Tax Exempt Bond Financing The Related Group Related Urban (RUDG) - - PowerPoint PPT Presentation

Tax Exempt Bond Financing

The Related Group Related Urban (RUDG) Related Affordable (RAP)

 Jorge Perez is Chairman / CEO  Industry leader in condominium, market rate and affordable housing

development

 Currently Developing over 3,000 units throughout Florida  Independently Focused on Restructuring Legacy Projects and

Existing Assets

 Partners with Urban Development Group and Related Affordable  TRG Management / Fortune Contruction

 Partnership between The Related Group and The

Urban Development Group (RUDG)

 The Urban Development Group is Headed by Albert

Milo

 Primary focus New Construction, Preservation and

Substantial Rehabilitation

 Active in Competitive RFP’s/RFA’s including 9% Tax

Credits

 New York based Affiliate of The Related

Companies (Stephen Ross)

 Division headed my Matt Finkle that focuses

• n Preservation and Rehabilitation

 Partner with Related Group in most Florida

• pportunities

 Provide Gap Financing – CDBG/HOME/Other

 Work closely with Economic Development

 Restructure Existing Soft Debt  Ease of Execution  Work with Florida Housing in establishing

development requirements

 Flexibility in Fee Structure

 GSE Enhanced  Private Placement Bonds  Collateralized Bonds

The markets are constantly changing. The execution that works today may not be

• ptimal tomorrow.

 Advantages

• Competitive interest rates
• Non-recourse
• Higher LTV and lower DSCR

 Disadvantages

• High transaction costs
• More parties involved in transaction
• More restrictions on subordinate financing
• Letter of credit during construction
• Limited ability to lock rate

 Advantages

• Reduced Issuance Costs
• Easier Execution
• Funded on draw-down basis which reduces

negative arbitrage

• Typically no credit enhancement or rating required

 Disadvantages

• Tie up capacity with lender for extended term
• Limited number of lenders for private placement
• Lower LTV and higher DSCR requirements

 Advantages

• 1 Can yield higher loan proceeds
• 2 Flexible structures with favorable terms
• 3 Enhancement during construction by providing

cash collateral for bonds

 Disadvantages

• 1 Negative arbitrage during construction
• 2 High issuance costs
• 3 Limited ability to lock rate
• More parties involved in transaction

 Tax Exempt Mortgage Backed Securities