Greystone Affordable Development Closes $53 Million Affordable Housing Redevelopment in Kentucky
Greystone Affordable Development, a national affordable housing developer, recently closed a $53 million state-wide transaction that refinanced and renovates 364 affordable housing units in rural Kentucky. Owned and operated by Winterwood, Inc. or its affiliates, the units are spread across 15 properties in 12 different counties. The recapitalization and rehab are made possible through the public-private partnerships with USDA and Kentucky Housing Corporation to ensure long-term affordability for the residents.
Greystone’s affordable housing preservation group worked closely with USDA Rural Development’s Production and Preservation Division, as well as the Kentucky Housing Corporation to coordinate and secure the financing needed to acquire and rehabilitate this at-risk, aging but much-needed affordable housing. The financing sources include:
- Tax-Exempt Bonds – Single issuance of $16.8 million in multifamily private activity tax-exempt bonds by Kentucky Housing Corporation;
- Senior Debt – $4.5 million in long-term senior debt comprised of USDA 538 Guaranteed Loans, provided by Greystone Servicing Company LLC;
- RHS 515 Debt – $11.3 million of new USDA Section 515, along with another $8.3 million of assumed and subordinated USDA Section 515 long-term debt. The Section 515 program is a direct loan program designed to provide subsidized loans to owners of affordable housing in rural markets;
- Housing Tax Credits – Purchase and syndication of 4% Housing Credits by Boston Financial Investment Management, generating $10.6 million in capital contributions;
- HOME – $1 million in HOME loans provided by Kentucky Housing Corporation;
- Other – Other miscellaneous sources totaling approximately $500,000.
With the financing in place, the rehabilitation plan includes a fast-paced 14-month construction process, during which no residents will be permanently displaced. Substantial renovations, averaging $38,000 per unit, will include both interior and exterior improvements and modernization.
“Greystone Affordable Development has served as a long-standing and trusted partner in this redevelopment process; and now that we are embarking on the renovations, we are thrilled to finally see those efforts be put to work at the properties,” said Zach Worsham, Vice President, Winterwood, Inc. He added “We want to share a sincere thank you not only for being great partners, but for the work of deep compassion you have in improving the homes and communities of our residents.”
“Working through a pandemic on such a critical transaction really proved how important financing from USDA truly is to the preservation of rural affordable housing,” said Will Eckstein, Senior Vice President, Greystone Affordable Development. “Without these efforts, already-sparse housing would disappear from communities that need it the most. We thank Winterwood and all of our partners for their dedication, commitment and perseverance through these difficult times.”
“Kentucky’s affordable housing stock is precious, and we must preserve every unit that we can,” added Tracy Thurston, Managing Director, Multifamily Programs, Kentucky Housing Corporation. “We are grateful for the cooperation and efforts orchestrated by Greystone and their expertise in these complex re-development challenges.”