Loan Closings

CARMEL, Ind.  – Leading financial services provider Merchants Capital announced today it has arranged $13 million in debt financing and $7.2 million in equity financing to support the renovation and redevelopment of Adcock Joyner Apartments in Oakland, California. The mixed-use property is a historic development, originally constructed in 1915 as a hotel and converted into affordable housing in the early 1990s. Situated at 532 16th St. in the heart of downtown Oakland, Adcock Joyner provides housing for residents earning no greater than 50% or 60% of the area median income (AMI). The property features 25 studio and 25 one-bedroom apartments with excellent walkability to Oakland’s public transportation and major thoroughfares. The first floor of the mixed-used development features more than 2,500 square feet of commercial space occupied by a local nonprofit that helps homeless, poor and disabled individuals achieve health and self-sufficiency. To finance the renovation, Merchants Capital provided more than $20 million in total debt and equity financing, which will fully fund the project through the 4% Low-Income Housing Tax Credit (LIHTC) program. Following completion of the renovation, the property will operate under a new Housing Assistance Payments (HAP) contract covering 100% of the revenue-generating units, ensuring the property will remain affordable for residents in the years to come. “Right now, the need for quality, affordable housing is exponential in the U.S. but especially in the state of California,” said Eddie Dietrick, Vice President at Merchants Capital. “With our full-service lending platform, we are able to better serve the needs of our clients and support their work in revitalizing affordable housing properties across the country. We are grateful to have partnered on this project and look forward to expanding Merchants’ presence along the West Coast.” “The California housing market is truly unlike any other in the country, and we are thrilled to showcase Merchants’ commitment to the area by serving as the financier for this important redevelopment project,” said Linda Hill, Executive Vice President of Tax Credit Equity at Merchants Capital. “We are working to expand our presence nationally and having the opportunity to partner on such a significant California property is a step in the right direction for our company.” Significant renovations will be made in each residential unit, including upgrades to all kitchen surfaces and appliances, all bathroom surfaces and fixtures, plumbing, flooring, electrical updates and more. Exterior renovations include repairs to the building’s fire escape, new roofing, new HVAC units, elevator upgrades, enhanced security systems and more. The first-floor commercial space will be reconfigured and renovated, with new kitchen cabinets, fixtures and flooring among others. “We are excited about the project and our partnership with Merchants Capital and Progressive Affordable Development,” said James Hill, President of Adcock Joyner Preservation. “This renovation helps us continue our long-term objective of providing stable affordable housing in the downtown Oakland sector. We value our relationship with Merchants Capital and are most grateful for the expertise and support provided while we bring our vision into reality.” Renovation to the property began in November 2021 and is expected to be completed by January 2023. To learn more about Merchants Capital and its services, visit www.merchantscapital.com or find Merchants Capital on Facebook, Twitter, LinkedIn and Instagram.

CHICAGO – The Chicago office of leading financial services provider Merchants Capital recently secured more than $110 million in total financing for Parkside 8 and Parkside 10, two mixed-use, workforce housing developments located in Ward 7 in Washington, D.C. Upon completion, Parkside 8 and 10 will feature 230 total residential units and approximately 14,000 square feet of commercial retail space. The projects are being co-developed by City Interests Development Partners and Ravinia Capital Group and they closed on the joint venture (JV) equity with the Opportunity Zone strategy managed by Bridge Investment Group. The projects will address the need for workforce housing in an expensive market, offering rental housing for low- and moderate-income households. Parkside 8 and 10 are part of a larger, 3.1-million-square-foot and master-planned development known as Parkside. The aggregate Parkside mixed-use development will include between 1,500 and 2,000 residential units, up to 50,000 square feet of retail space, 860,000 square feet of office space, a one-acre park and a new pedestrian bridge that crosses over Kenilworth Avenue and I-295 linking the Eastland Gardens, Kenilworth and Parkside neighborhoods with the Minnesota Avenue Metrorail Station. Additionally, Parkside offers four neighborhood educational institutions and a primary care clinic that serves both the developments’ residents and adjacent neighborhoods. “Workforce housing is such an important component of a city’s housing plan as it supports employment populations that are critical in making the city operate. We need teachers, fire fighters, members of the police force and government employees living and working in our communities," said Peter J. Farrell, Managing Partner at City Interests