Commercial Real Estate Capability

Affordable Housing

Affordable housing transactions are among the most legally complex in commercial real estate. They typically involve layered financing from multiple public and private sources, regulatory agreements that govern the property for decades, and a participant structure that includes sponsors, investors, lenders, public agencies, and syndicators — each with their own requirements and closing deliverables.

The firm advises sponsors, developers, and other participants in affordable and mixed-income housing transactions, including new construction, rehabilitation, preservation, and recapitalization projects. This practice has experience with the transaction structures, program requirements, and financing documentation common to this work.

Representation Includes

  • Low-Income Housing Tax Credit transactions, including competitive 9% allocations and bond-financed 4% credits
  • Tax-exempt bond transactions
  • Mixed-income, supportive housing, preservation, rehabilitation, and new construction projects
  • Soft financing, local and state incentive programs, and gap financing structures
  • Regulatory agreements, land use restriction agreements, and affordability covenants
  • Ground leases in connection with public land and land-trust structures
  • Nonprofit and for-profit developer and sponsor joint ventures
  • HUD and other federal program documentation where applicable
  • Year-15 recapitalization, resyndication, and exit planning

Transaction Considerations

Affordable housing transactions require coordination across a financing stack that often includes a tax credit equity investor, a construction and permanent lender, one or more public agency lenders, and subordinate soft debt providers. Each source has its own closing requirements, regulatory conditions, and approval processes. The firm works with sponsors and their transaction teams to manage these requirements efficiently and maintain the closing schedule.

Issues That Recur in Affordable Housing Transactions

  • Subsidy layering. Multiple public and private funding sources — tax credit equity, senior debt, and one or more layers of subordinate or soft public debt — each carry their own closing conditions, and the subordination and intercreditor relationships among them are documented alongside the primary loan.
  • Regulatory and use-restriction agreements. Recorded regulatory agreements, land use restriction agreements, and affordability covenants govern income and rent limits for the compliance and extended-use period, and are reviewed against the financing and operating requirements.
  • Carryover and placed-in-service deadlines. Competitive allocations may be subject to carryover-allocation, expenditure, and placed-in-service requirements. Bond-financed projects have different issuance, financing, agency, and placed-in-service requirements. The applicable deadlines are tracked against the construction and financing schedule.
  • Cost certification. The final cost certification supports the housing credit agency's determination of eligible basis and the final credit amount. The sponsor, investor, accountants, and agency coordinate the supporting documentation and any basis adjustments at completion.
  • Investor pay-in and adjusters. Equity contributions are tied to construction, lease-up, and stabilization milestones, with credit adjusters and funding conditions structured to protect the investor while preserving the sponsor's ability to fund the project.
  • Year-15 and exit. The extended-use agreement, purchase options and rights of first refusal, and resyndication or disposition planning are addressed in coordination with tax and compliance counsel.

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