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HUD’s Multifamily Transformation Plan

hud-transformation_planThe U.S. Department of Housing and Urban Development (HUD) is in the process of implementing its multifamily transformation plan aimed, in part, at cutting FHA loan processing times. Expected to be completed by 2016, the plan includes HUD’s consolidation of its current 50 Multifamily offices into five Hubs in Atlanta, Chicago, Fort Worth, New York and San Francisco. Each Hub will serve one geographic region.

Under this new model, a central underwriter in each Hub will be responsible for triaging incoming applications for FHA multifamily mortgage insurance, pulling more complicated and riskier transactions and assigning them to specialized underwriting teams and taking more simple applications through a more efficient process.

The main goals of the new business model are to reduce FHA multifamily processing times and handle greater volume. HUD’s leadership presumes that under this new model, HUD will be able to finance deals that are larger and more complicated (e.g. mixed-finance). HUD’s “national workload sharing model” would also help to contribute to the faster pace – if one office gets backed up, applications are processed at another Hub office and then returned to the host office for closing.

For more information on the transformation plan visit the HUD website at: Transforming Multifamily for the 21st Century

For the latest from TCAM on federal housing finance, contact us at Steve Spall ( and Allen Feliz ( — (617) 542-1200.

Unlocking Value of Year 15 LIHTC Properties

screen_shot_2014-04-09_at_4.28.00_pmAs thousands of low-income housing tax credit properties approach Year 15 every year, the importance of planning for and managing Year 15 transactions (mostly Limited Partner buy-outs) has grown considerably over time. Owners/developers of aging tax credit properties, seeking to manage this process effectively and maximize value should develop plans aimed at achieving the following 4 goals.

Goals for Maximizing Value in Year 15


  1. Stem the bleeding for those properties to which the owner is currently advancing funds to cover debt service;
  2. Maximize future flexibility by buying out Limited Partners in transactions in which the owner wants to retain an interest;
  3. Take advantage of low interest rates to recapitalize properties with new debt and/or equity financing that allows long-term flexibility as to the use and future financing; and
  4. Determine, on a case-by-case basis, whether the long-term opportunity for each property is conversion to market-rate, redevelopment with a new round of tax credits, holding for cash flow as an affordable property, or sale once certain market and operating objectives are achieved.

TCAM helps owner/developers of tax credit properties nearing Year 15 achieve these goals by employing the following workplan.

TCAM’s Year 15 Workplan


  1. Reviewing and centralizing Year 15 partnership agreement provisions for each transaction.
  2. Analyzing recent and historical operations of property and project, including the property’s operational and financial performance through Year 15 of the initial tax credit compliance period. This analysis includes a projection of the property’s capital accounts through Year 15. The analysis is based on an initial review of property and partnership financial statements and key documents.
  3. Based on TCAM’s findings from #1 and #2 above, we provide the client with feedback on how to strategically plan for the remaining years of the property’s tax credit compliance period, including an initial evaluation of options for refinancing, selling the property, restructuring the partnership and/or buying out the Limited Partners.

If needed, TCAM can also provide on-going analytical and advisory support to the client in negotiating and in completing a buy-out, refinancing, sale or workout transaction.

To learn more about  TCAM’s Year 15 services, please contact Allen Feliz ( — (617) 542-1200.

GSEs’ LIHTC Portfolio Selling Activities Since 2008

screen_shot_2014-04-09_at_4.43.00_pmAs reported in the March 2014 issue of the Tax Credit Advisor, Fannie Mae and Freddie Mac have gradually sold their interests in LIHTC investments since being placed in conservatorship, however, the massive sale that was expected by many throughout the LIHTC industry has entirely subsided.*

After the two GSEs were placed in conservatorship, LIHTC industry professionals worried that the GSEs would try to sell large portions of their LIHTC portfolios in the secondary market and cause demand and prices to drop for new LIHTC product. However, when Fannie attempted to sell $3 billion of its portfolio in 2009, it was barred by the U.S. Treasury. Freddie was barred from a similar major sale of its LIHTC investments. Both GSEs ultimately wrote down the value of their LIHTC assets to zero as they were unable to utilize the credits.

