The Resurrection Project (TRP), an affordable housing developer, engaged SB Friedman to update a supplemental Tax Increment Financing (TIF) application to the City of Chicago, and aid in reviewing and structuring the pro forma for the Casa Querétaro (“Casa Q”) project.
The Casa Q project is located in the Pilsen neighborhood of Chicago and consists of 45 rental units, including 30 units affordable to households earning up to 60% of area median income, and 15 units that will be dedicated for use as Chicago Housing Authority (CHA) public housing. The financing sources for Casa Q include 4% Low Income Housing Tax Credits (LIHTCs), CHA capital funds, City of Chicago TIF funds, HOME funds, and tax-exempt bond financing. SB Friedman’s work included the following:
- Projecting TIF revenue from the Casa Q project and the entire TIF district;
- Identifying current obligations and potential available TIF fund balance;
- Identifying TIF-eligible costs in the Casa Q development budget;
- Restructuring the draw schedule in the pro forma to qualify under the “50% test” for 4% LIHTC and tax-exempt bond transactions, customizing TRP’s pro forma to illustrate proposed tax-exempt bond structures, and managing several iterations of the pro forma following changing costs and funding sources;
- Assisting with outreach to lenders to discuss proposed structure of transaction and TIF projections;
- Discussing timing, disbursement schedules, performance requirements, and other key deal factors with the City and funding partners; and
- Working with City and external funding partners to finalize closing documents and exhibits.
Results: Working closely with The Resurrection Project, City and funding partners, SB Friedman developed a creative transaction structure involving no permanent debt. SB Friedman supported TRP through the due diligence and final approval process, and funding for the project closed in December 2014. Mayor Rahm Emanuel officially unveiled Casa Querétaro in February 2016.
In 2018, TRP's Casa Queretaro was awarded first place for the Driehaus Foundation Award for Architectural Excellence in Community Design at the Chicago Neighborhood Development Awards.