The borrower, Deer Park Housing Partners, LP has purchased and began to rehabilitate Deer Park & Apple Run Apartments (collectively the “Property”) located on two seperate sites at 2202 NW Hoover Avenue and 2403 Northwest 23rd Street, Lawton, Comanche County, Oklahoma 73505 (the consolidated address will be 2301 NW Williams Avenue – the address of the existing leasing office).
The Property consists of 12 two-story garden buildings built in 1948-1952 and 152 units, with a unit mix of 124-two-bedroom/onebathroom units and 28 three-bedroom/two-bathroom units, with total rentable square footage of 119,294. The combined sites are approximately 8.63 acres in an urban neighborhood comprised primarily of multifamily and single-family residences.
The property has a HAP contract that covers 100% of the units. Prior to MRE’s acquisition of the property, HUD was on the brink of abating the HAP Contract due to the poor condition and operations of this existing affordable housing property. The renovation of the property is now underway with a budget of $87,000 per unit.
The financing also involved the subordination of existing HUD mark-to market debt that was subordinated to the new HUD loan. The subordinated debt from the U.S. Dep of Housing & Urban Development (pursuant to a MTM debt transfer and subordination package that was prepared by the law firm of Hessel & Aluise to HUD’s Office of Recapitalization). The proposed long-term financing for the Property was a $6,100,000 first mortgage pursuant to the 221(d)(4) program (the “HUD Loan”). As part of the financing plan, the Borrower requested the early termination and 20-year renewal of the HAP Contracts on each Property - combining the two projects into a single transaction under the new HAP.
The financing plan included short-term tax-exempt bonds (cash collateralized) and 4% low-income housing tax credits (“LIHTCs”), both administered by the Oklahoma Housing Finance Agency.