Development Partners, LLC. "Adding Parkside 8 and 10 to our mixed income housing footprint is another step in the evolution of Parkside as a live, work, play mixed-use development. Thank you to the Merchant Capital team for a job well done.” “We are delighted with our ongoing partnership with City Interests in providing workforce housing at Parkside," said Jim Solomon, Managing Principal of Ravinia Capital Group. "Parkside 8 and 10 is part of Ravinia’s ongoing commitment to the Parkside community as well as the city of Washington, DC. We feel that it is critically important to provide housing that’s so much in demand. Thank you, Merchants Capital, for being part of our team.” Parkside 8 and 10 will create workforce housing without the need for federal tax credit subsidies typically required for affordable developments. Within the new properties, select units will be reserved for residents earning between 80% and 120% of area median income (AMI). The new developments are located within the Mayfair/Parkside Opportunity Zone which has seen significant investment through the opportunity zone structure. To learn more about Merchants Capital and its services, visit www.merchantscapital.com or find Merchants Capital on Facebook, Twitter, LinkedIn and Instagram. To finance the properties, Merchants Capital secured $56 million of construction loans provided by Merchants Bank of Indiana and $59 million in permanent financing through Freddie Mac Non-Low-Income Housing Tax Credit (LIHTC) Forward Commitments and Freddie Mac Permanent Loans.

SAINT PAUL, Minn. – Leading financial services provider Merchants Capital recently secured more than $141 million in financing for Waterfront Station II, a multifamily, mixed-income and mixed-use property currently under construction in the Southwest neighborhood of Washington, D.C. The community is a joint venture between the for-profit Hoffman & Associates, not-for-profit affordable developer AHC Inc., City Partners and Paramount Development. Situated at 1000 4th Street SW, Waterfront Station II will bring 449 units of market-rate and affordable apartments to the area. Within the 449 total units, 313 will be available at market-rate and 136 will be affordable. Sixty-eight units will be available to households earning at 30% of the area median income (AMI) and an additional 68 will be available for households earning at 50% AMI. Made possible through an innovative financing model, the affordable housing units were financed using both 4% and 9% Low-Income Housing Tax Credits (LIHTC). Ninety-four of the total affordable units are attributed to the 4% LIHTC while 42 of the total affordable units are attributed to the 9% LIHTC. Land acquisition occurred in 2020, at which time the Waterfront Station II development team executed a 99-year ground lease with the District’s Office of the Deputy Mayor for Planning and Economic Development (DMPED). Merchants Capital financed the property with three Merchants Bank of Indiana (MBI) construction loans, totaling $141.25 million: a $123.5 million loan, a $2 million loan for the construction of the 9% LIHTC units and a $15.4 million 4% LIHTC loan required for the tax-exempt bond financing. In addition, Merchants provided financing for three separate Fannie Mae 42-month forward commitments for the permanent financing. Each forward commitment had different loan terms to meet the requirements of the market rate, the 9% LIHTC and the 4% LIHTC units, as well as the goals of the borrowers and equity investors. The full development will consist of a single, 12-story apartment building with approximately 29,000 square feet of retail, educational and commercial space on the ground level with below-grade parking. The commercial space is anchored by AppleTree Public Charter School, a DC-based early childhood education provider and a neighborhood restaurant by Good Company Doughnuts, with an additional 7,000 square feet of retail space available for lease. Designed by architect Torti Gallas Urban with interiors by interior designer Hickok Cole, the project will include more than 19,000 square feet of outdoor and interior amenity space across four floors of the building. These amenities include a coworking and communal gathering space, an expansive fitness center as well as both entertainment and hospitality lounges with dedicated meeting spaces and an intimate library. Beyond the indoor amenity spaces, Waterfront Station II will feature a second-floor courtyard, a rooftop terrace and pool, all of which will be enhanced by the work of landscape architect, Michael Vergason. Unique to Waterfront Station II is the number of private balconies and terraces that create the building façade’s signature design. In total, 147 balconies and terraces averaging 150-200 square feet give residents sweeping views of the Washington Monument, the Capitol Building and both the Potomac and Anacostia Rivers. Designed as a LEED Gold project, another exterior feature of Waterfront Station II is the inclusion of solar panels. Installed across the roof of the building, this added sustainability measure will improve the site’s overall energy efficiency. Anticipated delivery for Waterfront Station II is winter 2023. To learn more about Merchants Capital and its services, visit www.merchantscapital.com or find Merchants Capital on Facebook, Twitter, LinkedIn and Instagram.

