The Metropolitan Consortium of Community Developers submitted a list of suggestions and concerns in several areas including; hard costs, soft costs, design, scale, pacing, fee, regulation, communication and efficiency.
- Examine stringent municipal design and parking requirements.
- Create flexibility from funders when it is found that certain green requirements are onerous to the development of the property.
- Save on construction costs by moving faster to the closing table after MHFA awards are announced.
- MHFA should hold regular developer and construction forums to discuss changes that MHFA is considering.
- Implement an off-the-shelf Bond-Purchase program for 80% market/20% affordable deals.
- Allow developers to use awarded funds for pre-development or acquisition cost upon commitment rather that leaving costly loans in place.
- Create a predevelopment load pool with low or no interest rate.
- Create a 40-year mortgage product that takes 90 days or less to review and approve. Reinstate the 40-year LMIR loan product, and consider below market interest rates for developments serving 30% AMI or below.
- Identify and pursue financial resources beyond the limited local funding pools. For instance, for Bond / 4% deals, consider allowing the maximum allowed IRS developer fee, and use excess basis and equity generated as additional capital in the deal.
- Work to create a more effective underwriting process and increase capacity.
Policy/Regulatory, Process, Finance, Hard Costs, Soft Costs
Download the Metropolitan Consortium of Community Developers submission