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Troubled affordable housing developer to transfer units
by Brian Bandell
One of the largest nonprofit affordable housing developers in Florida is winding down its business and transferring its properties to other developers to ensure they stay affordable.
On Jan. 10, the Miami-Dade County Commission will consider a motion to transfer loans its gave to Greater Miami Neighborhood for 18 development encompassing 2,080 units to two other affordable housing developers.
Since it started in 1990, Greater Miami Neighborhood has developed more than 6,000 affordable units, but since it began winding down its business last spring, it has transferred or made plans to transfer away all of them, said Helen Dunlap, a Chicago-based consultant the nonprofit hired for the job. It also transferred loans from the Florida Housing Finance Corp. for the 18 Miami properties and two more in Jacksonville.
At one point in 2007, Miami Neighborhood had more than 100 employees, but now it has only a few consultants. For its fiscal year ended June 30, 2006, Greater Miami Neighborhood lost $683,379 on revenue of $3.3 million. It had $44.4 million in assets and $19.6 million in liabilities.
Once the properties are transferred, the nonprofit will likely file for bankruptcy, Dunlap said.
For most of these properties, the debt load is equal to or greater than the value of the property, so a sale is usually an assumption of liabilities on behalf of the buyer, Dunlap said. The buyer, often an affordable housing developer, looks to refinance the private debt and assume the government debt.
"Our goal is to have soft landings for these properties," Dunlap said.
Greater Miami Neighborhood started many affordable projects after Hurricane Andrew in 1992, but ran into trouble because its rent was capped to occupants' income levels, the government didn't increase funding and its expenses -- especially insurance -- grew.
"The ability to afford being an owner becomes more difficult over time," Dunlap said. "It is regretful and it's what happens when the government isn't fully resourced to produce a product that there is demand for, but there isn't a taxpayer willingness to pay for."
Karen Blomquist, spokeswoman for Boston-based Preservation of Affordable Housing, said her nonprofit will do financial restructuring to keep the five projects it is acquiring from Greater Miami Neighborhood affordable. These properties are:
* Cutler Manor, 220 units, at 10875 S.W. 216th St.
* Island Place, 199 units, at 1551 N.E. 167th St.
* Cutler Glen, 75 units, at 11100 S.W. 196th St.
* Cutler Meadows, 150 units, at 11240 S.W. 196th St.
* New Horizons Apartments, 100 units at 690 N.W. 60th St.
The other properties will be transferred to Colombia, Md.-based Enterprise Community Partners. The nonprofit also took full control of two joint ventures it had with Greater Miami Neighborhood. These properties are:
* Lakeview Apartments, 40 units, at 11505 N.W. 22nd Ave.
* Park City Apartments, 180 units, at 845 N.W. 155th Lane
* Florida City Apartments, 123 units, at 897 N.W. Lucy St.
* M&M Maison II, 21 units, at 1621 N.W. 61st St.
* Tiffany Square Apartments, 56 units, at 2020 N.W. 169th St.
* Leisure Villas Apartments, 30 units, at 28701 S.W. 153rd Ave.
* Richmond Pines Apartments, 80 units, at 14700 Booker T. Washington Blvd.
* Central City Apartments, 35 units, at 701 N.W. 10th St.
* Tequesta Knoll, 100 units, at 1629 N.W. 14th St.
* Inn Transition, 56 units, at 11900 S.W. 202nd St.
* Calusa Cove Apartments, 144 units, at 7900-8000 S.W. 210th St.
* Villages of Naranja, 259 units, at 13800 S.W. 268th St.
* Hidden Grove, 222 units, at 13815 S.W. 271st Terrace