However, since returning to profitability, Fannie and Freddie have restored the value of their remaining LIHTC assets to their balance sheets. Although the prohibition of a major sale has remained in place,

This policy has two exceptions:


  1. The GSEs are able to sell LIHTC partnership interests in response to a shortfall in an underlying project or in a fund in which they invest
  2. As individual properties within a fund reach Year 15 of the initial LIHTC compliance period and are sold by the syndicator.


Fannie Mae has sold off about $1 billion in LIHTC investments since it was placed in conservatorship which has helped raise funds to cover shortfalls in underlying LIHTC projects or at the upper-tier/fund level in which Fannie is an investor. While Fannie could engage in future sales of its remaining LIHTC investments, Freddie’s leadership is not aware of new efforts to sell its housing credit investments.

TCAM continues to monitor developments at the GSEs and its potential impact on the LIHTC industry. For the latest relevant updates, contact Allen Feliz ( — (617) 542-1200.


*Source: Tax Credit Advisor Magazine, March 2014 Issue. For TCA Magazine online, click here: Tax Credit Advisor

TCAM Announces New Engagement with Tax Credit Investor

BOSTON, MA – TCAM announced today that it has been engaged by a bank investor to manage a fund of affordable housing properties. TCAM’s services include property oversight as well as fund management, investor reporting and fund accounting. This engagement will help expand the capacity of the bank’s asset management group and help it meet its risk management and reporting requirements.

This engagement is the most recent new assignment for TCAM from a bank housing credit investor. TCAM is currently providing asset management and consulting services for other banks, investors, insurance companies, corporations, owners and foundations, as well as state and local housing agencies. TCAM has provided services to clients for over 800 properties comprising 120,000 apartment units in 46 states, Washington, D.C., and Puerto Rico, representing in excess of $5.5 billion of client capital. “Bank investors are exploring more options for managing their portfolios and investments,” said TCAM CEO Jenny Netzer. “TCAM is pleased to help them expand their businesses and increase their profitability.”

TCAM is owned by QuietStream Financial ( QuietStream Financial’s companies provide alternative asset management services and structured finance products for real estate borrowers, financial institutions and investors.

Extenders Bill Incl. 9% and 4% LIHTC Rate Floors

expire_actOn April 3, the Senate Finance Committee approved the Expiring Provisions Improvement, Reform, and Efficiency (EXPIRE) Act to extend for two years dozens of expiring tax provisions. This tax extenders package includes extending the minimum 9 percent LIHTC rate for allocations made before January 1, 2016 and an amendment establishing a fixed 4 percent LIHTC rate floor for acquisition of existing affordable housing, also for allocations made before January 1, 2016.


Description of The Chairman’s Modification to the Expire Act


Based on the strong bipartisan Committee support (approved by voice vote), the possibility of full Senate consideration of the bill soon seems favorable.  However, the timing remains uncertain. The Expire Act also extends for two years the New Markets Tax Credit, allows special treatment for the basic housing allowance for military personnel in LIHTC apartments, offers favorable tax treatment of mortgage debt relief and the deduction for mortgage insurance payments.

Finance Chairman Ron Wyden (D-Ore.) said the tax extenders package, with a price tag greater than $85 billion, would be the last on his watch as he seeks a broader overhaul of the tax code.


TCAM continues to monitor developments in tax reform legislation and its potential impact on the LIHTC program. For the latest updates, contact Allen Feliz ( — (617) 542-1200.

TCAM Team to Speak at Upcoming Affordable Housing Events

We’re excited to announce that members of the TCAM team will be participating in a number of conferences in the first few weeks of April.

Here’s a look at where you can find us:


Affordable Housing Investors Council (AHIC) – 2014 Spring Meeting

April 2-3rd in Washington, DC


One of AHIC’s three annual members-only events, the 2014 Spring Meeting focuses on policy issues and developments at federal agencies and on Capitol Hill. Attendees will have the opportunity to learn about developments in the industry, discuss the latest trends, hear from leading experts and network with peers. The event promises to be thought provoking and fun.

