Dealmaker: Bellwether Enterprise Closes $72M for Affordable Housing

Bellwether Enterprise Real Estate Capital LLC, Cleveland, closed four loans totaling $72 million for affordable senior housing in Illinois and affordable multifamily housing in Maryland and New Jersey.

Victor Agusta, Executive Vice President in Bellwether Enterprise’s Raleigh, N.C. office, originated all four loans. The deals included:

City View at McCulloh
  • City View at McCulloh in Baltimore, which received a $29.1 million FHA loan. Loan sponsor The Community Builders Inc., Boston, refinanced the recently renovated 350-unit community at 501 Dolphin Street. Bellwether Enterprise reset the initial LIHTC and HUD-insured loan rate for the property through the FHA Interest Rate Reduction program, reducing debt service by more than $100,000 annually. City View at McCulloh previously underwent a RAD conversion and was substantially renovated in 2020.
  • Heiwa Terrace in Chicago, which received a $28.5 million FHA 221(d)(4)-insured construction and permanent loan with 4 percent Low-Income Housing Tax Credits on behalf of the sponsor, the Japanese-American Service Committee, Chicago.

    JASC developed Heiwa Terrace in 1978 using the HUD 202 program. The renovation will replace all mechanical systems, fully modernize the building and significantly upgrade the units. The first floor will be redesigned to improve circulation and natural lighting as well as create new physical and visual access to the Japanese garden in the courtyard. The sponsor also renewed a long-term Section 8 contract for residents.
  • Franklin Tower in Franklin Park, Ill. and Henrich House in Des Plaines, Ill. The Housing Authority of Cook County received a $6.5 million Freddie Mac Multifamily Affordable Housing permanent loan for this property. The development was completed with the help of capital raised by 9 percent LIHTCs and the establishment of a new long-term Section 8 contract through HUD’s Rental Assistance Demonstration.

Enterprise Housing Credit Investments also syndicated a $17 million investment for the acquisition and rehabilitation of the properties, its third investment with the Housing Authority of Cook County. Franklin Tower and Henrich House both serve low-income seniors.

  • Aston Heights in Newark, N.J., received a $7.8 million Freddie Mac permanent loan. The newly constructed affordable community was completed through a public-private partnership between Pennrose Properties, Philadelphia, and the Newark Housing Authority to transform a functionally obsolete public housing complex into a new mixed-income community. It was financed with 4 percent LIHTC loans from the Newark Housing Authority and a private construction loan that the new Freddie Mac loan paid off.

Nearly one-third of Aston Heights’ 154 units will be set aside for public housing and be subsidized by the Newark Housing Authority, while an additional 49 units will be subsidized by a long-term Section 8 Housing Assistance Program contract.