CHICAGO – Financial services company Merchants Capital (MCC) today announces the closing of $102 million in combined debt and equity financing to support the redevelopment of Granada Homes, a historic affordable housing property located along the iconic River Walk in the heart of downtown San Antonio. Originally constructed in 1927 as the Plaza Hotel, the property currently is a mixed-use, 14-story high-rise housing underserved low- and very-low-income seniors. The financing for the project includes a $43 million Merchants Bank of Indiana (MBI) construction loan and $35 million in Merchants Capital syndicated tax credit equity. Merchants Capital also secured a forward commitment for $24 million from Fannie Mae for permanent financing with the mortgage-backed security being purchased by the AFL-CIO Housing Investment Trust (HIT). The innovative financing included one of the first executions of a new financial structure created by the HIT called a “Build to Bond,” which ensures that the project will be constructed with 100% union labor. Lee Oller “Completing this transaction in a record 60 days required the focus and attention of multiple disciplines across the Merchants product platform,” said Lee Oller, Executive Vice President of Merchants Capital’s Chicago office. “We are incredibly thankful to our developer and our long-term partnership with the AFL-CIO Housing Investment Trust, which brought the project to fruition.” Many observers feared that the building would be sold and converted into a high-end hotel or market-rate condos, displacing its elderly low-income renters. “Through this transaction, the San Antonio Building & Construction Trades Council will be able to keep the property, fully renovate it, create good union construction jobs with good pay, and make this historic building available as affordable housing for seniors for years to come,” said Chang Suh, the HIT’s CEO. “Together this allows the owners to provide strong benefits that stay in the community.” Julie Sharp "The Merchants Capital equity team was proud to provide $35 million in federal historic, state historic and federal low-income housing tax credit equity financing to revitalize this community, in a first-of-its-kind financing structure in partnership with the AFL-CIO Housing Investment Trust,” said Julie Sharp, Senior Vice President of Tax Credit Equity at Merchants Capital. “Our nimble financing structure allowed the project to close in record time, and further solidified Merchants as a single-point of execution for all aspects of debt and equity financing for affordable housing projects across the United States.” Granada Homes is comprised of 265 studio and one-bedroom units set aside for low-income elderly households. The detailed renovation plan includes upgrades to the finishes and offerings of all units, designed to specifically meet the needs of seniors. The redevelopment will also expand the affordable housing stock through the conversion of the currently under-utilized commercial space to additional affordable units. The loan will result in material improvements to the major building system and significant savings in operating costs. Community and amenity spaces will be upgraded and modernized. Financing for the property also includes a mark-up-to-market of the Section 8 Housing contract, an 8(bb) transfer of a Housing Assistance Payments (HAP) Contract and the issuance of enhanced vouchers, as well as a 100% ad-valorem tax exemption. “We are excited for the partnership with Merchants and the AFL-CIO Housing Investment Trust and look forward to enhancing and expanding affordable housing and good union jobs in San Antonio alongside our partner, San Antonio Building & Construction Trades Council,” said Victor Atkins and Pat Biernacki, the Principals of Canopy, the developer working in partnership with the local labor organization. “The Granada transaction required tremendous creativity within a tight closing time. We feel very fortunate to have found a partner in Merchants that brought the level of talent, commitment and resources to the table necessary to not only ensure transaction closing, but also the continuation of a five-decade legacy of quality, affordable senior living at Granada Homes.” Granada Trade Council Housing Inc. is a 501(c)(4) non-profit with the mission of providing rental housing to low-income elderly persons, directed by the San Antonio Building & Construction Trades Council. To learn more about Merchants Capital and its services, visit www.merchantscapital.com or find Merchants Capital on Facebook, Twitter and LinkedIn and Instagram. ###

