
657$
5,652$
16,956$
950$
21,528$
26,400$
766,272$
471$
471$
897$
1,100$ 1,100$
471$
471$
897$
2. The Vacancy rate of 6% and Collection loss rate of 1% is based on appraisal’s estimate,
which considers the demographic commitment.
3. Miscellaneous Income is comprised of revenue from vending income, late charges, pet
deposits, forfeited security deposits and other miscellaneous sources. Total
Miscellaneous Income of approximately $120 per unit per year is supported by the
appraisal.
4. Based upon operating data from comparable properties, third-party reports (appraisal and
market study) and First Housing's independent due diligence, First Housing represents
that, in its professional opinion, estimates for Rental Income, Vacancy, Other Income,
and Operating Expenses fall within a band of reasonableness.
5. The Applicant has submitted a Management Agreement, dated August 28, 2019, which
reflects a management fee equal to 6% of the Effective Gross Potential Gross Revenue,
or $33.80 per unit per month, whichever is higher, which was supported by the appraisal.
6. The landlord is responsible for common area electric, water and sewer, trash collection
and cable for the clubhouse. Tenant will be responsible for electric, cable and internet.
Exhibit G
Page 26 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page A-24
October 17, 2019
7. Replacement Reserves of $300/unit/year are required per Rule Chapter 67-48.
8. Per Rule Chapter 67-48.0072(11), the maximum debt service coverage (“DSC”) shall be
1.50 to 1.00 for the SAIL Loan, including all superior mortgages. The DSC is 4.60 to
1.00, which exceeds the maximum threshold. In extenuating circumstances, such as when
the Development has deep or short-term subsidy, the DSC may exceed 1.50x, if the
Credit Underwriter’s favorable recommendation is supported by the projected cash flow
analysis as illustrated in Exhibit 1. In this instance, the above extenuating circumstances
apply, based on the deep subsidy of 17 units at or below 35% of the AMI, exceeding the
maximum threshold as permitted.
9. Refer to Exhibit I, Page 1 for a 15-Year Pro Forma, which reflects rental income
increasing at an annual rate of 2%, and expenses increasing at an annual rate of 3%.
Exhibit G
Page 27 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
October 17, 2019
Section B
SAIL and ELI Loan Special and General Conditions
HC Allocation Recommendation and Contingencies
Exhibit G
Page 28 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page B-1
October 17, 2019
Special Conditions
This recommendation is contingent upon the review and approval of the following items by Florida
Housing and First Housing at least two weeks prior to Loan Closing. Failure to submit and to
receive approval of these items within this time frame may result in postponement of the SAIL
and ELI Loan closing date.
1. Satisfactory receipt and review of updated financials for the Guarantors, dated within 90
days of closing or Audited Financial Statements within one year.
2. Receipt of firm commitments from BOA, Steadytown, and Enterprise are conditions to
close.
3. Confirmation that the $1,000,000 Predevelopment loan from Enterprise is paid off by
closing.
4. Receipt and satisfactory review of the Final signed, sealed “approved for construction”
plans and specifications by the Construction Consultant and the Servicer.
5. Approval by FHFC Board of the rule waiver to allow the Development category to change
from Garden Apartments to Mid-Rise with four stories.
6. The Applicant must submit a unit mix change request to FHFC Staff. Approval of this
request is a condition to close.
7. Any other reasonable requirements of the Servicer, Florida Housing, or its legal counsel.
Exhibit G
Page 29 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page B-2
October 17, 2019
General Conditions
This recommendation is contingent upon the review and approval of the following items by Florida
Housing and First Housing at least two weeks prior to Loan Closing. Failure to submit and to
receive approval of these items within this time frame may result in postponement of the SAIL
and ELI Loan closing date.
1. Payment of any outstanding arrearages to FHFC, its legal counsel, Servicer or any agent
or assignee of FHFC for past due issues applicable to the Development team (Applicant
or Developer or Principal, Affiliate or Financial Beneficiary, as described in 67-48.0075
(5) F.A.C. of an Applicant or a Developer).
2. GLE is to act as construction inspector during the construction phase.
3. At all times there will be undisbursed loan funds (collectively held by Florida Housing, the
first mortgage lender and any other source) sufficient to complete the Development. If at
any time there are not sufficient funds to complete the Development, the Applicant will be
required to expend additional equity on Development Costs or to deposit additional equity
with Florida Housing which is sufficient (in Florida Housing’s judgment) to complete the
Development before additional loan funds are disbursed. This condition specifically
includes escrowing at closing all equity necessary to complete construction or another
alternative acceptable to Florida Housing in its sole discretion.
4. During construction, the Developer is only allowed to draw a maximum of 50% of the total
Developer Fee but in no case more than the payable Developer Fee during construction,
which is determined to be "developer's overhead". No more than 35% of "developer's
overhead" will be funded at closing. The remainder of the "developer's overhead" will be
disbursed during construction on a pro rata basis, based on the percentage of completion
of the Development, as approved and reviewed by FHFC and the Servicer. The remaining
unpaid Developer Fee (if applicable) shall be considered attributable to "developer's
profit", and may not be funded until the Development has achieved 100% lien free
completion, and only after retainage has been released.
