Transcript CHARTER SCHOOL FINANCING

The Reinvestment Fund
Governor’s Housing Conference:
Strengthening Vibrant Communities
October 16, 2012
TRF Profile
The Reinvestment Fund builds wealth and opportunity
for low-wealth people and places through the
promotion of socially and environmentally responsible
development.
 $1.1 billion in cumulative
investments and loans
throughout the mid-Atlantic
 Currently manage $682 million
in capital, with nearly 830
investors
Business Lines
Lending and
Investing
Policy Solutions
TRF
Development
Partners
PolicyMap
Capital at the Point of Impact
TRF is a national leader in rebuilding America’s
distressed towns and cities, through the innovative
use of capital and information. We apply these
resources towards:
 residential and commercial real estate development
that reclaim and revitalize neighborhoods
 businesses and community facilities that can provide
value and opportunity to neighborhood residents
CARS
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CARS™, the CDFI Assessment and Rating System, is a
comprehensive, third-party analysis of community
development financial institutions that aids investors and
donors in their investment decision-making.
Organizations are rated based on
– Impact performance
– Policy Plus
– Financial Strength and Performance
TRF has maintained the top score in all three categories,
with an AAA+1 rating
(most recent 2012)
PolicyMap – www.policymap.com
All the data you need. All in one place. All online.
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National data
mapping and
analysis tool
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Easy, online
access to data
and analytical
tools in a
sophisticated yet
user-friendly web
platform
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Over 15,000 data
indicators as well
as proprietary
TRF analytics,
with frequent
additions.
Policy Solutions
We combine our rigorous data analysis with a
distinctive ability to help clients think spatially.
 Real Estate Market Analysis
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Market Value Analysis
High leverage investment areas
Commercial corridors analysis
Foreclosure analysis and prevention
strategies
 Program & Social Impact Assessment
– Estimating Supermarket Access, School
Lunch Analysis,
Grantmaker Advisory
TRF Development Partners
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TRF Development Partners works in
neighborhoods across the mid-Atlantic
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Has created 279 units of housing and secured
over $110 million towards development in the
last 5 years alone.
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In Baltimore’s Oliver neighborhood, TRF DP’s
efforts have resulted in a 25% drop in total
vacant homes in the target area.
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TRF DP’s housing investments continue to
thrive because of three tenets:
– Building from strength
– Development with an understanding of the
existing built environment
– Homes that are designed with eye towards
quality and high design standards
TRF Development Partners
 Greenmount West
 City Arts Apartments (69
units)
 City Arts Lofts (7 units)
 City Arts Historic (9 units)
 East Baltimore
 Preston Place (64 completed,
15 under construction)
 Participating with the City’s
Vacants-to-Value initiative
 Partnership with EBDI for
acquisition/rehabs of 33
houses on Broadway
TRF Development Partners
Preston Place - Rehabs
TRF in Baltimore
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Serving Baltimore for nearly a decade
Loaned and invested over $50 million in Baltimore
Supported $33 million in direct housing development
Provided policy and planning solutions to a substantial
number of local clients including government, foundations
and private institutions
 Manage capital dedicated for Baltimore from Living Cities
and the Annie E. Casey Foundation.
 Have raised other philanthropic and bank capital for
Maryland lending.
 Working to expand our local investor base.
TRF Lending
TRF Loans support safe, affordable
homes, quality education,
neighborhood retail, energy efficiency
and generation and access to fresh,
healthy food.
 Loan Products
 Predevelopment
 Acquisition
 Construction (up to 24 months)
 Permanent (up to 7/20)
 New Market Tax Credits
Orchard Ridge
City Neighbors Charter School
TRF Lending
Underwriting and structuring of
loans based on:
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Photo by Greg Pease
Borrower’s financial condition
Development experience
Availability of collateral
Ability to repay
TRF Lending
Threshold feasibility:
 Adequate cost projections and
proposed sources
 Demonstration of how proposed
rents and sales prices are
supported in the market
 Capacity of the development
team to successfully complete
the project.
The Green School, Baltimore MD
TRF Lending
Example Project: Construction Loan for 12 For-Sale Units
Total Development Cost:
Construction Loan:
$3.5 million
$650,000 to be taken out by unit sales
Balance is NSP funds
24 month term, interest only
Rate is floating based on LIBOR
Loan Conditions were:
Minimum as-completed appraised value to ensure LTV can be maintained. (LTV
maximum here was 80%)
Approval of development team financials and track record
Cost and plans review by third party
Subsidy sources are drawn down first
Evaluation of for-sale market and asking prices
TRF Lending
Underwriting Questions/ Risk Mitigation
 Are there sufficient funds for a contingency?
 Who is the target market and do they have sufficient income to
qualify for the purchase?
 How much cushion in the sales prices exists?
 Timing of the draw down of loan relative to other sources
 Is there a “backup plan” if the houses take longer to sell?
Contact Information
Dana Johnson
Baltimore Market Leader
410.783.1110
[email protected]