Boston Financial, the largest and most established syndicator of U.S. Low-Income Housing Tax Credits (“LIHTC”), has announced the closing of Boston Financial Institutional Tax Credits 59 Limited Partnership (“ITC 59”), a $164 million LIHTC fund.
ITC 59 secured commitments from seven institutional investors, including a mix of regional and national banks and insurance companies, allowing it to deploy capital with 14 affordable housing developers – over 40% of whom are nonprofits. The fund will provide capital for both new construction and preservation of 22 affordable housing properties in 18 communities across 10 states: California, Illinois, Kentucky, Louisiana, Massachusetts, Montana, Nevada, North Carolina, Ohio, and Tennessee.
“Funding and building affordable housing in the current economy is challenging, with developers facing higher interest rates and expense structures and investors struggling to generate satisfactory returns relative to increased cost of capital amid disruption in the capital markets,” said Todd D. Jones, Head of Tax Credit Equity Production at Boston Financial. “Attracting deals and capital for a $164 million fund in this market is a remarkable achievement that we are very proud of at Boston Financial.”
ITC 59 is expected to create 1,980 new jobs, bringing an estimated $223 million in wages and business income to the surrounding communities, as well as $77 million in tax revenue. Nearly 70% of the properties will bring affordable homes to minority communities, and several properties will have units designated for seniors, persons with physical or mental disabilities, as well as formerly unhoused people.
“We are in the midst of an affordable housing crisis in this country, with more than 20 million Americans spending over 30% of their income on rent, and hundreds of thousands more who are fully homeless,” added Sarah Laubinger, Chief Production Officer at Boston Financial. “I am honored to be part of a team that works hand-in-hand with investors and developers to create desperately needed inclusive, safe, and affordable housing nationally.”
ITC 59 includes communities like Vanderbilt Apartments, a 123-home senior property in Asheville, North Carolina, that was originally constructed in 1924 as a hotel and then converted to affordable housing in 1969.
Boston Financial is working with National Church Residences, a national nonprofit affordable housing developer, on the community. In addition to its main purpose as affordable housing for seniors, 13 apartments will be dedicated to persons with disabilities or struggling with homelessness. Vanderbilt Apartments features expansive supportive services and a resident services coordinator who helps residents with access to the supportive and medical services they need to remain living independently in their own homes.
Since the beginning of the LIHTC program in 1986, Boston Financial has worked with over 200 investors to preserve or build over 360,000 affordable homes. ITC 59 is Boston Financial’s second LIHTC multi-investor fund closing of this calendar year.