5. Signed and sealed survey, dated within 90 days of loan closing, unless otherwise approved
by Florida Housing, and its legal counsel, based upon the particular circumstances of the
transaction. The Survey shall be certified to Florida Housing, and its legal counsel, as well
as the title insurance company, and shall indicate the legal description, exact boundaries of
the Development, easements, utilities, roads, and means of access to public streets, total
acreage and flood hazard area and any other requirements of Florida Housing.
Exhibit G
Page 30 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page B-3
October 17, 2019
6. Building permits and any other necessary approvals and permits (e.g., final site plan
approval, Department of Environmental Protection, Army Corps of Engineers, the Water
Management District, Department of Transportation, etc.) or a letter from the local
permitting and approval authority stating that the above referenced permits and approvals
will be issued upon receipt of applicable fees (with no other conditions), or evidence of
100% lien-free completion, if applicable. If a letter is provided, copies of all permits will
be required as a condition of the first post-closing draw.
7. Final "as permitted" (signed and sealed) site plans, building plans and specifications. The
geotechnical report must be bound within the final plans and specifications, if applicable.
8. Final sources and uses of funds schedule itemized by source and line item, in a format and
in amounts approved by the Servicer. A detailed calculation of the construction loan
interest based upon the final draw schedule, documentation of the closing costs, and draft
loan closing statement must also be provided. The sources and uses of funds schedule will
be attached to the Loan Agreement as the approved Development budget.
9. A final construction draw schedule showing itemized sources and uses of funds for each
monthly draw. SAIL Program loan proceeds shall be disbursed during the construction
phase in an amount per draw that does not exceed the ratio of the SAIL Loan to the Total
Development Costs, unless approved by First Housing. ELI Loan proceeds shall be
disbursed during the construction phase in an amount per draw which does not exceed the
ratio of the ELI Loan to the TDC, unless approved by First Housing. The closing draw
must include appropriate backup and ACH wiring instructions.
10. Evidence of insurance coverage pursuant to the RFA governing this proposed transaction
and, as applicable, the FHFC Insurance Guide.
11. A 100% Payment and Performance Bond or a Letter of Credit (“LOC”) in an amount not
less than 25% of the construction contract is required in order to secure the construction
contract between the GC and the Applicant. In either case, Florida Housing must be listed
as co-obligee. The P&P Bonds must be from a company rated at least "A-" by A.M. Best
& Co with a financial size category of at least FSC VI. FHFC, and/or legal counsel must
approve the source, amount(s) and all terms of the P&P Bonds, or LOC. If the LOC option
is utilized, the LOC must include "evergreen" language and be in a form satisfactory to
Florida Housing, its legal counsel and its Servicer.
12. Architect, Construction Consultant, and Developer Certifications on forms provided by
FHFC will be required for both design and as built with respect to Section 504 of the
Exhibit G
Page 31 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page B-4
October 17, 2019
Rehabilitation Act, Americans with Disabilities Act, and the Federal Fair Housing Act
requirements, if applicable.
13. Applicant is to comply with any and all recommendations noted in the Plan and Cost
Review prepared by GLE.
14. At the end of the Compliance Period, any remaining balance of the ODR less amounts that
may be permitted to be drawn (which includes Deferred Developer Fee and
reimbursements for authorized member/partner and guarantor loan(s) pursuant to the
operating/partnership agreement), will be used to pay FHFC loan debt; if there is no FHFC
loan debt on the proposed Development at the end of the Compliance Period, any remaining
balance shall be used to pay any outstanding FHFC fees. If any balance is remaining in the
ODR after the payments above, the amount should be placed in a Replacement Reserve
account for the Development. In no event shall the payments of amounts to the Applicant
or the Developer from the Reserve Account cause the Developer Fee or General Contractor
Fee to exceed the applicable percentage limitations provided for in Rule Chapter 67-48.
Any and all terms and conditions of the ODR must be acceptable to Florida Housing, its
legal counsel, and its Servicer.
15. A copy of an Amended and Restated Operating Agreement reflecting purchase of the HC
under terms consistent with the assumptions contained within this Credit Underwriting
Report. The Amended and Restated Operating Agreement shall be in a form and of
financial substance satisfactory to Servicer and to FHFC and its legal counsel.
This recommendation is contingent upon the review and approval of the following items by Florida
Housing, and its legal counsel at least two weeks prior to Loan Closing. Failure to receive
approval of these items, along with all other items listed on Florida Housing counsel’s due
diligence, within this time frame may result in postponement of the SAIL Loan closing date.
1. Documentation of the legal formation and current authority to transact business in Florida
for the Applicant, the general partner/principal(s)/manager(s) of the Applicant, the
guarantor, and any limited partners of the Applicant.
2. Signed and sealed survey, dated within 90 days of closing, unless otherwise approved by
Florida Housing, and its legal counsel, based upon the particular circumstances of the
transaction. The Survey shall be certified to Florida Housing and its legal counsel, as well
as the title insurance company, and shall indicate the legal description, exact boundaries of
the Development, easements, utilities, roads, and means of access to public streets, total
acreage and flood hazard area and any other requirements of Florida Housing.
Exhibit G
Page 32 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page B-5
October 17, 2019
3. An acceptable updated Environmental Audit Report, together with a reliance letter to
Florida Housing, prepared within 180 days of closing, unless otherwise approved by
Florida Housing, and legal counsel, based upon the particular circumstances of the
transaction. Applicant to comply with any and all recommendations and remediation
restrictions noted in the Environmental Assessment(s) and Updates and the Environmental
Review, if applicable.
