Press Release

CARMEL, IN – Mortgage banking firm Merchants Capital has secured $16 million in construction and permanent financing through a Merchants Bank of Indiana construction loan and a Fannie Mae Mortgage-Backed Security (MBS) as Tax-Exempt Bond (M.TEB) Forward loan. The M.TEB loan, the first ever with Hennepin County Housing and Redevelopment Authority as bond issuer, had the lowest permanent rate to date for the M.TEB program. Fannie Mae’s MBS as M.TEB is considered a “one-size-fits-all” bond solution. By combining the ease of the MBS execution with all the benefits of tax-exempt bonds, borrowers get a lower interest rate and significant savings over the life of the loan. This execution can be used to finance the new construction and rehabilitation of Multifamily Affordable Housing (MAH) properties. Dubbed The Redwell, the affordable mixed-use multifamily development was closed through a partnership with Fannie Mae and Stifel, Nicolaus & Co., Inc. As part of the funding, Merchants Capital also arranged a $1.7 million construction loan with 10-year permanent financing and a $7.9 million Low-Income Housing Tax Credit (LIHTC) Equity Bridge loan for the project on behalf of Schafer Richardson and WNC. The total development cost of the entire project is more than $31 million, with an estimated LIHTC credit equity of $9.1 million and $22.7 million in permanent financing and other funds. “Merchants Capital is thankful to all of the partners involved in this transaction for their efforts in this complex deal,” said Marsha Goff, executive vice president of Merchants Capital. “The unique structure of this loan was an enjoyable challenge for us, and the  ability to close within a tight timeframe to meet bond requirements and also bifurcate the commercial component to meet the LIHTC investor requirements allowed the Schafer Richardson team to break ground on this much-needed affordable housing project.” By leveraging Merchants Capital’s bank, Merchants Bank of Indiana, Merchants Capital was able to structure the funding to provide a small construction loan and accommodate the LIHTC requirements  which allowed the commercial component to remain within the development. Additionally, Tax Increment Financing (TIF) provided by the City of Minneapolis is being monetized to support the proposed permanent loan amount. Hennepin County Housing and Redevelopment Authority acted as the bond issuer. “We are excited to see construction commence after over four years of planning and structuring the deal,” said Amanda Janzen, project manger of Schafer Richardson. “The Redwell was originally planned as an office building, then switched direction to new construction market rate housing, and then affordable housing. The Redwell will be an asset to the neighborhood and provide much-needed affordable housing in the desirable North Loop.” The Redwell is a 109-unit, six-story multifamily complex with commercial space on the first floor. Twenty-six of the units will be studio apartments, along with 68 one-bedroom and 15 two-bedroom units. The Minneapolis Public Housing Authority (MPHA) will provide 22 Section 8 vouchers whereby households would pay 30% of their income toward rent, with the balance paid by federal rental subsidies administered by MPHA.  The remaining units will be priced at 110% fair-market rate at 60% of the area median income (AMI). “We would like to congratulate Schafer Richardson and all the partners who have worked tiressly to add to the North Loop Neighborhood.  WNC is proud to be participating in our second investment with Schafer Richardson in Minneapolis” noted Michael Byrd of WNC & Associates. “These developments are time consuming and difficult to put together. Schafer Richardson did a great job of getting all of the financing and approvals necessary to get the property closed and under construction.” In addition to providing mixed-use, mixed-income and affordable housing in the North Loop District of downtown Minneapolis, the new development is located near mass transit stations and has nearby access to the interstate and intersects several trails and parks along the Mississippi River.

