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11 <br /> Information Points <br /> • On May 4, 2011, Orange County made a $300,000 loan to the Landings at Winmore <br /> for the development of the 58-unit apartment complex. The loan came from the federal <br /> HOME Program funds and the interest rate is 2% per year. The loan matures in May <br /> 2041. <br /> • Community Home Trust (CHT) bought the apartment complex on December 29, 2017 <br /> and assumed the loan from the County. <br /> • The balance of the capital structure for the Landings is as follows: <br /> ■ An AHP $1,440,000 First Loan originated by Bank of America with a 2% interest rate <br /> and matures in December 2030. <br /> ■ An AHP $550,000 Second Loan originated by Bank of America with a 7% interest rate <br /> and matures in December 2030. <br /> ■ An NC Housing Finance Agency (NCHFA) $4,995,112 loan, provided in lieu of tax <br /> credits with no interest and no payments required. The note matures in December <br /> 2025. If the property remains in compliance until that time, the note will be forgiven. <br /> ■ An NCHFA $332,997 Loan that matures in February 2040. The note bears no interest. <br /> ■ A United Housing Associates $250,000 Loan that is now assigned to Bank of America. <br /> This loan matures in December 2030 and the note bears no interest. <br /> • Community Home Trust (CHT) hired Partnership Property Management (PPM) as the <br /> property management company in January 2018. <br /> • When CHT acquired the property in 2017, the Operating Reserve was $81,938 and the <br /> Replacement Reserve was $85,352. <br /> • The expenses incurred that were paid from the reserves since CHT's ownership <br /> include the following: <br /> ■ $22,896.90 of operating reserves for property insurance in October 2018 <br /> ■ $9,743.66 of operating reserves to pay for a variety of normal maintenance activities, <br /> i.e. pressure washing and apartment turnover costs. <br /> ■ $17,794.69 of replacement reserves for miscellaneous replacements, i.e. appliances <br /> and sprinkler heads. <br /> ■ All transfers from both reserves were approved by the NC Housing Finance Agency <br /> (NCHFA). <br /> • CHT cites three (3)factors that caused the challenges being confronted. Those factors <br /> are: <br /> ■ The property lost money in 2015, 2016, 2017 and 2018. <br /> ■ Six (6) apartments were vacant when they acquired the property and vacancies <br /> remained high for most of 2018. However, by December 2018, there were only three <br /> (3) vacancies. <br /> ■ Some apartments, especially two (2), were very expensive to turnover and rent. <br /> • Based on an application from CHT, the Orange County Housing and Community <br /> Development Department provided $3,500 in Risk Mitigation funds in late <br /> January/early February 2019 for one of the aforementioned units. <br /> • The Town of Carrboro recently provided $30,000 of a $50,000 request. CHT will submit <br /> another request this spring for the remaining $20,000 needed. <br /> • The property management company, PPM, has worked hard to address the causes of <br /> the losses, i.e. reducing the vacancies and holding tenants accountable to their leases. <br /> The financial performance of the property was turning around at the end of 2018. As of <br /> today, there are only two (2) vacancies and the rental income is more stable. <br /> Robert Dowling, Executive Director of CHT, said he came to the Board in the fall of <br /> 2017, and did not think he would have to come back, but CHT does need more help, and he <br />