4. Title insurance pro forma or commitment for title insurance with copies of all Schedule B
exceptions, in the amount of the SAIL and ELI Loan naming FHFC as the insured. All
endorsements required by FHFC shall be provided.
5. Florida Housing and its legal counsel shall review and approve all other lenders closing
documents and the limited partnership or other applicable agreement. Florida Housing shall
be satisfied in its sole discretion that all legal and program requirements for the Loan(s)
have been satisfied.
6. Evidence of insurance coverage pursuant to the RFA governing this proposed transaction
and, as applicable, the FHFC Insurance Guide.
7. Receipt of a legal opinion from the Applicant's legal counsel acceptable to Florida Housing
addressing the following matters:
a. The legal existence and good standing of the Applicant and of any partnership or
limited liability company that is the general partner of the Applicant (the "GP") and of
any corporation or partnership that is the managing general partner of the GP, of any
corporate guarantor and any manager;
b. Authorization, execution, and delivery by the Applicant and the guarantor, of all
Loan(s) documents;
c. The Loan(s) documents being in full force and effect and enforceable in accordance
with their terms, subject to bankruptcy and equitable principles only;
d. The Applicant's and the Guarantor's execution, delivery and performance of the Loan(s)
documents shall not result in a violation of, or conflict with, any judgments, orders,
contracts, mortgages, security agreements or leases to which the Applicant is a party or
to which the Development is subject to the Applicant’s Partnership Agreement and;
e. Such other matters as Florida Housing or its legal counsel may require.
Exhibit G
Page 33 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page B-6
October 17, 2019
8. Evidence of compliance with the local concurrency laws, if applicable.
9. Such other assignments, affidavits, certificates, financial statements, closing statements
and other documents as may be reasonably requested by Florida Housing or its legal
counsel in form and substance acceptable to Florida Housing or its legal counsel, in
connection with the Loan(s).
10. UCC Searches for the Applicant, its partnerships, as requested by legal counsel.
11. Any other reasonable conditions established by Florida Housing and its legal counsel.
Exhibit G
Page 34 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page B-7
October 17, 2019
Additional Conditions
This recommendation is also contingent upon satisfaction of the following additional conditions:
1. Compliance with all provisions of Sections 420.507 and 420.5087 Florida Statutes, Rule
Chapter Rule 67-48 F.A.C. (SAIL and 9% HC Programs), Rule Chapter 67-53, F.A.C.,
Rule Chapter 67-60 F.A.C., RFA 2018-103, Section 42 I.R.C. (Housing Credits), and
any other State or Federal requirements.
2. Acceptance by the Applicant and execution of all documents evidencing and securing the
SAIL and ELI Loans in form and substance satisfactory to Florida Housing, including,
but not limited to, the Promissory Note(s), the Loan Agreement(s), the Mortgage and
Security Agreement(s), and the Land Use Restriction Agreement(s) and/or Extended
Land Use Agreement(s) and Final Cost Certificate.
3. Guarantors to provide the standard FHFC Construction Completion Guaranty, to be
released upon lien-free completion, as approved by the Servicer.
4. For the SAIL Loan, Guarantors are to provide the standard FHFC Operating Deficit
Guaranty. If requested in writing by the Applicant, the Servicer will consider a
recommendation to release the Operating Deficit Guaranty if all conditions are met,
including achievement of a 1.15x debt service coverage for the permanent first mortgage
SAIL Loan, as determined by FHFC, or its Servicer, and 90 percent occupancy, and 90
percent of the gross potential rental income, net of utility allowances, if applicable, for a
period equal to 12 consecutive months, all as certified by an independent Certified Public
Accountant, and verified by the Servicer. The calculation of the debt service coverage
ratio shall be made by FHFC or the Servicer. Notwithstanding the above, the Operating
Deficit Guaranty shall not terminate earlier than three (3) years following the final
certificate of occupancy.
5. Guarantors to provide the Standard FHFC Environmental Indemnity Guaranty.
6. Guarantors to provide the Standard FHFC Guaranty of Recourse Obligations.
7. If applicable, receipt and satisfactory review of Financial Statements from all Guarantors
dated within 90 days of Loan Closing.
8. A Mortgagee Title Insurance policy naming Florida Housing as the insured in the amount
of the Loan(s) is to be issued immediately after closing. Any exceptions to the title
Exhibit G
Page 35 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page B-8
October 17, 2019
insurance policy must be acceptable to Florida Housing or its legal counsel. The form of
the title policy must be approved prior to closing.
9. Property tax and hazard insurance escrow are to be established and maintained by the
First Mortgagee Lender, Fiscal Agent, or the Servicer. In the event the reserve account is
held by Florida Housing's Loan(s) servicing agent, the release of funds shall be at Florida
Housing's sole discretion.
10. Replacement Reserves in the amount of $300 per unit per year will be required to be
deposited on a monthly basis into a designated escrow account, to be maintained by the
First Mortgagee or Florida Housing's Loan(s) servicing agent. However, Applicant has
the option to prepay Replacement Reserves, as allowed per Rule 67-48 F.A.C., in the
amount of $32,400 (one-half the required Replacement Reserves for Years 1 and 2), in
order to meet the applicable DSC loan requirements. Applicant can waive this election,
if at closing of the loan(s) the required DSC is met without the need to exercise the option.
