Housing Authority of Elgin secures public/private financing for $33.5 million affordable housing project for seniors under Rental Assistance Demonstration
Our client’s need
The Housing Authority of Elgin, Illinois (HAE), a public housing agency, manages a portfolio of nine family and elderly developments within the city. The 255-unit portfolio includes the aging 11-story Central Park Tower (CPT) apartment building which was in need of capital improvements in excess of $30 million—far beyond their annual capital appropriation from the US Department of Housing and Urban Development (HUD).
To overcome the financial challenge of the project, HAE engaged C. Ray Baker & Associates, Inc. (CRB) to assist in the preparation and submission of a successful competitive application to convert CPT to a Section 8 funding platform under HUD’s Rental Assistance Demonstration (RAD). The authority and its Board of Commissioners knew that the success of the project hinged upon their ability to assemble a deeply experienced development team with not-for-profit specialization and a shared commitment to community stewardship.
Baker Tilly solution
CRB helped the authority establish the criteria for development team members, review candidates, negotiate contracts, and establish performance benchmarks. The assembled team then worked with the authority to lay out a vision for redeveloping the existing elderly high-rise building. The team needed to:
- Build consensus among project stakeholders
- Establish ownership structure
- Determine project delivery method
- Establish the project objectives
- Frame the project vision
- Quantify market demand
- Finalize the land, building, and infrastructure program
- Complete master plan and architectural design
- Formulate development budget and project schedule
- Finalize development phasing plan
- Prepare the public/private partnership financing structure
Financing
In deciding the financial advisor for the project, CRB chose Baker Tilly for their deep knowledge of various sources, experience serving not-for-profits, and demonstrated ability to work with multifaceted projects. The magnitude and intricacy of the project’s rehabilitation and new construction demanded a very complex structure of layered financing from many public and private sources, each governed by various regulatory requirements and constraints. Together, CRB and Baker Tilly helped the authority source and secure a total of $33 million in funding to move the project forward.
