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LIHTC Year 15 Work Group report information can be found here.
The Risk Mitigation Pool is up and running, please click here to link to the RMP information page.
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The Community Development Network’s Property and Asset Management Working Group (PAMWG) presented "The State of the Industry in Asset Management: Positioning Our Portfolios for Growth and Sustainability" on Oct. 18th, 2007 at the CDN Public Forum. Molly Rogers, HDC’s Asset Management Program Manager, is the facilitator of PAMWG and coordinated this community-wide event. For more information, you can contact her at 503-335-3668 x117.
To view a copy of this presentation, please click here
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Robin Boyce and Molly Rogers of HDC presented at Washington State’s Housing Conference in Spokane on Sept. 9, 2007 as co-presenters with Lisa Vatske, Managing Director of the Washington State’s Housing Trust Fund.
Managing Our Portfolios for Long Term Viability – Learning from Our Mistakes
Moderator: Lisa Vatske, Wa. State Dept of Community, Trade and Economic Development
Presenters: Robin Boyce, Housing Development Center
Molly Rogers, Housing Development Center
The Housing Trust Fund, in collaboration with Impact Capital and the Housing Development Center in Portland, Oregon, has been providing technical assistance resources to organizations to help them address managing their affordable housing portfolios. Join us at this interactive session and learn how to manage your portfolio for long-term viability. This workshop will include a discussion and presentation of a “model” workout, policy and underwriting implications, and lessons learned from work being done across the state.
You can view the presentation by downloading this Pdf.
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In recent years, the Housing Development Center (“HDC”)
has emerged as leader in developing asset management capacity within
the Portland Area nonprofit community. Our mission is to support
the efforts of other nonprofits to successfully develop and own
affordable housing. HDC has helped the nonprofit affordable housing
industry redefine success to consist of not only the development
of units, but also the long term ownership of those units. The goals
of successful ownership include:
Successful residents (access to affordable housing and appropriate
services)
Viable and well-managed housing
Strong and competent owner organizations
Asset management is a critical component to achieving these goals.
However, asset management is also a relatively new arena for most
affordable housing developers. Many nonprofit developers in the
Portland area recognize that they need assistance to grow their
asset management capacity. HDC’s asset management efforts
provide that missing expertise. Our goal is to help our community
assure a long-term future for housing for populations that cannot
be served adequately in the private market. HDC uses three primary
channels to promote the growth of asset management expertise in
the nonprofit affordable housing community:
HDC Asset Management Program Recent Accomplishments
PROJECT RESTRUCTURES
The Housing Development Center began its work in asset management
in response to lender and owner requests for assistance with non-performing
properties. After work on more than 20 of these properties, HDC
has developed a methodology for evaluating the properties that starts
by determining the contributing factors and then identifies actions
needed to bring these properties back into viable operations. Even
with this work, the outcomes of restructures are limited by the
age, unit mix, location, original underwriting restrictions, or
other characteristics of a particular property. Success cannot be
measured by comparison to standards currently used in new developments,
but rather through financial stability, strong occupancy, and adequate
physical conditions which meet life safety standards.
HDC has completed or is the process of completing restructures
on over 747 units, for 8 organizations.
HDC has a history of successful financing and construction management,
and is able to utilize this expertise on the more complex refinances
and rehabilitation of occupied properties. HDC’s work has
included restructuring tax credit investments, private loans and
public financing. We have worked with private lenders, investors,
Oregon Housing and Community Development, the Portland Development
Commission and Washington County.
DIRECT TECHNICAL ASSISTANCE TO NONPROFIT OWNERS
Through the restructures, HDC recognized the need to provide asset
management technical assistance to nonprofit owners. Both nonprofit
owners and private lenders and investors report that they spend
the bulk of their asset management time on a few troubled properties.
Prevention and early intervention on non-performing properties are
the only way to assure long time cost efficiencies within the nonprofit
community.
Since 2002, HDC has worked one-on-one with eight nonprofits on
asset management system development and staff and board training.
This work has focused primarily on three areas:
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Compliance work: Compiled document
binders for more than 30 projects, and prepared compliance
charts describing funder requirements, including HOME regulations,
LIHTC requirements, rent and income restrictions. These charts
serve as a guide for asset managers and are also being attached
as contractual requirements to property management agreements;
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Financial Oversight: Assisted organizations to establish and
review annual budgets for projects, prepared rent increase charts,
created a financial performance model for tracking critical
financial indicators, and provided training on monitoring financial
performance; |
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Organizational Systems: Developed asset management plan model
in collaboration with Community Development Law Center and prepared
organizational specific plans for several entities. Assisted
in development of job descriptions and participated in hiring
asset manager. Developed an RFP format and assisted CDCs with
out-sourcing or changing property management firms. Assisted
in evaluating viability to bring property management in-house
and helped CDCs establish board reporting formats;
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Long Term Project Planning: Assisted in development of completed
replacement reserve analyses, financial projections to evaluate
trends, occupancy and market reviews to assess market viability,
rent increase viability and actual tenant profiles, assisted
organizations to evaluate vacancy and turnover issues. |
INDUSTRY SUPPORT
In recent years, Portland area nonprofit and public lenders have
seen an emergence of the nonprofit asset management profession that
is similar to the growth of the industry’s development capacity
in the mid-nineties. This growth reflects both proactive and reactive
measures taken to respond to several key factors in our industry:
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The increase in the size of the
nonprofit owned portfolio: The Community Development Network
membership portfolio now exceeds 5,700 units and is continuing
to grow by over 500 units a year. Regionally, CDCs in Clark
County, Washington and Clackamas County bring the unit count
to almost 7,000 units.
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The aging of the nonprofit portfolio: Much of the nonprofit
portfolio is now between five and ten years old. With this aging,
there are increased capital needs, expiring funding (Section
8’s, LIHTC), and longer periods in which initial underwriting
assumptions no longer meet changing market, expense or other
conditions. |
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Failures in systems: The industry, including funders, have
only recently begun to allocate resources toward both systems
and staffing to address compliance monitoring, oversight of
property management, planning and other asset management functions.
Without this staffing and these systems, the “weakest
links,” (the most vulnerable projects, systems and organizations)
have experienced failures. |
The Housing Development Center has been active in several “industry
wide” initiatives to help the industry recognize and address
these issues:
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