Minnesota Affordable Property Gets $42M Refi
- Oct 14, 2020
Twin Cities nonprofit developer and operator Aeon, along with Minnesota Housing and affordable housing investor Community Development Trust (CDT) has arranged a $42.5 million refinancing of Seasons Park Apartments in the Minneapolis suburb Richfield, Minn.
The three-story property, constructed in 1965, features 422 one- and two-bedroom units. It offers long-term housing to families earning 60 percent or less of Area Median Income
The financing plan from Minnesota Housing consists of a 35-year first mortgage of $34.5 million from the Low to Moderate Income Rental program, along with $8 million in subordinate financing from the agency’s Flexible Financing for Capital Costs program.
The plan helps preserve long-term affordability for more than 1,200 residents of Seasons Park Apartments. The financing comes at a time when affordable properties increasingly are being purchased by developers intent on transforming them into market-rate housing.
Aeon and CDT partnered to acquire Seasons Park in September 2017, at a time when the displacement of hundreds of families was an imminent possibility. The property at that time was being eyed for acquisition by market-rate investors.
“Despite the prepayment penalty and COVID-related market uncertainty, the determination of Minnesota Housing and CDT to maximize available funding for Seasons Park was instrumental in helping Aeon preserve long-term affordability of these homes for 422 families,” Sarah Harris, Aeon executive vice president, strategy, partnerships and production, told Multi-Housing News.
Addressing years of deferred maintenance and renovations, Seasons Park is currently undergoing improvements that began in August and are slated to be completed in three years. Among the renovations underway are the addition of new roofs, landscaping, laundry room updates and enhancements to apartments before new residents take occupancy. Work also includes renovations to the Seasons Park playground area, a popular spot for the hundreds of children in the apartment community.
Located directly south of Minneapolis along Interstate 35W, Richfield provides easy access to downtown Minneapolis and Minneapolis-St. Paul International Airport, as well as to transit, shopping and higher education. Seasons Park Apartments residents are close to two major shopping malls, the Mall of America in neighboring Bloomington, and the nation’s first enclosed mall, Southdale Center, in Edina.
Three months ago, Aeon landed a loan for an affordable apartment community in Bloomington.