Case Study
Affordable Housing/Supportive Housing Development with Bond Financing, Tax Credits and a NY Office of Mental Health grant
Hughes Houses, a project of Urban Pathways, Inc., located in the South Bronx, consists of 55 studio units of affordable housing with a resident’s lounge, a central kitchen area and a computer lab for low income individuals with serious and persistent mental illnesses. When the Project construction is completed, Urban Pathways will be providing on-site supportive services funded in part through the New York City and State NY/NYIII program plan.
As Urban Pathway’s legal counsel, ShermanLaw negotiated and closed on mixed-financing for the project, including the following sources:
- NYS Housing Finance Authority (HFA) Tax Exempt Bond financing
- Federal Low Income Housing Tax Credits
- $11 million NYS Office of Mental Health (OMH) acquisition and construction financing
- Federal Home Loan Bank Affordable Housing Program (AHP) award
ShermanLaw created the legal structure necessary to maximize financing. The firm worked closely with Urban Pathways to review the terms of the tax credit financing and identify negotiable provisions necessary to protect Urban Pathways and the project. ShermanLaw negotiated terms, performed due diligence required to determine the compatibility of new financing with obligations under existing loans, and obtained necessary consents. Further, ShermanLaw secured a quick draw letter of credit, which was a condition of the tax-exempt bond financing, and the firm developed a loan agreement which clarified the revenue streams for development and operation of the Project, including the operation financing from OMH.
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