Community Housing Capital and Oppenheimer MH&HF, Inc. Announce Three Closed FHA 223(f) Loans to Preserve Affordable Senior and Disabled Housing in Rural Minnesota

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Three affordable senior and disabled housing projects in rural Minnesota have been preserved for another 35 years by refinancing existing high cost debt with three FHA 223(f) loans.

“OMHHF was great to work with considering the complexities created by three scattered site rural small Section 8 properties and now through their commitment and flexibility the Buffwood projects are positioned to be sustainable for the next 35 years.”

Known as the “Buffwood Project,” Southwest Minnesota Housing Partnership (SWMHP) brought a complex financing request to Community Housing Capital (CHC), a Community Development Financial Institution in Decatur, GA. SWMHP, a nonprofit affordable housing developer and member of the NeighborWorks® network, owned three Section 8 assisted properties in rural Minnesota that were burdened by existing high-cost debt. The three multifamily properties served low-income seniors and two of the projects also served younger low-income individuals with physical disabilities. In order to preserve the 129 units of much needed affordable rental housing, SWMHP needed to refinance the projects for longer term sustainability.

CHC and Oppenheimer Multifamily Housing & Healthcare Finance, Inc. (OMHHF) had earlier formed a partnership to make the process of applying for and obtaining FHA 223(f) loans easier and more affordable for members of the NeighborWorks network. CHC provide interim loans when needed and OMHHF provided long term permanent financing and loan servicing capabilities. CHC realized that the Minnesota projects would benefit from the longer term and lower interest rates of the FHA 223(f) program and that OMHHF had the loan origination and servicing expertise to handle the complex financing structure that included HOME and Minnesota Housing Finance Agency funds.

“When potential 223(f) transactions come to OMHHF from CHC, we have a higher comfort level with the developers due to the existing relationship they have with CHC. The borrowers we have worked with so far, understood the technical challenges associated with affordable housing development, which helped us underwrite and process quality deals through HUD” said Michael Hammond, SVP of Loan Origination, Oppenheimer Multifamily Housing & Healthcare Finance, Inc.

The three FHA 223(f) loans allowed SWHMP to refinance the projects by paying off high-cost housing bonds structured with 15-20 year terms and interest rates in the 6% range, to a fully amortizing 35-year term, with a 3.85% fixed interest rate. This new, stable financing structure improved cash flows and funded repairs and upgrades to the projects but more importantly, preserved this scarce housing resource in an underserved rural area of Minnesota.

“When CHC brought us together with OMHHF, we believed they would be a good partner that could help us navigate the financing structure and policy issues that were likely to be raised during the application process with HUD,” said Rick Goodemann, Chief Executive Officer, SWMHP. “OMHHF was great to work with considering the complexities created by three scattered site rural small Section 8 properties and now through their commitment and flexibility the Buffwood projects are positioned to be sustainable for the next 35 years.”

About Community Housing Capital
CHC is a national intermediary offering interim and permanent financing for the development and preservation of affordable housing. CHC is a CDFI, a member of the Federal Home Loan Bank Atlanta, is CARS Rated AA-2 and is a 501(c)(3). CHC’s resources serve as an economic catalyst in communities nationwide by financing strong, successful organizations focusing on the specific housing needs of their community. CHC's borrowers work tirelessly to improve their communities using a holistic approach. Their innovative spirit and community leadership promotes education achievement and job creation, better health outcomes and new investment in local communities. CHC’s ability to structure and finance these complex transactions has established CHC as the premier lender to the NeighborWorks network. Learn more at: http://www.CommunityHousingCapital.org.

About Oppenheimer Multifamily Housing & Healthcare Finance, Inc.
Oppenheimer Multifamily Housing & Healthcare Finance, Inc. a FHA MAP and LEAN approved direct mortgage lender, has been an affiliate of Oppenheimer Holdings (OPY) since 2002. Backed by the strength and depth of expertise offered by one of the most respected names in the financial services industry, this highly specialized group has grown into one of the Top 10 Commercial HUD Lenders, expanding to 26 offices nationwide and closing, on average, one billion dollars in FHA-insured loans each year for the last four years. Oppenheimer Multifamily Housing & Healthcare Finance, Inc. was one of the first Lenders approved to be a Low Income Housing Tax Credit Lender (LIHTC) in 2012.
Oppenheimer Multifamily Housing and Healthcare Finance, Inc. is dedicated to helping clients achieve their financial objectives for the acquisition, refinance, rehabilitation and construction of multifamily and healthcare properties by providing market-leading expertise and guidance with Oppenheimer’s signature personalized service — all without the bureaucratic red tape of a larger organization.

About Southwest Minnesota Housing Partnership
The Southwest Minnesota Housing Partnership (SWMHP) is a non-profit community development corporation and member of the NeighborWorks network. Serving thirty counties in rural Minnesota, SWMHP strives to make homeownership possible for more people by designing and building quality homes at affordable prices and by providing low-interest mortgages and closing cost assistance. SWMHP also helps to preserve the vitality of small communities in Minnesota by financing and rehabilitating homes and rental properties to meet local housing needs.

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