It is currently estimated that Replacement Reserves will be funded from Operations in
the amount of $300 per unit per year for years 1 and 2, followed by $300 per unit per
year thereafter. The initial replacement reserve will have limitations on the ability to be
drawn. New construction developments shall not be allowed to draw during the first five
(5) years or until the establishment of a minimum balance equal to the accumulation of
five (5) years of replacement reserves per unit. The amount established as a replacement
reserve shall be adjusted based on a CNA to be received by FHFC or its servicers,
prepared by an independent third party and acceptable to FHFC and its servicers at the
time the CNA is required, beginning no later than the tenth year after the first residential
building in the Development receives a certificate of occupancy, a temporary certificate
of occupancy, or is placed in service, whichever is earlier (“initial replacement reserve
date”). A subsequent CNA is required no later than the 15
th
year after the initial
Replacement Reserve Date and subsequently every five (5) years thereafter.
11. A minimum of 10% retainage holdback on all construction draws until the Development
is 50% complete, and 0% retainage thereafter is required. Retainage will not be released
until successful completion of construction and issuance of all certificates of occupancy.
The construction contract specifies a 10% retainage until 50% of construction
completion, at which time retainage shall be reduced to 0%, which satisfies the minimum
requirement.
12. Closing of all funding sources prior to or simultaneous with the SAIL and ELI Loan.
13. Satisfactory completion of a pre-loan closing compliance audit conducted by FHFC or
Servicer, if applicable.
Exhibit G
Page 36 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page B-9
October 17, 2019
14. Satisfactory resolution of any outstanding past due and/or noncompliance items.
15. Any other reasonable requirements of the Servicer, Florida Housing, or its legal counsel.
Exhibit G
Page 37 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Page B-10
October 17, 2019
Housing Credit Allocation Recommendation
First Housing Development Corporation has estimated a preliminary annual HC allocation of
$1,510,000. Please see the HC Allocation Calculation in Exhibit 2 of this report for further details.
Contingencies
The HC allocation will be contingent upon the receipt and satisfactory review of the following
items by First Housing and Florida Housing by the deadline established in the Preliminary
Determination. Failure to submit these items within this time frame may result in forfeiture of the
HC Allocation.
1. Purchase of the HC’s by Enterprise, or an affiliated entity, under terms consistent with
assumptions of this report.
2. Satisfactory resolution of any outstanding past due and/or noncompliance items.
3. Receipt of executed FHFC Fair Housing, Section 504, and ADA as built certification forms
122, 127, 129.
4. Any other reasonable requirements of the Servicer, Florida Housing, or its Legal Counsel.
Exhibit G
Page 38 of 48
SAIL, ELI & HC CREDIT UNDERWRITING REPORT FHDC
Heritage Park at Crane Creek Exhibit 1, Page 1
October 17, 2019
15 Year Operating Pro Forma – Heritage Park at Crane Creek
FINANCIAL COSTS:
Year 1
Year 2
Year 3
Year 4
Year 5
Year 6
Year 7
Year 8
Year 9
Year 10
Year 11
Year 12
Year 13
Year 14
Year 15
OPERATING PRO FORMA
Gross Potentia l Renta l Income $766,272 $781,597 $797,229 $813,174 $829,437 $846,026 $862,947 $880,206 $897,810 $915,766 $934,081 $952,763 $971,818 $991,255 $1,011,080
Other Income
Mis cella neous $13,000 $13,260 $13,525 $13,796 $14,072 $14,353 $14,640 $14,933 $15,232 $15,536 $15,847 $16,164 $16,487 $16,817 $17,153
Gross Potentia l Income $779,272 $794,857 $810,755 $826,970 $843,509 $860,379 $877,587 $895,139 $913,041 $931,302 $949,928 $968,927 $988,305 $1,008,071 $1,028,233
Les s :
Phys i cal Va c. Los s Percentage: 6.00% $46,756 $47,691 $48,645 $49,618 $50,611 $51,623 $52,655 $53,708 $54,782 $55,878 $56,996 $58,136 $59,298 $60,484 $61,694
Coll ection Los s Percentage: 1.00% $7,793 $7,949 $8,108 $8,270 $8,435 $8,604 $8,776 $8,951 $9,130 $9,313 $9,499 $9,689 $9,883 $10,081 $10,282
Total Effective Gross Income $724,723 $739,217 $754,002 $769,082 $784,463 $800,153 $816,156 $832,479 $849,128 $866,111 $883,433 $901,102 $919,124 $937,506 $956,257
Fixed:
Real Esta te Taxes $55,073 $56,725 $58,427 $60,180 $61,985 $63,845 $65,760 $67,733 $69,765 $71,858 $74,014 $76,234 $78,521 $80,877 $83,303