CARMEL, Ind. – Financial services company Merchants Capital today announces it has secured $71 million in total financing for the Wildhorse Development, a market-rate, mixed-use luxury apartment and service retail complex located in Chesterfield, Missouri. The Wildhorse Development features 188 luxury units, a 15,000-square-foot Ruth’s Chris Steakhouse with a rooftop bar and 10,000 square feet of service retail. It is conveniently located 25 minutes outside of downtown St. Louis, a region known as an academic and corporate center for the biomedical sciences and home to some of the country’s largest privately held corporations. Great Lakes Capital finished construction on the asset in April 2021 and has leased to 100% occupancy in less than seven months. With the proceeds from the Merchants Bank of Indiana facilities, Great Lakes Capital paid off its existing construction loan, bought out Limited Partners from the original development and secured additional interest only for the property prior to the permanent financing takeout. “Great Lakes Capital presented us with this tremendous opportunity, and we were committed to structuring the financing to best fit their needs,” said Brian Shelbourne, Vice President of Originations at Merchants Capital. “With our team’s decades-long experience working exclusively on multifamily housing, we pride ourselves on our ability to provide customized financing solutions to meet the requirements of each unique transaction.” Great Lakes Capital, a real estate private equity firm, served as the sponsor of the project. “The Wildhorse Development is a signature, long-term asset for our team,” said Ryan Rans, Managing Partner of Great Lakes Capital. “It has been incredibly successful immediately out of the gate, and we’ve been thrilled to partner with Merchants Capital on the refinance. We look forward to working with them again on future deals, as we’ve always found them to be a creative, nimble and astute partner.” To learn more about Merchants Capital and its services, visit www.merchantscapital.com or find Merchants Capital on Facebook, Twitter, LinkedIn and Instagram.

CARMEL, Ind. – Financial services company Merchants Capital announces today it has provided $18.2 million in total refinancing for Eden Housing, a nonprofit that has partnered with local communities to develop or acquire more than 10,600 homes in communities throughout California. The proceeds will be used to rehabilitate two affordable housing communities in the state: Emerson Arms and Arroyo Vista. Located in the San Francisco-Oakland-Berkeley area, Emerson Arms is a 32-unit affordable apartment community with four one-bedroom units and 28 two-bedroom units within three residential buildings. All 32 units are covered by a long-term Option 5 HUD project-based Section 8 contract. The property was constructed in 1973 and last renovated in 2003. Rehabilitation plans include replacing the exterior podium and walkways that service each unit, new railings and exterior stairs, garage ceiling replacement/ventilation, traffic coating on walkways, roof and gutters replacement, window and sliding door replacement, building exterior painting and ADA compliant walkways. Secondly, Arroyo Vista is a 156-unit affordable apartment community located in Mission Viejo, Orange County, California, approximately 70 miles north of San Diego and 50 miles southeast of the Los Angeles central business district – an area in need of affordable housing. Constructed in 1995, the apartments have 36 one-bedroom units, 72 two-bedroom units, 40 three-bedroom units and eight four-bedroom units within nine two- and three-story residential buildings. All units are encumbered by a combination of rent and income restrictions ranging from 35% to 60% Area Median Income (AMI) through various regulatory agreements. Current resident amenities include on-site management, clubhouse, fitness center, playground, sports court, common laundry, pool and a spa. Rehabilitation plans include major plumbing upgrades throughout the entire property to address slab leaks, exterior stairs and railings, window replacement, carport and trash enclosure repairs, playground, in-unit HVAC, upgraded appliances and countertops and cabinets replacement. “It’s just as vital to preserve and recapitalize affordable housing as it is to produce it,” said Dwayne George, Executive Vice President, Head of Production at Merchants Capital. “With constraints on Private Activity Bond Volume Cap in state of California, Merchants is optimistic that partnering with key organizations such as Eden Housing to pilot creative debt solutions will complement California Housing Finance Agency (CalHFA) efforts to address the affordable housing crisis in the state of California.” Eden Housing currently serves a diverse population of 22,000 low-income residents from all cultures and backgrounds. The company services very low-, low- and moderate-income families, seniors, veterans, people living with physical, mental or development disabilities and the formerly homeless. “As we continue to face unprecedented times – where our portfolios are aging but we lack the variety of feasible financing solutions to address the physical needs – it is critical to have organizations like Merchants Capital that aim to step in and help affordable housing operators explore various solutions to meet our needs,” said Darnell Williams, Eden Housing Senior Director at Asset Management. “Like many affordable housing providers, we are feeling the implications of bond financing constraints. These two properties – although very different financial profiles – were each in need of a seven-figure capital infusion to buy us time before the next tax credit syndication is available. Dwayne and I began strategizing on possible loan products to address our needs and with his background in GSE financing, he was able to help us consider options that best suited each property. It has been a joy to work with him and his team on these deals.” To learn more about Merchants Capital and its services, visit www.merchantscapital.com or find Merchants Capital on Facebook, Twitter, LinkedIn and Instagram.

