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00 <br /> ""W"a w, <br /> IMP. IMBO <br /> w Afforda6Ce Housing Committee <br /> 16 Great Neck RoadJVorth <br /> Mashyee, M-A 0264.9 <br /> Mr. Fellows stated they finished the building with rentals that are stacked in a way that looks <br /> like Legos. They were able to visit the factory and see the rooms and layout. The labor can <br /> sometimes be a challenge, like Boston and Chicago with active unions. Sometimes there are <br /> intersections with different sets of good intentions, and the project in Somerville is no exception <br /> to that. <br /> Ms. Muller stated the partnership with the modular company would benefit by collaborating <br /> with technical school's students that are learning the trades. Where are the organizations that <br /> are pressuring the state to make changes? <br /> Mr. Fellows answered POAH has been its own advocacy and belongs to a number of different <br /> industry organizations. They belong to Massachusetts Planning Association that helped <br /> influence the housing policy in this state and ensure we have a lot of funding sources. This <br /> current federal administration has given opportunity to streamline things at HUD. When you <br /> have direct federal financing, HUD guarantees a lot of bank loans for affordable. No one wants <br /> to contradict the Fire Marshal, we want energy efficiency, and a more predictable and <br /> streamlined process. There are a different set of code requirements, and over time, new <br /> editions. They have a construction project management group that tries to do as much local <br /> hiring and tap into that vocational training as much as they can. <br /> Mr. Sparkes noted most 40B's are friendly, and most projects are coming at the request of <br /> towns. The town issues the RFP requesting a developer who puts a bid on the project and <br /> works closely all the way thorough. They have a project that is not friendly, and 75% is market <br /> rate, it would fit the need for affordability and hits the SHI. <br /> Mr. Fellows stated there is a different set of economic incentives with a different product, <br /> different level of affordability, and accountability. After year 15, properties usually have asset <br /> management groups that plan for when they hit the mark of affordability and planning forthat, <br /> they almost never sell. A big component of partnership agreement is to ensure they have as <br /> much control at the back end so they don't have the property sold out, and the ability as <br /> general partner to dictate what will happen. <br /> Mr. Sparkes commented the value of credit offsets their tax liability; they get different yields <br /> from how the property operates. They take some risk in their investment and partnership <br /> agreements have different scenarios. Those credits could be taken back or recaptured if not <br /> followed through on commitments and could result in consequences down the line. <br /> Mr. Fellows stated the construction loan is for 18-24 months, which accounts for construction <br /> and the period of time to complete leases. You need to demonstrate 3 months of stabilized <br /> occupancy, a debt service coverage, then convert to permanent finance, with a 30-40 year <br /> 10 <br />