TCAM CEO Jenny Netzer will moderate the following panel:

Talk to Me: Strengthening the Bond Between Underwriting and Asset Management – Thursday, April 3rd, 9:45 a.m. – 11 a.m. in the Atrium Ballroom

Panelists include Peter G. Harrison, National Equity Fund, Inc.; James Horvick, Raymond James Tax Credit Funds, Inc.; Robert C. Landis, Raymond James Tax Credit Funds, Inc.; Elisa Lass, JPMorgan Capital Corp.; Douglas S. Lloyd, JPMorgan Capital Corp. and Judy Schneider, National Equity Fund, Inc.

NeighborWorks Executive Director Symposium (EDS)

April 2-3rd in Washington, DC


This annual event involving executive directors from all NeighborWorks organizations consists of two full days of learning, brainstorming, networking and sharing best practices.

TCAM Managing Director Allen Feliz will participate in the following panel:

Key Challenges and Opportunities in the Second Cohort of Year 15s – Monroe, Main Lobby Level, South Tower

The discussion will focus on real estate deals from 1996-2002, paying particular attention to transactions and staffing. The panelists will address topics like partnership agreements, financing strategies, staffing demands and more.

Panelists include Harold Nassau, Senior Manager, National Real Estate Programs, NeighborWorks America, Boston, Massachusetts; Janaka Casper, President & CEO, Community Housing Partners Corporation, Christiansburg, Virginia; Amy Klaben, Homeport, Columbus, Ohio and Allen Feliz, Managing Director, TCAM, LLC., Boston, Massachusetts


IPED – Housing Tax Credits 101

April 9-10th in Boston, MA.


This event is the industry’s most comprehensive and longest-running course on the fundamentals of the Low Income Housing Tax Credit Program. Attendees will have the opportunity to learn from leading national experts in the LIHTC industry and from peers through networking and discussions on some of the critical issues facing the affordable housing industry in 2014 and beyond.

TCAM Managing Director Allen Feliz will participate in the following panel:

Unlocking Value and Seizing Opportunities in Year 15 – Thursday, April 10th, 9:45 a.m. – 11 a.m. at the Omni Parker House

This panel will provide a succinct overview of the rules governing Year 15 and discuss how informed owners can approach Year 15 to maximize opportunities in Year 15.

Panelists include Tom Giblin, Partner, Nixon Peabody LLP; Caitlin Dunne, Associate, Nixon Peabody LLP; Allen Feliz, Managing Director, TCAM; Jeff Rahn, Boston Financial Investment Management, and Charlie Rhuda, CPA, Partner, Novogradac & Company LLP


To learn more about the latest trends in the affordable housing industry contact Allen Feliz at ( — (617) 542-1200.

Addressing Troubled Assets

History can be instructive. During the 1990s savings and loan crisis government regulators strongly encouraged lenders to dump troubled assets, which they did – many at deep discounts. As a result, savvy investors were enriched.

The financial crisis of 2008 took place in a very different regulatory environment. This time around the regulators have backed off. They wanted to prevent the hedge fund investors from making another killing at the expense of the lenders. There was no wholesale push to sell assets. And in fact many of those troubled assets have turned around and are now back on track.

10_year_treasury_rateWhile delay and deferral has turned out to be a successful strategy, we believe that the time has come to tackle those thorny problems. Despite recent upticks, interest rates are still at historic lows, lenders are more open for business than they were in the years immediately following the financial crisis and many developer/owners are enjoying the strongest financial condition they have experienced in recent years.

Meanwhile, regulatory pressure to address distressed loans remains relaxed, allowing lenders to liquidate troubled assets at their discretion. Accordingly, there are opportunities for owners and lenders which may not last for long. At some point, the Federal Reserve is going to pull back on quantitative easing. Once that occurs interest rates will likely increase which will put pressure on capitalization rates. These likely trends will cause real estate values to decline and ultimately make restructurings and refinancings significantly more difficult.

So, are we nearing the “end of pretend”? How will troubled assets be addressed once interest rates rise to historic norms and terms erode? In a less friendly regulatory environment will lenders be forced to simply foreclose and engage in fire sales as they did in the early 1990s? Now is the time for owners to contact reluctant lenders and bring them to the table. Lenders need to be convinced that it is in their best interest to restructure troubled assets now, before this historic opportunity passes them by.


To learn more about how TCAM can help your organization address troubled assets, contact Steve Spall ( and Allen Feliz ( — (617) 542-1200.