CARMEL, IN – Mortgage banking firm Merchants Capital has provided a construction loan and permanent financing for Spur 16, a 156-unit, mixed-use development in Mequon, Wisconsin. As the lender, Executive Vice President Lee Oller and Senior Vice President Susan Schnoll provided the construction and 40-year, fixed-rate, non-recourse loan through the U.S. Department of Housing and Urban Development (HUD)’s 221(d)(4) program on behalf of Shaffer Development. “Spur 16 is particularly special because its financing and development was led entirely by women,” Schnoll said. “With visionary developer Cindy Shaffer at the lead, this female development and lending team was able to bring the project to life, delivering a beautiful and unique project to the market.” Spur 16 combines the construction of new luxury apartments and high-end townhomes with the repurposing of three original public works buildings into vibrant commercial space, including a public market. The development features a clubhouse with a swimming pool, fire pits, event rooms and a workout facility outfitted with Peloton Bikes. Nestled in the heart of Mequon and within the beauty of nature, Spur 16 also features community gardens and a walking path with access to the Ozaukee Interurban Trail. The apartments and townhomes offer concierge service for residents, including car detailing, dog walking, in-unit package delivery and food delivery. The first Leadership in Energy and Environmental Design (LEED)-certified project in Mequon, Spur 16’s deluxe “Smart Units” will allow tenants to control lights, temperature, music and emergency services. “Working with Merchants Capital as the lender on this project has allowed the creation of an exceptional addition to the Mequon area,” said Cindy Shaffer, owner of Shaffer Development. “Shaffer Development isn’t in the real estate business – we’re in the people business. Spur 16 introduces modern, luxurious amenities to greater Milwaukee residents looking to live in an up-and-coming community.” The development’s Mequon Public Market opened in June 2019 and brought some of Milwaukee’s premier restaurants north. Now 100% leased, market vendors include Anodyne Coffee, Purple Door Ice Cream, Beans and Barley, Screaming Tuna, Café Corazon, Bavette, Bowls, Happy Dough Lucky, Santorini Grill and Terrain. The development also houses St. Paul Fish Company, a retail store, an oyster bar and various indoor and outdoor dining. There is also a wellness building housing the Mequon Club Pilates and Yama Yoga True North.

CARMEL, Ind. (Aug. 23, 2019) – Mortgage banking firm Merchants Capital has secured $21.4 million in funding using a Fannie Mae Mortgage-Backed Security (MBS) as collateral for new Tax-Exempt Bonds (M.TEB), combined with 4% low income housing tax credits (LIHTC). The funding was the first of its kind in the state of Indiana and sourced on behalf of long-time Merchants Capital customer, the Gene B. Glick Company, for the preservation of Carriage House of Evansville, a Section 8 housing development in Evansville, Indiana. The execution utilized publicly-issued tax exempt bonds and 4% tax credit equity, provided by PNC Bank, to fund approximately $11 million in repairs, renovations and upgrades to the community. Carriage House of Evansville dates back to 1978 and is a 100% Section 8 affordable housing community serving tenants at 60% of the area median income (AMI) or less. Fannie Mae’s M.TEB solution provides borrowers with a lower interest rate and significant savings over the life of the loan, offering a loan-to-value (LTV) ratio of up to 90%. This execution can be used to finance the construction, acquisition or rehabilitation of Multifamily Affordable Housing (MAH) properties. “Fannie Mae continues to look for ways to create and preserve affordable housing,” said Angela Kelcher, Director of Affordable Housing at Fannie Mae. “The MBS as Tax-Exempt Bond (M.TEB) execution provides efficient, low-cost financing and we were excited to work with Merchants to support the preservation of affordability while also improving the quality of housing for the residents.” CRG Residential is the general contractor on the project and is performing all renovations at the site. All units are being modernized using CRG’s RAPID program, which completely renovates and modernizes units in just days, limiting disturbance to existing tenants. Updates include new solid surface flooring, cabinetry and countertops, energy efficient light fixtures, appliances, doors and trim, and complete bathroom renovations. “We are excited to partner with Fannie Mae and Glick to preserve much-needed affordable housing in the state of Indiana,” said Michael R. Dury, president of Merchants Capital. “Fannie Mae’s M.TEB program gives access to a lower cost of capital, which allows the development team to substantially renovate the community. As with any project involving Glick, the company’s vision and strategy is first class and at the end of the day, the completion of this project is a win for the tenants, which is wonderful.” Additional Carriage House of Evansville improvements include entry signage, asphalt and storm drainage repairs, roofing, modernized elevators and playground equipment, as well as the addition of a bark park, lakeside picnic area, fitness center and an internet cafe. “We’re grateful for our long-standing relationships with Merchants Capital and Fannie Mae that enable us to undertake renovations like this one at Carriage House of Evansville,” said David Barrett, president and chief executive officer at Glick. “Ultimately, this project illustrates our commitment to our residents – preserving their affordable housing and providing them high-quality apartment homes.”

