Submitted Durham LIHTC Projects

Note: Hope all of your are doing ok during these tough times. I decided with so many people staying home, it would be appropriate to continue regular posts to give people a break from COVID-19 content. Stay safe and healthy.

The City of Durham is focused on housing, especially affordable housing. Given the way that the United States has created its policies, the most common way new affordable housing is built is through a program called "Low Income Housing Tax Credits" or LIHTC for short. This post focuses on the more generous of the two LIHTC programs, the 9% tax credit*.

Basically, the federal government grants tax credits to states and the states decide how to award those credits to development projects (its more complicated than that, but there's no need to get bogged down in the details for this post).

The state has all sorts of criteria, but for Durham, its most likely that the state will approve only one LIHTC project in the area. The project is chosen based on its ratings for location, demand in that area, proposed construction quality, distance to grocery stores and drug stores, financial feasibility and others.

There have been three projects submitted this year for LIHTC credits. All three score extremely well (only projects that know they will score well go through the time and expense of submitting an application). Below are the three potential LIHTC projects for Durham:

A. Ashton Place

Developer: DHIC, Inc
Address 310 Jackson St
Target Population: Seniors
Total Units: 51

B. Elizabeth Street Apartments

Developer: Laurel Street Residential, LLC
Address 544 Liberty St
Target Population: Family
Total Units: 72

C. Commerce Street Seniors

Developer: Laurel Street Residential, LLC
Address 1434 Commerce St
Target Population: Seniors
Total Units: 80

Laurel Street Residential, based in Charlotte, won the bid to redevelop 300 & 500 E Main Street into mixed use, mixed income projects (with parking decks). It seems like they have their eye on Durham and could be involved in quite a few projects here.

DHIC, based in Raleigh, has been active in affordable housing/mixed income in the area and is also involved with the upcoming Willard Street Apartments. It will be interesting to see which project wins.

Thoughts? Would love to hear from you in the forum!

* The 4% tax credit is much less sought after than the 9% credit for obvious reasons, even though it does have some small features that the 9% credit does not including the ability to raise additional public money. Regardless, it is more complex (which is saying a lot because the 9% credit is already complex) to figure out how to make the 4% credit work, so it is less competitive.

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