Insurance $54,000 $55,620 $57,289 $59,007 $60,777 $62,601 $64,479 $66,413 $68,406 $70,458 $72,571 $74,749 $76,991 $79,301 $81,680
Va ria ble:
Mana geme nt Fe e Percentage: 6.00% $43,483 $44,353 $45,240 $46,145 $47,068 $48,009 $48,969 $49,949 $50,948 $51,967 $53,006 $54,066 $55,147 $56,250 $57,375
General a nd Admi nis trative $48,600 $50,058 $51,560 $53,107 $54,700 $56,341 $58,031 $59,772 $61,565 $63,412 $65,314 $67,274 $69,292 $71,371 $73,512
Payrol l Expenses $156,600 $161,298 $166,137 $171,121 $176,255 $181,542 $186,989 $192,598 $198,376 $204,327 $210,457 $216,771 $223,274 $229,972 $236,872
Utilities $89,100 $91,773 $94,526 $97,362 $100,283 $103,291 $106,390 $109,582 $112,869 $116,255 $119,743 $123,335 $127,035 $130,846 $134,772
Marketing a nd Advertisi ng $3,240 $3,337 $3,437 $3,540 $3,647 $3,756 $3,869 $3,985 $4,104 $4,227 $4,354 $4,485 $4,619 $4,758 $4,901
Mai ntenance a nd Re pairs /Pest Control $59,400 $61,182 $63,017 $64,908 $66,855 $68,861 $70,927 $73,055 $75,246 $77,504 $79,829 $82,223 $84,690 $87,231 $89,848
Grounds Ma intenance and Lands ca ping $10,800 $11,124 $11,458 $11,801 $12,155 $12,520 $12,896 $13,283 $13,681 $14,092 $14,514 $14,950 $15,398 $15,860 $16,336
Securi ty $27,000 $27,810 $28,644 $29,504 $30,389 $31,300 $32,239 $33,207 $34,203 $35,229 $36,286 $37,374 $38,496 $39,650 $40,840
Othe r $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Reserve for Repla cements $32,400 $32,400 $32,400 $32,400 $32,400 $32,400 $32,400 $32,400 $32,400 $32,400 $33,372 $34,373 $35,404 $36,466 $37,560
Total Expenses $579,696 $595,680 $612,135 $629,075 $646,514 $664,467 $682,948 $701,975 $721,563 $741,728 $763,461 $785,834 $808,869 $832,583 $856,998
Net Operating Income $145,027 $143,537 $141,866 $140,007 $137,950 $135,686 $133,207 $130,504 $127,566 $124,383 $119,973 $115,268 $110,255 $104,923 $99,258
Debt Service Payments
First Mortga ge - SAI L $20,299 $20,299 $20,299 $20,299 $20,299 $20,299 $20,299 $20,299 $20,299 $20,299 $20,299 $20,299 $20,299 $20,299 $20,299
Second Mortga ge - ELI
$0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0 $0
Thi rd Mortgage - Stea dytown $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000 $100,000
$11,246 $11,274 $11,303 $11,333 $11,364 $11,395 $11,428 $11,462 $11,496 $11,532 $11,569 $11,606 $11,645 $11,685 $11,727
$3,530 $3,558 $3,587 $3,617 $3,648 $3,679 $3,712 $3,746 $3,780 $3,816 $3,853 $3,890 $3,929 $3,969 $4,011
Total Debt Servi ce Payme nts $135,075 $138,689 $138,776 $138,866 $138,958 $139,053 $139,151 $139,252 $139,355 $139,462 $139,573 $139,686 $139,803 $139,923 $140,047
Cas h Fl ow a fter De bt Servi ce $9,952 $4,848 $3,090 $1,141 -$1,008 -$3,367 -$5,943 -$8,748 -$11,790 -$15,080 -$19,600 -$24,418 -$29,548 -$35,000 -$40,789
FINANCIAL COSTS:
Annual
Annual
Annual
Annual
Annual
Annual
Annual
Annual
Annual
Annual
Annual
Annual
Annual
Annual
Annual
Debt Service Coverage Ratios
DSC - Fi rst Mortgage pl us Fees 4.60 4.55 4.49 4.43 4.36 4.28 4.20 4.11 4.01 3.91 3.76 3.61 3.45 3.28 3.10
DSC - Second Mortgage plus Fee s 4.13 4.09 4.03 3.97 3.91 3.84 3.76 3.68 3.59 3.49 3.36 3.22 3.07 2.92 2.75
DSC - Thi rd Mortga ge plus Fees 1.07 1.03 1.02 1.01 0.99 0.98 0.96 0.94 0.92 0.89 0.86 0.83 0.79 0.75 0.71
Financial Ratios
Opera ting Expens e Rati o 79.99% 80.58% 81.18% 81.80% 82.41% 83.04% 83.68% 84.32% 84.98% 85.64% 86.42% 87.21% 88.00% 88.81% 89.62%
Brea k-even Economi c Occupancy Ratio (al l debt) 92.14% 92.81% 93.04% 93.28% 93.54% 93.81% 94.10% 94.40% 94.71% 95.04% 95.48% 95.94% 96.41% 96.89% 97.39%
EXPENSES:
INCOME:
First Mortga ge Fees - SAIL
Second Mortga ge Fe e s - ELI
Note: The Steadytown loan will amortize based on 80% of available cash flow, after payment of all senior loans; therefore, DSC will not fall below
1.0. First Housing used a 30-year amortization schedule for presentation purposes only.
Exhibit G
Page 39 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT
FHDC
Heritage Park at Crane Creek Exhibit 2, Page 1
October 17, 2019
HC Allocation Calculation
Section I: Qualified Basis Calculation
Total De velopme n t Costs(incl uding l and and ine l igible Costs)
$22,045,804
Less Lan d C osts
$1,100,000
Less Fe deral Grants and Loans
$0
Less O the r Ine l igible Costs
$2,107,932
Total Eligi ble Basis
$18,837,872
Applicabl e Fraction
74.1%
DDA/Q CT Basis Credit
130%
Q u alifie d Bas is
$18,146,522
Housing C re dit Percentage
9.00%
Annual Hou sing Credit All ocati on
$1,633,187
Notes to Qualified Basis Calculation:
1. Other ineligible costs include; FHFC Fees, Closing Costs, Advertising/Marketing Fees,
and Operating Deficit Reserves required by the syndicator.