CARMEL, IN (Aug. 22, 2019) – Mortgage banking firm Merchants Capital has hired Matt Winter, AIA, NCARB as Chief Architect at the company’s Chicago office. The move brings the position in-house, setting Merchants up to process new lending opportunities more efficiently while maintaining, and even improving on, the internal monitoring requirements set forth primarily by Freddie Mac. This decision comes in large part due to Merchants Capital’s growing relationship with Freddie Mac and the utilization of its affordable housing products. “We are excited to have Matt join the Merchants family as we continue to expand our Chicago team,” said Michael Dury, President of Merchants Capital. “Matt’s expertise will help streamline our upfront and ongoing construction reviews with our agency products, which are commonly paired with our blanace sheet construction loans. Few projects go 100% according to plan, so having Matt’s experience internally will help us catch problems sooner and better work with our customers to solve any issues that do occur.” In this role, Winter will monitor key factors that lead to the successful finanacing and construction of affordable, senior, health care, student and market-rate projects and share those insights with Merchants’ lenders, analysts and asset managers. Additionally, Winter will use his talents in construction documentation and budget review to ensure new construction projects are appropriately budgeted up front so that Merchants and its customers can avoid critical issues later in the project. Where applicable, Winter will also rely on his experience to perform necessary pre-construction due diligence and construction monitoring reports necessary for project financing. Winter’s role will allow the team to be more flexible with time and resources, therefore improving response time to loan opportunities with a quicker turn. Prior to joining Merchants Capital, Winter spent eight years with GTG Consultants. At GTG, Matt served as an architectural and construction consultant to both lenders and investors. Prior to GTG, Matt has worked for other architectural and construction firms that specialized in single-family or hospitality design and construction. Winter earned his B.S. in Agribusiness and Horticulture from Illinois State University, as well as a B.S and Masters in Architecture from the University of Cincinnati. He is a registered architect in the state of Illinois.

CARMEL, IN (June 27, 2019) – Mortgage banking firm Merchants Capital has secured funding for a new 32-unit workforce housing development in Lafayette, Indiana. This development is part of the state of Indiana’s Lieutenant Governor’s office as a Moving Forward 2.0 workforce tax credit housing development with an emphasis on breaking the barriers that result in generational poverty. Using net-zero construction, the development – known as H38 East Apartments - leverages the Indiana Housing and Community Development Authority (IHCDA) program Moving Forward 2.0, an innovative program aimed at providing affordable, energy-efficient housing and transportation. In partnership with RealAmerica Development, LLC and Area IV Agency, this development will create housing that increases quality of life while decreasing the cost of living for low- to moderate-income individuals and families. The City of Lafayette and Lafayette Housing Authority provided HOME funds and tax abatement for H38 East Apartments. “This innovative affordable housing project, H38 East Apartments, combines a healthy way of living with partnerships that bring together energy efficiency, education and skills development, nutrition and wellness, along with breaking transportation and child care barriers to allow for successful resource and employment development,” said Elva James, executive director of Area IV Agency on Aging and Community Action Programs. All of the units will be priced affordably for low- to moderate-income individuals and families with 30 units priced at 60% of of the area median income (AMI) and two units priced at 50% AMI. Additionally, as part of the Moving Forward 2.0 Program, each household will have the opportunity to participate in an ongoing research study to determine the effectiveness of the program. “This development is one of the first of it’s kind in Indiana, and we appreciate the opportunity to work alongside the RealAmerica and Area IV Agency teams,” said Michael R. Dury, president of Merchants Capital. “Using this unique funding structure, our team was able to provide the construction loan, tax credit bridge financing, and permanent financing which helped streamline the lending process from start to finish.” Using an extremely efficient building design, the new development, located at 3791 Winston Drive, in Lafayette, will include solar power and geothermal features that use 35% of the energy a typical apartment would require. The property is located near Franciscan Health Lafayette East, the YMCA of Lafayette, the Lafayette campus of Ivy Tech, the Tippecanoe Mall and city bus line. “We were honored to be chosen as part of the Moving Forward 2.0 program through IHCDA to help address generational poverty. It truly takes a team to create such an amazing program to help families thrive,” said Ronda Shrewsbury Weybright, president and owner of RealAmerica Development, LLC. “H38 East will do just that with its affordable, net-zero apartment homes and opportunities through supportive services. Seeing the support from the community and businesses coming together to help create such a positive program is remarkable.” Area IV Agency’s onsite Life Skills Coach mentoring program will assist families in areas of life skills, education and career development. Additionally, the development will contract with Enterprise Rent-A-Car to provide a car-share program, Faith Ministries Car Repair and Loan Program, and local transportation providers. H38 East Apartments will also be home to a Community Building with unique amenities, including a classroom, STEM center, technology center, a teaching kitchen and more. Additional community amenities include a playground, community gardens, and recreation and athletic area, along with a fitness and wellness center and a bike-share program.

