Hunt Capital, Durham Housing Authority Plan Redevelopment of 177-Unit J.J. Henderson Senior Apartments in North Carolina
DURHAM, N.C. — Hunt Capital Partners, Durham Housing Authority and California Commercial Investment Group Inc. have closed $7.5 million in Low-Income Housing Tax Credit (LIHTC) equity financing for the acquisition and rehabilitation of J.J. Henderson Senior Apartments in Durham. Hunt Capital Partners facilitated the LIHTC financing through its proprietary fund with Signature Bank called Hunt Capital Partners Tax Credit Fund 39.
The acquisition is a Rental Assistance Demonstration (RAD) transaction, a program administered through the U.S. Department of Housing and Urban Development (HUD). By utilizing RAD, Durham Housing Authority gains access to more public and private funding resources to refurbish and preserve the property. Additionally, J.J. Henderson Senior Apartments converts from a public subsidy contract to a long-term Project-Based Rental Assistance Section 8 Housing Assistance Payment (HAP) contract.
Situated on 1.8 acres, J.J. Henderson Senior Apartments is an existing public housing property featuring a nine-story residential complex that contains 177 units for seniors 62 and older, or any age if disabled. It is currently 98 percent occupied and has a waiting list of six to 12 months.
This will be the first major rehabilitation of J.J. Henderson Senior Apartments since it was built in 1978. Rehabilitation will include ADA and energy-efficient upgrades in the units and community room, as well as upgrades to the exterior of the building. Work will also include demolition of the one-story auditorium wing of the building.
California Commercial Investment Group and its affiliates are serving as the developer and management agent for the project. Clancy & Theys Construction Co. is the general contractor, and MHAworks is project architect. Construction work is anticipated to begin in April 2021 and is scheduled for completion in December 2022.
When completed, J.J. Henderson Senior Apartments will offer 141 studio and 36 one-bedroom units restricted to senior households earning 30 and 60 percent of the area median income. The unit mix includes nine mobility-impaired units and 18 accessible units for persons with disabilities or homeless populations. Additionally, 133 units at J.J. Henderson Senior Apartments will benefit from a Section 8 HAP contract and 44 will be covered by a HAP contract through HUD’s Section 18 program.
The total development cost for J.J. Henderson Senior Apartments is $31.2 million, of which $12.5 million are hard costs related to renovation. In addition to Hunt’s LIHTC financing, Citibank NA provided a tax-exempt construction bond loan totaling $15.4 million. Orix Real Estate Capital provided a $2.2 million construction loan as well as a HUD 221(d)(4) construction-to-permanent loan amounting to $7.2 million. Other sources include a seller note of $11.7 million and a Durham Housing Authority soft loan of $2.9 million.