2. The Development has a 74.1% set-aside. Therefore, the Applicable Fraction is 74.1%.
3. For purposes of this analysis, the Development is located in a Difficult Development Area
("DDA") and/or Qualified Census Tract ("QCT"); therefore the 130% basis boost was
applied.
4. For purposes of this recommendation a HC percentage of 9% was applied based on the 9%
floor rate which as permanently extended through the Protecting Americans from Tax
Hikes (PATH) Act of 2015 as part of the Omnibus Consolidated Appropriations Act of
2016.
Exhibit G
Page 40 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT
FHDC
Heritage Park at Crane Creek Exhibit 2, Page 2
October 17, 2019
Section II: GAP Calculation
Total Deve lopment Costs(including land and inel igible Costs)
$22,045,804
Less Mortgage s
$7,469,500
Less Grants
$0
Equity Gap
$14,576,304
HC Syndication Pe rcentage to Investment Partnership
99.99%
HC Syndication Pricing
$0.9375
HC Required to me et Equity Gap
$15,549,612
Annual HC Require d
$1,554,961
Notes to GAP Calculation:
1. HC Syndication Pricing and Percentage to Investor Limited Partner are based on the
preliminary commitment from Enterprise.
Section III: Summary
HC Pe r Appl ication
$1,510,000
HC Pe r Q ualifie d Basis
$1,633,187
HC Pe r GAP Calculation
$1,554,961
Annual HC Recommended
$1,510,000
Syndication Proceeds based upon Syndication Agreeme nt
$14,156,250
Notes to Summary Calculation:
1. The Annual HC Recommendation is limited by the Applicant’s Request.
2. FHFC reserves the right to resize the Housing Credits preliminarily awarded to the
Applicant. The next opportunity for a feasibility review of this transaction will be during
credit underwriting. If the final credit underwriting report indicates a need to resize the HC
allocation, FHFC will do so at that time.
Exhibit G
Page 41 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT
FHDC
Heritage Park at Crane Creek Exhibit 3, Page 1
October 17, 2019
EXHIBIT “B”
(Heritage Park at Crane Creek / RFA 2018-103 / 2018-344CS)
DESCRIPTION OF FEATURES AND AMENITIES
The Development will consist of:
108 apartment units located in 1 mid-rise building.
Unit Mix:
Forty-nine (49) one bedroom/one bath units containing a minimum of 618 square feet of
heated and cooled living area.
Fifty-one (51) two bedroom/two bath units containing a minimum of 935 square feet of
heated and cooled living area.
Eight (8) three bedroom/two bath units containing a minimum of 1,079 square feet of
heated and cooled living area.
108 Total Units
All units are expected to meet all requirements as outlined below. The Development is to be
constructed in accordance with the final plans and specifications approved by the authority having
jurisdiction and approved as reflected in the Pre-Construction Analysis prepared for Florida
Housing or its Servicer, unless a change has been approved in writing by Florida Housing. The
Development will conform to requirements of local, state & federal laws, rules, regulations,
ordinances, orders and codes.
a. Federal Requirements and State Building Code Requirements for all
Developments
All proposed Developments must meet all federal requirements and state
building code requirements, including the following:
• Florida Accessibility Code for Building Construction as adopted
pursuant to Section 553.503, Florida Statutes;
• The Fair Housing Act as implemented by 24 CFR 100;
• Section 504 of the Rehabilitation Act of 1973*; and
• Titles II and III of the Americans with Disabilities Act of 1990 as
implemented by 28 CFR 35, incorporating the most recent
amendments, regulations and rules.
*
Section 504 of the total Rehabilitation Act of 1973 requirements are met through the Applicants
commitment to meet Level 1 requirements described in c. below.
Exhibit G
Page 42 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT
FHDC
Heritage Park at Crane Creek Exhibit 3, Page 2
October 17, 2019
b. General Features
1) All units for the proposed Development must include:
• Termite prevention;
• Pest control;
• Full-size range and oven in all units;
• Window covering for each window and glass door inside each unit;
• Cable or satellite TV hook-up in each unit and, if the Development
offers cable or satellite TV service to the residents, the price cannot
exceed the market rate for service of similar quality available to
the Development’s residents from a primary provider of cable or
satellite TV;
• Washer and dryer hook ups in each of the Development’s units or
an on-site laundry facility for resident use. If the proposed
Development will have an on-site laundry facility, the following
requirements must be met:
o There must be a minimum of one (1) Energy Star certified
washer and one (1) Energy Star certified dryer per every 15
units. To determine the required number of washers and dryers
for the on-site laundry facility; divide the total number of the
Development’s units by 15, and then round the equation’s total
up to the nearest whole number; and
o If the proposed Development consists of Scattered Sites, the
laundry facility shall be located on each of the Scattered Sites,
or no more than 1/16 mile from the Scattered Site with the
most units, or a combination of both.