CARMEL, IN – Mortgage banking firm Merchants Capital has secured $51 million in agency funding for a homeless shelter in the Crown Heights neighborhood of New York City on behalf of Heights Advisors, a leading social impact investor, and Samaritan Daytop Village (SDV), a nationally-recognized human services organization. The project – known as 267 Rogers - embodies an emerging model that New York City is utilizing to eradicate homelessness in the future. Through the Freddie Mac Affordable Housing Capital Markets Execution (CME) Loan Program, this transaction represented an opportunity for Merchants Capital and Freddie Mac to establish themselves as a key counterparty and partner in financing public-benefit multifamily buildings that serve residents most in need. “It has been deeply gratifying to work on the deployment of capital on a project that allows homeless families to live in dignity,” said Mathew Wambua, executive vice president at Merchants Capital. “Projects like 267 Rogers allow the Merchants Capital team to be creative and innovative in solving problems and seeking new financial strategies and structures to solve those problems while serving an immediate need right here in our community.” The property was effectively built as a 165-unit multifamily development under the typical 80/20 structure in New York City. This property is unique, however, in that rather than renting 80% of the units to market-rate tenants, they instead partnered with the Department of Homeless Services (DHS) and SDV to offer transitional housing to homeless families. Thus, the entire property offers affordable housing wherein, 80% of the units are reserved for transitional housing and the remaining 20% are set aside for families earning 60% of the area medium income (AMI) or below. Through the partnership with SDV, the property is able to offer supportive services to all tenants, including employment and job readiness services, daily living workshops, and personal financial management, as well as education and child care assistance programs. “It is a priority for us to contribute and be responsive to the communities we work within. We are excited to work with Steve Banks and the DHS staff to create fully-integrated, quality housing for families in need,” said Rachel Foster, principal and founder of Heights Advisors. “We greatly appreciate the financing the Merchants Capital team was able to provide. We look forward to continuing to work alongside the city and those in the private and nonprofit sector to bring new solutions to the housing crisis.” In April 2016, Mayor de Blasio announced a major restructuring of the way homeless services in New York City are delivered, creating an integrated and streamlined management structure for DHS and the Human Resources Administration (HRA) under the commissioner of the Department of Social Services. The Mayor’s new anti-homelessness plan represents a paradigmatic shift from the way in which previous administrations have mobilized to combat chronic homelessness, transitioning out of the 360 scattered apartment sites and commercial hotel facilities and replacing them with approximately 90 new multifamily transitional housing shelters. New York City plans to open approximately 20 new multifamily transitional housing shelters annually in the next five years to reach its goal of opening approximately 90 new shelters. 267 Rogers represents one of the first multifamily transitional housing shelters that has been developed as the cornerstone of the new mayoral plan.

We are pleased to announce the promotion of Emmett Donovan to FHA Deputy Chief Underwriter!  This is an incredible accomplishment and one that takes years of hard work and perseverance. As a former Vice President at Draper and Kramer Commercial Mortgage Corp., Emmett successfully underwrote all types of FHA loans and helped produce over $1 billion in HUD insured loans. In his capacity at Merchants, Emmett serves as Senior Vice President and as a voting member of the FHA Loan Committee. Emmett Donovan Emmett is a graduate of the University of Kansas and holds an MBA in Finance from the Kellstadt Graduate School of Business at DePaul University. CONGRATULATIONS EMMETT! EMMETT DONOVANSENIOR VICE PRESIDENT, FHA DEPUTY CHIEF UNDERWRITERChicago, Illinois