CHICAGO – The Chicago office of financial services company Merchants Capital recently secured more than $26 million in financing for the acquisition of Island Terrace, an affordable apartment complex in Chicago’s Woodlawn neighborhood. The project is located across from the planned Obama Presidential Center in Chicago. “We are proud to have served as the financing partner for this important project in Chicago,” said Emmett Donovan, Senior Vice President at Merchants Capital. “Merchants Capital is committed to preserving and expanding affordable housing options across the United States, and our work on this project strongly exemplifies that commitment.” After acquisition, the borrower, Preservation of Affordable Housing, Inc. (POAH), plans to syndicate the property with a tax credit structure utilizing both a 4% and 9% Low-Income Housing Tax Credit (LIHTC), making Island Terrace one of the first housing properties to utilize this unique type of financing. Upon syndication, all 240 units will be divided into two condominiums, with 178 units housed in the 4% LIHTC condo and 62 units in the 9% LIHTC condo. In addition to securing the acquisition bridge loan facility, Merchants Capital issued project term sheets for both the 4% and 9% LIHTC equity bridge loans to be used during the construction and renovation phase. “We are delighted to announce our purchase of Island Terrace. This is a crucial preservation opportunity given its location, and working with Merchants we can ensure its long-term affordability,” said Bill Eager, Senior Vice President at POAH. The syndication will ensure the long-term affordability of the project with the 20-year extension of the existing project-based Section 8 contract covering 88 units, the transfer and 20-year extension of a project-based Section 8 contract covering 44 additional units, an existing Chicago Low-Income Housing Trust Fund use agreement covering 11 units and a new Low Income Housing Tax Credit (LIHTC) use agreement restricting the remaining 99 units at the 60% and 80% area median income (AMI) levels utilizing income averaging. Renovation to Island Terrace is expected to begin in mid-2022, with a focus on improvements to major property systems and modernization of approximately $100,000 per unit. To learn more about Merchants Capital and its services, visit www.merchantscapital.com or find Merchants Capital on Facebook, Twitter, LinkedIn and Instagram.

CARMEL, Ind. – Financial services company Merchants Capital announces today it has secured a $35 million construction loan for Union at the Loop, an affordable, multifamily housing community coming to Lawrence, Kansas. Merchants Capital also acted as servicer for the $22.25 million Freddie Mac Tax Exempt Loan (TEL) forward permanent commitment. Union at the Loop, developed by The Annex Group, will be located at 3250 Michigan St. as the city’s newest affordable, 4% Low-Income Housing Tax Credit (LIHTC) property. The 248-unit property will house one-, two- and three-bedroom apartments for residents who earn up to 60% of the area median income (AMI), or an annual income of $35,800 to $57,300. “Due to Merchants Capital’s multi-layered debt products, we were able to offer and successfully secure construction and permanent financing for Union at the Loop. We are excited to partner with The Annex Group on this project that will provide much needed affordable housing options to the workforce families of Lawrence,” said Brian Emmons, Senior Vice President, Loan Operations for Merchants Capital. Notable amenities will include a business center and clubhouse, a fitness center, exterior storage, onsite management, picnic areas, a playground, video surveillance, walk-in closets and washer and dryers. The complex will be conveniently located to public transportation, grocery stores and restaurants. “When we started looking at the Lawrence area, we saw that almost all existing affordable housing communities had a wait-list of residents hoping to move-in,” said Kyle Bach, CEO of The Annex Group. “Because of the student population at The University of Kansas, there are both typical residents and university students in the rental market, causing a strain. We wanted to ease the need for affordable housing with a community that will feel like home to residents looking for conveniences, amenities and affordability.” Construction began in August 2021, and the property is expected to be open in October 2022. To learn more about Merchants Capital and its services, visit www.merchantscapital.com or find Merchants Capital on Facebook, Twitter, LinkedIn and Instagram.

