Transcript Old Morrison Homes

Old Morrison Homes
Adding Value to New Orleans East
Old Morrison Homes
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Old Morrison Homes Overview
Earning Equity
Tax Credit Overview
Benefits of Development
VOB Tax Credit Experience
Community Partner Commitment
Old Morrison Homes Overview
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36 Single Family Homes
21 3br ($800/mo) & 17 4br ($900/mo) Homes
1675 Average Sq Ft
$180,000 Cost/Home, ~$200k Average Retail Value
Lease-Purchase Program (65% minimum of payments will go
toward purchase of home after 15 years)
Professional property management onsite, no absentee
landlord
All tenants must meet strict criteria and be screened
3,000 sf Community Center will be constructed
Developers are responsible for all maintenance, taxes &
property insurance over 15 year compliance period.
Earning Equity
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Assume 2/3 (66%) of monthly payments will applied to the purchase price.
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Assume monthly payments total $150K over the 15 year leasing
period and price of home is $200,000.
Thus, in year 16 $100K (that is, 2/3 * $150K  $100K) is applied to
mortgage principal of $200K.
Also after 15 years, only $100K remains to be owed on the home.
After 15 years, at an average increase of 2.5% in the valuation of the
home (i.e. increased equity), the $200K home would be worth
$289,000K.
Therefore, the resident with only $100,000 remaining on the
mortgage principal would realize an equity in excess of $189K in year
16.(SEE TABLE)
Earning Equity (EXAMPLE)
Year
Value of Home (Assumption of
2.5% increase in value)
1
$200,000
2
$208,000
………
15
$264,000
16
$289,000
In Year 16, resident owes ONLY $100,000 on home worth $289,000
Thus, resident earns $189,000 in equity in Year 16.
Old Morrison Homes Overview
Tax Credit Overview
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Purpose
Process
Income Requirements of Tenants
Property Management Guidelines
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Onsite Management
Resident Acceptance Criteria
Community Development Opportunity
Resident Profile = Working Class
Occupation
Average Salary
Teacher
$31,000
Police
$35,500
Paralegals
$28,000
Retiree
$24,000
Fireman
$30,000
Office Workers
$25,000
VOB Tax Credit Experience
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6 Tax Credit developments completed and
under management in MS and TN
4 Tax Credit developments 90% complete in
LA, MS and TN
4 Tax Credit developments under construction
4 Tax Credit developments in predevelopment phase in LA and MS
VOB Tax Credit Experience
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All existing properties are positive influences
on neighborhoods
Example:
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Riverbend – uptown area of Memphis
Tax Credit program was a component of huge
economic growth
As residents moved in, New Markets Tax Credits
and other revitalization investments were made
VOB Development properties
Canton, MS
Jackson, MS
Chattanooga, TN
Memphis TN
Baton Rouge, LA
Benefits of Development
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New Development in N.O. East
Increased population to benefit retail
revitalization
Lease-Purchase incentive program to spur
home ownership
Lease-Purchase is great alternative tool given
current economic conditions
Maintain/Increased value of avg home in area
Spurring economic development/jobs in area
Community Partner Commitment
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Tenant Selection & Screening Process
Onsite Management – No Absentee Landlord
Home Ownership Education Program
Home Owners Association Partnership
VOB will continue reinvest in the New
Orleans area
Core Old Morrison team is from N.O. East
and is committed to its recovery
Old Morrison Homes
Adding Value to New Orleans East