The Camp Proposal: An Early Victory for the LIHTC?

tax_reform_act_dave_camp_fbOn February 26, House Ways and Means Chairman David Camp (R-MI) revealed his long-awaited tax reform proposal, which includes some version of the Low Income Housing Tax Credit.

The Camp plan, including proposed changes to the LIHTC program, remains under examination by lawmakers and housing industry participants alike, however, early analysis indicates that the LIHTC has met the litmus test put forth by Chairman Camp which preserves “expenditures that can prove they provide for an activity that would not otherwise occur in the marketplace” and that serve as a clear “safety net”.


Proposed modifications to the LIHTC program include the following

(prepared and released by the Ways and Means Majority Staff):


  • The credit period would be extended from 10 years to 15 years to match the current initial compliance period and recapture rules would be repealed as they would no longer be necessary to ensure that the building continues to be a low-income housing project for the duration of the tax benefit;
  • The 4-percent credit would be repealed but the 9-percent credit for newly constructed property and substantial rehabilitations would be preserved;
  • Federally funded grants would not be taken into account in determining the eligible basis. The amount of credit would be equal the qualified basis in the qualified low-income building multiplied by the applicable percentage; and
  • State and local housing authorities would allocate qualified basis, rather than credit amounts. The annual amount would continue to include unused basis allocations from the prior year plus basis allocations returned to the State during the calendar year from previous allocations. The national pool of unused credits, however, would be eliminated.


To read the full proposal from Chairman Camp go the following link: Camp Proposal


TCAM continues to monitor developments in federal tax reform efforts and the potential impact on housing programs. For the latest updates on tax reform efforts, contact us at Steve Spall ( and Allen Feliz ( — (617) 542-1200.

TCAM Offers Asset Management Training

BOSTON, MA – Today, TCAM announced that it is offering a new service for capital providers in the affordable housing industry: asset management training. TCAM recently designed and conducted a training program for a syndicator of Low-Income Housing Tax Credit assets, and is engaged by two housing authorities to provide asset management training later in the year. TCAM’s training services include program design and development of materials as well as delivery of training.

“Training is a natural follow-on to the asset management consulting services we offer to clients,” said TCAM CEO Jenny Netzer. “In response to client demand, we have developed a comprehensive program that can be tailored to meet each client’s specific needs.”

TCAM ( provides asset management and consulting services for investors, syndicators, owners, lenders, housing finance agencies and authorities and guarantors. Overall, TCAM has provided services to clients for over 800 properties containing 120,000 apartment units in 46 states, Washington, D.C., and Puerto Rico, representing in excess of $5.5 billion of client capital

TCAM is owned by QuietStream Financial ( QuietStream Financial’s companies provide alternative asset management services and structured finance products for real estate borrowers, financial institutions and investors.


For more information on our Asset Management Training Service, contact us.

TCAM Announces Appointment of New Managing Director

allen_felizToday, TCAM announced the promotion of Allen Feliz to Managing Director. The promotion recognizes Mr. Feliz’s role in managing the Company’s engagements with a wide range of clients, including for-profit and non-profit developers and public agencies. As Managing Director, Mr. Feliz will be part of TCAM’s senior staff setting policy and guiding the Company’s growth.

Mr. Feliz has been with TCAM since its inception five years ago. As a Director at TCAM, he has played key roles in research, business development and delivery of consulting services. Prior to joining TCAM, Mr. Feliz worked at MMA Financial and Brown University. He holds a BA from Brown University and a Master of Public Administration from the Maxwell School of Citizenship and Public Affairs at Syracuse University.

“Allen has been instrumental in building TCAM and in delivering high-quality services to our clients,” said CEO Jenny Netzer. “This promotion recognizes his role in the continuing success of TCAM and our clients.”

TCAM ( provides asset management and consulting services for investors, syndicators, owners, lenders, housing finance agencies and authorities and guarantors. Overall, TCAM has provided services to clients for over 800 properties containing 120,000 apartment units in 46 states, Washington, D.C., and Puerto Rico, representing in excess of $5.5 billion of client capital.

TCAM is owned by QuietStream Financial ( QuietStream Financial’s companies provide alternative asset management services and structured finance products for real estate borrowers, financial institutions and investors.