• At least two full bathrooms in all 3 bedroom or larger new
construction units.
2) All Proposed Developments must include the following general features
on the site.
• A Community Building/dedicated space that includes:
o At least one private office space with a door for resident purposes
such as meeting with case managers and/or counselors; and
o At least one enclosed training room with a door to conduct group
training and educational activities for residents.
c. Accessibility Adaptability, Universal Design and Visitability Features
Exhibit G
Page 43 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT
FHDC
Heritage Park at Crane Creek Exhibit 3, Page 3
October 17, 2019
Level 1 Accessibility Requirements
The Applicant shall be required to do the following:
(i) Set aside a minimum of twenty-five (25) percent of the total units, rounded
up, as fully accessible units in accordance with the 2010 ADA Standards
for Accessible Design, regardless of whether the proposed Development
consists of new construction or Substantial Rehabilitation. These fully
accessible units must (A) be on an accessible route and provide mobility
features that comply with the residential dwelling units provision of the
2010 ADA Standards for Accessible Design; and (B) be equally distributed
among different unit sizes and Development types and must be dispersed
throughout the Development (not located in the same area, or on a single
floor); and
(ii) Set aside at least one (10) percent of the total units to be accessible to
persons with visual and hearing impairments in accordance with the 2010
ADA Standards for Accessible Design, regardless of whether the proposed
Development consists of new construction or Substantial Rehabilitation.
The units that are accessible to persons with visual and hearing impairments
shall comply with the communication features described for Residential
Dwelling Units with Communication Features in the 2010 ADA Standards
for Accessible Design.
d. Required Green Building Features in all Developments
(1) All new construction units must have the features listed below:
· Low or No-VOC paint for all interior walls (Low-VOC means 50
grams per liter or less for flat; 150 grams per liter or less for non-flat
paint);
· Low-flow water fixtures in bathrooms—WaterSense labeled products
or the following specifications:
o Toilets: 1.28 gallons/flush or less,
o Faucets: 1.5 gallons/minute or less,
o Showerheads: 2.0 gallons/minute or less;
· Energy Star certified refrigerator;
· Energy Star certified dishwasher;
· Energy Star certified ventilation fan in all bathrooms;
· Water heater minimum efficiency specifications:
o Residential Electric:
§ Up to 55 gallons = .95 EF or .92 UEF; or
§ More than 55 gallons = Energy Star certified; or
Exhibit G
Page 44 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT
FHDC
Heritage Park at Crane Creek Exhibit 3, Page 4
October 17, 2019
§ Tankless = Energy Star certified;
o Residential Gas (storage or tankless/instantaneous): Energy Star
certified,
o Commercial Gas Water Heater: Energy Star certified;
· Energy Star certified ceiling fans with lighting fixtures in bedrooms;
· Air Conditioning (choose in-unit or commercial) *:
o In-unit air conditioning: minimum 15 SEER; or
o Ductless mini-split systems – Energy Star certified;
o Window air conditioners and portable air conditioners are not
allowed. Through the wall units and PTACs are allowed in studio
and 1 bedroom units;
o Through the wall units – Energy Star certified
o PTACS – minimum EER based on capacity:
§ <6,900 Btu/h – 12.8 EER
§ 6,901-9,400 – 12 EER
§ 9,401-11,500 – 11.2 EER
§ 11,501 – 14,700 – 10.4 EER
§ >14,700 – 10.2 EER
o Central chiller AC system—based on size:
§ 0-65 KBtuh: Energy Star certified; or
§ 65-135 KBtuh: 11.9 EER; or
§ 135-240 KBtuh: 12.3 EER; or
§ 240 KBtuh: 12.2 EER;
· Caulk, weather-strip, or otherwise seal all holes, gaps, cracks,
penetrations, and electrical receptacles in building envelope; and
· Seal and insulate heating and cooling system ducts with mastic or
metal backed tape.
(2) This New Construction Development commits to provide the following
Green Building Certification program:
_______ Leadership in Energy and Environmental Design (LEED); or
_______ Florida Green Building Coalition (FGBC); or
___X___ ICC 700 National Green Building Standard (NGBS).
e. Resident Programs
Resident Community-Based Services Coordination
The provision of community-based services coordination will be the responsibility
of the Applicant, but may be in conjunction with public and/or private partnerships
Exhibit G
Page 45 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT
FHDC
Heritage Park at Crane Creek Exhibit 3, Page 5
October 17, 2019
as approved by FHFC in credit underwriting. All proposed Developments will be
required to assist interested residents with the coordination of their community-
based services. The purpose is to assist each resident to become aware of, access
and/or maintain adequate and appropriate community-based services and resources.
It is not the intent for this resident service to take the place of services coordination
already provided for a resident by a program and/or agency as part of their
supportive services plan. The focus shall be to assist residents not receiving
community-based services coordination by another program and/or agency, as well
as to assist those residents who need additional assistance with coordination of
community-based services.
The approved provider of this service must have a minimum of three (3) years’
experience administering and providing supportive services including outreach,
information and referral services, benefits counseling, community-based services
planning and coordination, and/or other related supportive services. Such
experience must demonstrate that the supportive services listed above have been
oriented to the needs and preferences of each intended resident in assisting them to
access services related to health care, independent activities of daily living,
employment, income and housing. The provider of this resident service shall also
provide, at credit underwriting, information demonstrating its mission,
qualifications, experience, agreements and/or contracts with state and federal
supportive services programs, professional staffing and experience in serving the
intended residents described in question 2.b. of Exhibit A.