CARMEL, Ind. – Financial services company Merchants Capital announces today it has secured $31.9 million in acquisition bridge loans and $57.8 million in seven separate 221(d)(4) loans for the Thetford Portfolio, a seven property low-income housing tax credit (LIHTC) 221(d)(4) pilot transaction in North Carolina. The deal was closed in partnership with Vitus, a national leader in preserving and enhancing affordable housing around the country. The North Carolina Thetford Portfolio consists of seven housing properties with over 90% Section 8 subsidy in addition to a number of budget-based rent increase properties on historical contracts from the Low-Income Housing Preservation and Resident Homeownership Act of 1990, which offered project incentives to preserve low-income rental properties. Merchants Capital provided the acquisition bridge loans to take down the seven properties at high loan-to-cost to facilitate the LIHTC executions, then closed on seven separate 221(d)(4) loans on the same day, simultaneously. “This seven-deal, same day closing for the North Carolina Thetford Portfolio is unprecedented with the Department of Housing and Urban Development (HUD),” said Merchants Capital Senior Vice President Matt Kaercher. “A single sub-rehabilitation LIHTC transaction is difficult enough for execution, but seven simultaneously requires a different subset of skills and persistence. The ability of all parties involved – from the borrower Vitus, HUD and our team at Merchants Capital – warrants the highest level of praise.” According to the National Low Income Housing Coalition, the U.S. has a shortage of over 6.8 million rental homes affordable and available to extremely low-income renters. Specifically, North Carolina has a shortage of 190,910 affordable rental homes available for low-income renters. The loan structure of seven new affordable housing developments will be a step in the right direction for the state. Additionally, during the project, Vitus closed a single bond issuance that saved the project money while pursuing the same day closing. “Vitus specializes in protecting existing affordable housing in communities with the greatest need. This was a unique transaction that enabled us to do so for seven properties at once. We are grateful for the guidance of the Merchants Capital team, the flexibility of our bond issuer Burlington Housing Authority and the cooperation of the many parties involved along the way in getting a deal of this complexity financed,” said Brooke Shorett, Director of Development Management for Vitus, the developer of the project. To learn more about Merchants Capital and its services, visit www.merchantscapital.com or find Merchants Capital on Facebook, Twitter, LinkedIn and Instagram. ###

CARMEL, Ind. – Financial services provider Merchants Capital today announces that it has formed a registered investment advisor, Merchants Asset Management LLC, and secured equity commitments totaling $165 million through a joint venture between an institutional investor and Merchants Bancorp. Evan Gibson Dean Ramsamooj The joint venture will purchase multifamily and healthcare commercial real estate loans from Merchants Capital’s parent company, Merchants Bank of Indiana. This venture will be managed by the newly formed investment advisor and initially operated by Merchants Capital’s Evan Gibson, Vice President of Debt Strategies; Terry Oznick, Senior Vice President and General Counsel; and Dean Ramsamooj, Vice President of Debt Strategies, while they continue to build out the investment advisory business. “This unique joint venture increases our ability to serve our top customers by increasing our lending capacity to them and expanding our product suite beyond the constraints of the bank’s balance sheet,” said Michael Dury, Merchants Capital President and CEO. “Moving forward, we can be more creative, efficient, and provide a better execution for our most valued clients.” Loans purchased by the venture will be financed by JPMorgan through a repurchase agreement that will allow for up to $600 million of loan capacity. Nomura Securities International, Inc. served as exclusive financial advisor and Arnold & Porter Kaye Scholer LLP acted as legal advisor to the venture. Today’s news comes on the heels of another milestone announcement by Merchants Capital’s Debt Strategies Group for the completion of a $262 million securitization of 15 workforce multifamily housing loans through a Freddie Mac-sponsored Q-Series transaction. The transaction with Merchants marked only the 15th deal completed under the Q platform, with Freddie Mac averaging just over two deals per year. To learn more about Merchants Capital and its services, visit www.merchantscapital.com or find Merchants Capital on Facebook, Twitter, LinkedIn and Instagram.