Insurance endorsement provided by FHA supports substantial rehabilitation of 32 units serving 55+ residents at 30%, 45%, 50%, and 60% of the area median income.
The Federal Housing Administration (FHA) announced on May 13, that it has closed on a $8.2 million mortgage insured under FHA’s 221(d)(4) Substantial Rehabilitation program for Gloria Drive Apartments in Sacramento, CA. The developer is utilizing new 9% Low Income Housing Tax Credits as a source of funding. The mortgage will be used to rehabilitate this age-restricted project that includes 32 rental apartments restricted to senior households aged 55+ at 30%, 45%, 50% and 60% of Area Median Income. The FHA Regulatory Agreement, in combination with the Land Use Restrictive Agreement (LURA), ensures the affordability of the property for 55 years.
Gloria Drive Apartments was built in 1982 and is an existing senior 32-unit garden style apartment complex with units ranging from 592 to 892 square feet. The project consists of seven one-story apartment buildings containing one and two-bedroom units, and a one-story community building. Unit amenities include carpet/vinyl flooring, blinds, air conditioning and heating, garbage disposal, ceiling fan, coat closet, and patios/balconies. The units also offer an electric range and refrigerator.
The mortgage was originated by ORIX Real Estate Capital LLC (the Lender), Dawson Holdings, Inc. (the Sponsor/Developer), Community Resident Services, Inc. (the Managing General Partner), and Sackett Corporation (the Property Manager). The Sponsor proposes to carry out approximately $6,424,732 in rehabilitation activities or $200,773 per unit. The entire property’s exterior and interiors will receive repairs and improvements to improve the physical condition.
About the Office of Multifamily Housing
FHA’s Office of Multifamily Housing plays an important role in the construction, substantial rehabilitation and refinance of market rate and affordable housing through the issuance of FHA mortgage insurance. These insurance programs provide stability, liquidity, and affordability to the multifamily housing market by providing credit during countercyclical times and in small markets. Fiscal year-to-date, the Office has insured 11,225 mortgages for 1.4 million homes with a total unpaid principal balance of $114 billion.
In fiscal year 2021, the Office of Multifamily Housing achieved record-breaking volume of $29.5 billion in initial endorsements for mortgage insurance. View quarterly and historical data on FHA Multifamily volume here.
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