Trinity Housing of Cobourg Corporation (THCC) Budget Request for Phase 2 Rental Housing Project To the Public Budget Submission Council Meeting, Town of Cobourg January 14, 2019 6:00 p.m.
Trinity Housing Phase I – Existing Building • Existing 20 unit rental apartment building • Funded under the Federal/Provincial Non- Profit Housing – 1980s Program • Predominantly 2 bedroom units • Government provides ‘rent -geared-to- income’ (RGI) assistance through the County as the Service Manager • 35 year mortgage fully paid in 2025
Phase 2 • To be built on same parcel of land as existing 20 unit affordable housing project • Three story residential apartment building • 27 apartment units: – 4 studio – 20 one-bedroom – 3 three-bedroom
CMHC Low-Interest Loan Program • Phase 2: will seek funding under the CMHC Co-Investment Fund (CI Fund)Program: – A low interest loan program – up to 85% of total capital cost • 10 year term; renewable for another 10 year term, then commercial financing • amortization period up to 50 years • no rent-geared-to-income subsidy as in former affordable housing programs – A ‘contribution’ of up to 5% of total capital cost if project meets ‘high priority’ ranking
CI Fund Loan Amount Based On... • Higher ranking for things such as: – affordability: number of units, and low rents – energy efficiency, accessibility, proximity to transit, community supports, amenities – partnerships: other levels of gov’t ; agencies to support vulnerable populations • Debt Coverage Ratio (DRC) of 1 or better (cash flow determines amount of loan) • Approval process takes 3 to 5 months
Phase 2, 2018 Rents • 13 - affordable – CI Fund Program Definition • 14 - at market rents for area- as determined by an appraisal Apt Type Est. Market Rents Affordable Rents Studio (4) $936 $553 1 Bdrm (20) $1,274 $672 3 Bdrm (3) $1,554 $1,039 *Four units to be offered to support agency at ODSP rate
CMHC SEED Funding Program • To fund start up costs Trinity Housing has applied to CMHC’s SEED Funding Program • Start up costs include architectural and engineering drawings and specifications, soil and environmental study, appraisal, quantity surveyor, etc.) • Grant of up to $150,000 • Interest Free loan of up to $350,000 • Security is required for SEED loan
CI Fund Requires ‘Other Gov’t’ Contribution • Co-Investment Fund requires that another level of government makes a financial contribution • Can be a donation of land, waiving of property taxes and/or development charges, grant, etc. • Competitive process based on Co-Investment Fund program guidelines which include amount of contribution from funding partners.
Request of the Town • Trinity’s request of the Town: – Provide a grant equivalent to development charges, estimated to be $233,826 – Provide a ‘cash flow loan’ up to $400,000 – If required by CMHC, provide a loan guarantee for CMHC SEED loan of up to $350,000
Estimated Sources of Capital Funds • CMHC CI Fund Loan $4,462,270 • CMHC CI Fund 5% Contribution 322,847 • CMHC SEED Funding Grant 150,000 • Trinity Fundraising 100,000 • Trinity Land Donation 475,000 • Donation from Support Agency 325,000 • Grant = Development Fee 233,826 • Town “Cash Flow Loan” 388,002 • TOTAL: $6,456,945
Reduced property taxes as Alternative to Cash Flow Loan • As an alternative to Trinity’s proposed “Cash Flow Loan”, t he Town could provide an annual grant of 100% of the Town’s portion of the increase in municipal property taxes for up to 10 years • Increased project cash flow from lower property taxes would allow a higher CI Fund Loan.
Status of Phase 2 • Submitted SEED Funding Application. • Once SEED Application is approved, conduct initial due diligence work with SEED grant and apply to CI Fund • Once we receive CI Fund approval, proceed to construction drawings and specs, and tender construction • Seek final loan approval from CMHC (final interest rate not set until take-out mortgage) • Commence construction
Schedule • January 2019: apply for rezoning and OPA Amendment • January 2019: receive SEED Funding approval • March 2019: approval of Trinity’s funding request by Town of Cobourg • March/April 2019: initial due diligence work • April 2019: apply to CI Fund ( requires Town funding approval ) • July/Aug 2019: approval of CI Fund application • Aug/Sept 2019: working dwgs & specs; tender construction • Nov 2019: receive building permit approval • Nov 2019: receive CI Fund loan • Dec/Jan 2019: begin construction • Dec/Jan 2020: occupancy
Recommend
More recommend