CARMEL, Ind. (May 9, 2019) – Mortgage banking firm Merchants Capital has arranged nearly $50 million in total financing for three assisted living communities in Ohio: The Ashford at Mt. Washington, The Ashford on Broad and The Ashford on Sturbridge. Merchants Capital secured the bridge loans on behalf of Wallick Communities, which develops affordable assisted living and memory care communities. The bridge financing allows the communities to continue leasing and reach the required time beyond construction completion in order to be eligible to be insured by the Federal Housing Administration (FHA). “Our team closed these loans in less than 70 days from the day of engagement,” said Michael R. Dury, president of Merchants Capital and the portfolio’s leading originator. “We were able to simplify the process because of our unique ability to execute the bridge loan through our parent company, Merchants Bank. During the bridge loan application process, we were able to advise them on structuring the takeout financing via FHA.” The first community, The Ashford at Mt. Washington, received $13 million in financing over 24 months. The 108-unit community is located in Cincinnati, Ohio. The Ashford on Broad received $16 million in bridge financing over 36 months. Comprised of 131 units, the community is located in Columbus, Ohio.  The third and final community is The Ashford on Sturbridge, which received $20 million in financing over 42 months. The 124-unit community opened in early 2019 and is located in Hilliard, Ohio, a middle-class suburb of Columbus. All three communities are designed to serve working- and middle-class seniors, offering rents at 15–30% below those in similar communities. In addition, by using Ohio’s Medicaid Waiver program, residents are allowed to stay once their financial resources have been exhausted. “As baby boomers age and the costs of senior health care continue to rise, the need for affordable, well-maintained communities like these are becoming more and more critical,” said Tom Feusse, CEO of Wallick Communities. “Partnering with Merchants Capital on these projects was vital to our work and fulfilling our mission of Opening Doors to Homes, Opportunities and Hope to seniors across Ohio.” Merchants Capital is a leading multifamily lender offering customized loan products for independent living, assisted living, memory care and skilled nursing projects. A variety of loan products are available to accommodate construction, rehabilitation, acquisition and refinancing of healthcare properties throughout the country.

CARMEL, Ind. (April 18, 2019) – Leading mortgage banking company Merchants Capital today announces the opening of a production office in Chicago, located at 131 S. Dearborn St. in The Loop – the company’s fourth office nationwide. Lee Oller has been hired as executive vice president to lead the Chicago team. Oller brings 26 years of experience as a Chief and LEAN Underwriter and has produced more than 350 closed transactions involving the Federal Housing Administration (FHA) and Department of Housing and Urban Development (HUD) loan platforms. She brings a deep understanding of FHA, multifamily and affordable housing that will allow Merchants Capital to grow its local presence in Chicago and regionally across the Midwest. “Merchants Capital is well known in the industry for its passion for multifamily and affordable housing,” Oller said. “The biggest draw to joining Merchants was the ability to diversify our lending products especially Fannie Mae and Freddie Mac. The additional tools at our disposal, along with Merchants commitment to growth and innovation with the support from its banking operation, Merchants Bank, made the decision easy because of the direct benefit to clients.” Joining Oller in the new Chicago office are four senior vice presidents: Susan Schnoll, Alan Cravitz, Brian Black and Emmett Donovan. Schnoll is recognized in the Wisconsin market for her HUD lending knowledge. Cravitz, Black and Donovan bring more than 80 years of combined multifamily lending experience to the team. “This veteran team complements each other and has worked together for many years,” said Oller of the employees joining her in the new Chicago office. “Our expansion to Chicago with this talented group is a very meaningful step in increasing our national lending footprint,” said Michael Dury, president of Merchants Capital. “Lee’s ability to lead is remarkable. We are very excited to introduce her team to our diverse lending products that will allow them to offer a wide variety of solutions.” This expansion follows Merchants Capital’s announcement that it is now servicing more than $10 billion in loans and was named No. 10 on the Top 25 Affordable Lenders of 2018 list by Affordable Housing Finance. The company continues to seek driven employees for a number of positions in all four offices, including New York City and Saint Paul, Minnesota. For career opportunities, visit our careers page.

To our valued customers, Since opening our doors in 1990, the Merchants Capital team has worked tirelessly to become nationally recognized as a leader and premier provider and servicer of multifamily, senior and student housing. Recently, our hard work and commitment was recognized by Affordable Housing Finance. We’re proud to announce that Merchants Capital was named in the Top 10 Affordable Housing Lenders of 2018!This accomplishment is evidence of our commitment to advancing affordable housing nationally and ranks us among the top affordable lenders in the country. In 2018 alone, our originations team closed 207 loans and generated nearly $2.6 billion in new loan production nationwide.  That included $1.10 billion in affordable housing, demonstrating a 146 percent increase in affordable housing production compared to 2017. Over the past 28 years, Merchants Capital has originated and closed more than $13.8 billion in loans. Thank you for your continued support and loyalty. We wouldn’t be where we are today without your commitment to Merchants Capital. Sincerely, Michael R. Dury, President, Merchants Capital WE ARE MERCHANTS CAPITAL A Multifamily, Affordable, and Healthcare Lender offering a direct way to access fixed rate, long-term, non-recourse financing via our bank, Merchants Bank, all with a single point of contact.