Twin Cities Affordable Housing Portfolio Sells for $77M

Investors Aeon, the NOAH Impact Fund and Enterprise Community Investment purchased the 10 properties. The apartments will continue to welcome low-income renters.

48-unit Masada Manor in Bloomington, Minn.
48-unit Masada Manor in Bloomington, Minn.

Local nonprofit developer Aeon, the Naturally Occurring Affordable Housing (NOAH) Impact Fund from the Greater Minnesota Housing Fund (GMHF) and Enterprise Community Investment completed the acquisition of a 768-unit affordable housing portfolio in the Twin Cities for $77 million. The 10 properties are located in Minnesota’s Bloomington, Brooklyn Center, New Hope and St. Paul areas. Local firm Steven Scott Management will manage the 10 properties.

Bellwether Enterprise Real Estate Capital, BMO Harris Bank, the Bloomington Housing and Redevelopment Authority and the St. Paul Housing and Redevelopment Authority were also partners in this deal that will preserve the character of the apartment homes. This is the largest transaction in Aeon’s 31-year existence.

“This purchase with GMHF, Enterprise and our other partners, is a model for how communities can work together to preserve affordable homes. Saving our existing stock of affordable homes is as important—if not more urgent—than developing new ones,” said Aeon President & CEO Alan Arthur, in prepared remarks.

First deal for NOAH Fund

This is the first project funded by GMHF’s recently formed NOAH Impact Fund, a $25 million equity fund aimed at preserving naturally occurring affordable housing. The social impact capital was raised from Minnesota foundations, community banks as well as state and local government. It was officially launched in June.

NOAH Fund Manager Rachel Robinson and GMHF President & CEO Warren Hanson
NOAH Fund Manager Rachel Robinson and GMHF President & CEO Warren Hanson

“The NOAH Impact Fund is our response to the crisis of the loss of affordable housing in the Twin Cities metro,” Rachel Robinson, manager of NOAH Impact Fund, told Multi-Housing News.

The deal was also financed by Enterprise Community Investment, which provided a combined $12.7 million in equity with its investment partner, BMO Harris. The largest part of the necessary capital was provided by Bellwether Enterprise, which secured $60 million in Freddie Mac loans.

According to a recent report by the Minnesota Housing Partnership (MHP), only 10 percent of new units built in the Twin Cities region will be available for low-income renters. Last year, roughly 1,000 affordable units were completed in Minnesota, MHP data revealed.

Images courtesy of NOAH Impact Fund