By Adelina Osan, Associate Editor
New Orleans—Bellwether Enterprise Real Estate Capital recently closed a $31 million construction loan to rebuild Village of Versailles, an affordable and workforce housing community in New Orleans. Bellwether Enterprise arranged the financing through the U.S. Department of Housing and Urban Development’s FHA loan program to restore some of the city’s affordable housing supply that was lost during Hurricane Katrina.
Village of Versailles housed two 200-unit, HUD-insured apartment buildings built in the 1970s. In 2005, flooding and winds from Hurricane Katrina decimated the area, leaving the site to remain vacant—until now. Scheduled for completion by the end of 2017, the community will consist of 50 residential, two-story buildings containing 400 units, as well as two one-story community buildings and a leasing office.
“As devastating floods continue to plague Louisiana, helping displaced families rebuild and get their lives back on track via access to stable, resilient housing is vital to our mission. 11 years after Hurricane Katrina, the Village of Versailles is finally experiencing a transformation from a practically vacant complex to what will be a thriving and vibrant community,” said Jon Killough, senior vice president in Bellwether Enterprise’s Alabama office, in prepared remarks. “The Village of Versailles revitalization required a very complicated financing structure, but our sponsor (Mirus) navigated it exceptionally well thanks to their commitment to putting families in need of affordable housing at the forefront of their work.”
Killough, the loan’s originator, arranged a HUD 221(d)(4) new construction financing loan for Mirus New Orleans LLC, which features interest-only payments for the first 22 months, with a 40-year term and amortization following. The financing of the project also includes the issuance of short-term tax-exempt bonds, four percent Low Income Housing Tax Credits purchased by City Real Estate Advisors, and HOME Funds provided by the Louisiana Housing Corp.
“Our loan for the Village of Versailles is an important transaction for Bellwether Enterprise as it provided a unique opportunity to work with Mirus on the continued revitalization of the New Orleans East area and to restore much needed affordability to the community,” said Phil Melton, executive vice president & director of Bellwether Enterprise’s affordable housing group.
Image courtesy of Bellwether Enterprise