Community-based services coordination shall be offered and made available on-
site and at no charge to the residents initially and regularly, and resident
participation shall be voluntary. If the proposed Development consists of Scattered
Sites, the community-based services coordination shall be equally available to
residents of each unit on each Scattered Site. Resident participation shall not be a
requirement for new or continued residency. The Applicant shall commit to submit
a Resident Community-Based Service Coordination Plan at credit underwriting.
The Resident Community-Based Service Coordination Plan shall adhere to
guidelines developed by FHFC, in conjunction with state agencies, or their
designee(s), that administer publicly funded supportive services for the intended
residents.
Property management and resident community-based services coordination should
not be the responsibility of the same staff persons; the functions must be entirely
separate.
Exhibit G
Page 46 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT
FHDC
Heritage Park at Crane Creek Exhibit 4, Page 1
October 17, 2019
DEVELOPMENT
NAME: Heritage Park at Crane Creek
DATE: October 17, 2019
In accordance with the applicable Program Rule(s), the applicant is required to submit the information required to evaluate,
complete, and determine its sufficiency in satisfying the requirements for Credit Underwriting to the Credit Underwriter in
accordance with the schedule established by the Florida Housing Finance Corporation ("FHFC"). The following items must be
satisfactorily addressed. "Satisfactorily" means that the Credit Underwriter has received assurances from third parties unrelated
to the applicant that the transaction can close within the allowed time frame. Unsatisfactory items, if any, are noted below in the
"Issues and Concerns" section of the Executive Summary.
FINAL REVIEW
REQUIRED ITEMS:
STATUS NOTE
Satis. / Unsatis.
1. The development’s final “as submitted for permitting” plans and specifications.
Note: Final “signed, sealed, and approved for construction” plans and specifications will
be required thirty days before closing.
Satis.
2. Final site plan and/or status of site plan approval. Satis.
3. Permit Status. Satis.
4. Pre-construction analysis (“PCA”).
a. No construction costs exceeding 20% is subcontracted to any one entity with the
exception of a subcontractor contracted to deliver the building shell of a building
of at least 5 stories which may not have more than 31% of the construction cost in
a subcontract.
b. No construction costs is subcontracted to any entity that has common ownership
or is an affiliate of the general contractor of the developer.
Satis.
Satis.
Satis.
5. Survey. Satis.
6. Complete, thorough soil test reports. Satis
7. Full or self-contained appraisal as defined by the Uniform Standards of
Professional Appraisal Practice.
Satis.
8. Market Study separate from the Appraisal. Satis.
9. Environmental Site Assessment – Phase I and/or the Phase II if applicable (If Phase
I and/or II disclosed environmental problems requiring remediation, a plan,
including time frame and cost, for the remediation is required). If the report is not
dated within one year of the Application date, an update from the assessor must be
provided indicating the current environmental status.
Satis.
10. Audited financial statements for the most recent fiscal year ended or acceptable
alternative as stated in Rule for credit enhancers, applicant, general partner,
principals, guarantors and general contractor.
Satis.
11. Resumes and experience of applicant, general contractor and management agent.
Confirmed active status on Sunbiz for Applicant, Developer, and GC entities.
Satis.
12. Credit authorizations; verifications of deposits and mortgage loans. Satis.
13. Management Agreement and Management Plan. Satis.
14. Firm commitment from the credit enhancer or private placement purchaser, if any. N/A
15. Firm commitment letter from the syndicator, if any. Satis.
Exhibit G
Page 47 of 48
SAIL, ELI, & HC CREDIT UNDERWRITING REPORT
FHDC
Heritage Park at Crane Creek Exhibit 4, Page 2
October 17, 2019
16. Firm commitment letter(s) for any other financing sources. Unsatis. 1
17. Updated sources and uses of funds. Satis.
18. Draft construction draw schedule showing sources of funds during each month of
the construction and lease-up period.
Unsatis. 2
19. Fifteen-year income, expense, and occupancy projection. Satis.
20. Executed general construction contract with "not to exceed" costs. Satis.
21. HC ONLY: 15% of the total equity to be provided prior to or simultaneously with
the closing of the construction financing.
Satis.
22. Any additional items required by the credit underwriter. Satis.
23. Receipt of executed Florida Housing Fair Housing, Section 504 and ADA Design
Certification Forms 121, 126, and 128.
Satis.
24. If the owner has a HAP Contract or ACC with HUD, then receipt of HUD approval
for an owner-adopted preference or limited preference specifically for individuals
or families who are referred by a designated Referral Agency serving the county
where the Development is located.
N/A
25. Receipt of Tenant Eligibility and Selection Plan Satis.
26. Receipt of GC Certification Satis.
27. Reliance for FHDC as agent for FHFC is include in all applicable third party
reports:
Appraisal, Market Study, PCA, CNA, and Phase I.
Satis.
NOTES AND DEVELOPER RESPONSES:
Notes:
1. Receipt of firm commitments from BOA, Steadytown, and Enterprise are closing
conditions.
2. A draft construction draw schedule has not been provided. Receipt of a final construction
draw schedule is a condition to close.
Exhibit G
Page 48 of 48
