Freddie Mac, NEF Launch New LIHTC Fund

The fund’s first three investments in Houston and Los Angeles total more than $60 million and come several months after Freddie Mac re-entered the LIHTC market.
David Leopold, Vice President of Targeted Affordable Sales & Investments at Freddie Mac

Freddie Mac, which re-entered the Low-Income Housing Tax Credit market in late 2018, closed its fifth LIHTC fund and its first with Chicago-based nonprofit National Equity Fund (NEF). The first three investments, totaling $61.1 million, will help create housing for displaced and homeless individuals and families in Houston and Los Angeles.

David Leopold, vice president of Targeted Affordable Sales & Investments at Freddie Mac, said the GSE chose to develop the proprietary fund with NEF because of its deep expertise with the LIHTC program, its commitment to communities in need and its ability to support Freddie Mac’s mission of delivering liquidity and stability to underserved markets.

The investments are:

  • $15 million LIHTC equity investment in Houston’s New Hope Housing’s Dale Carnegie development that will provide high-quality housing and supportive services to 170 individuals and families displaced by Hurricane Harvey.
  • $19.6 million LIHTC equity investment in Skid Row Housing Trust’s Flor 401 Lofts development in Los Angeles. The development will serve nearly 100 homeless veterans and special needs individuals and provide housing and supportive services.
  • $26.5 million LIHTC equity investment in Hollywood Community Housing’s Florence Mills Apartments to provide supportive housing in South Los Angeles, an area with a very high homeless rate. Thirteen of the 74 units will be designated for homeless veterans.

“The investments we have made through the fund thus far are making a home possible for those displaced by Hurricane Harvey and individuals experiencing homelessness in some of the most housing-challenged communities in the country,” Leopold said in a prepared statement.

Reena Bramblett, NEFs senior vice president of equity placement, called the Freddie Mac investments “life-changing opportunities for the individuals and families that call these LIHTC properties home.”

“We believe that extraordinary things can happen with great partners, and NEF’s partnership with Freddie Mac demonstrates that motto to be true,” Bramblett said in prepared remarks.

Affordable Housing Developments

NEF is a leading syndicator of LIHTC and an affiliate of the Local Initiatives Support Corp. The organization, active for more than 30 years, has invested $15.3 billion in 2,687 LIHTC developments through partnerships, creating more than 176,804 affordable homes for low-income families and individuals.

In October, Freddie Mac re-entered the housing credit market when it closed its first LIHTC fund and made its first equity investment from the fund with Enterprise Community Investments, Inc. The fund will provide as much as $100 million in targeted affordable housing investments. One of the first deals was an $8.2 million investment in Wintergreen West, which provided 40 apartments for low-income residents in Summit County, Colo., as part of a large, mixed-income development.

Last month, NEF was part of a team that helped provide financing to an $83.9 million project in Portland, Ore.—a 203-unit, 13-story affordable housing building developed by Bridge Housing. Other parties involved in the project’s financing were the Portland Housing Bureau, Oregon Housing and Community Services, Prosper Portland, Home Forward, the U.S. Department of Housing and Urban Development (HUD), KeyBank Community Development Lending and Barings Multifamily Capital.

Image courtesy of Freddie Mac