NorthMarq Capital collaborates with Freddie Mac on new Affordable Housing Financing option

MINNEAPOLIS (December 6, 2017) - NorthMarq Capital collaborated this year with Freddie Mac to close the first two loans as part of a new execution designed to preserve unsubsidized affordable housing properties. The loans for two Minnesota multifamily properties have now become a model for financing options across the country. The Naturally Occurring Affordable Housing (NOAH) Preservation Loan program completed the inaugural loans on behalf of CommonBond, the Midwest’s largest nonprofit provider of affordable housing with services, owning more than 6,000 affordable rental apartments and townhomes throughout 52 cities in Minnesota, Wisconsin and Iowa. CommonBond acquired Pine Point, a 68-unit apartment building in Coon Rapids, Minn., and Rainbow Plaza, a 108-unit building in Anoka, Minn., as part of the non-profit’s initiative to preserve affordability without government subsidy. For Rainbow Plaza, impact investor Mercy Housing, Inc., leveraged grant funds from private foundations to buy the Impact Gap Loan. Impact investors look to make a measurable social or environmental impact alongside a financial return. Freddie Mac’s NOAH Preservation Loans facilitate the preservation, improvement and long-term affordability of naturally occurring affordable housing (NOAH). This loan can be paired with the new Impact Gap Financing, which matches impact investors with mission-focused borrowers. “NOAH properties are easily lost to deterioration, abandonment and gentrification,” said David Leopold, Freddie Mac Multifamily vice president of Targeted Affordable Sales & Investments. “Our new execution seeks to combat that by building the infrastructure necessary to match impact investors with mission-focused borrowers to ensure these properties are acquired, preserved and remain affordable.” “The sale and the ability to retain these units as affordable offerings wouldn’t have been possible if it wasn’t for the forward-thinking and generosity of the previous owners,” said Deidre Schmidt, CEO of CommonBond. “Marilyn and Jack Washburn, and their daughter, Rhonda Charboneau, the original owners and managers of the buildings since the 1980s, approached us directly to consider the purchase and agreed to a below-market price allowing us to retain affordable rents.” NorthMarq Capital’s team include Mike Padilla, vice president/producer in the Minneapolis office, and Paul Cairns, senior vice president and Freddie Mac program leader for NorthMarq Capital, worked through financing options to best fit CommonBond’s goals. “The key to success with affordable housing projects is to have a strong, committed team – from the investor, the financing partner and the sellers,” said Padilla. “We are proud to partner with Freddie Mac on the implementation of this important new product.” “NorthMarq Capital is thankful for our partnership with Freddie Mac in developing these new initiatives for nonprofits focused on preserving NOAH. We were pleased to deliver the first execution to CommonBond with aggressive loan terms and substantial flexibility from Freddie Mac to meet their needs,” said Cairns. Across the nation, affordable housing is scarce—and getting even harder to find. A quarter of all renters are “severely rent burdened”, spending more than half their income on rent, according to Harvard’s Joint Center for Housing Studies.  
A checkbox that looks like a button used to make the rest of the form visible.
Let us know what emails you want to receive