Louisville Housing Authority Agenda and Packet 2012 03 13

Home Browse Search

> To identify properties to be considered for sale due to operational difficulties or to be recapitalized to facilitate new development or acquisition activities in furtherance of the LHA mission; and > To identify properties suited for combining in a new low - income housing tax credit financing. Portfolio Analysis Process Historic Financial and Operating Results: S.B. Clark Companies initiated the analysis process by reviewing and evaluating information for all LHA properties as recorded on the Authority's accounting systems for 2008, 2009 and the 2010 calendar years. Additionally, BCHA staff provided property operating information as to number of units, rent levels, subsidy rent support, estimated capital improvements and a property basis. The firm also reviewed the past audited financial statements of the Authority. Master Combining Property List: Next, S.B. Clark Companies prepared the Master Combining Property List (see Exhibit 1). This list presents for each property: the property name, address, location, property type (as senior or family), number of units, bedroom range, outstanding debt, net operating income (FY 2010), estimated value (capitalization rate at a 6.50% cap rate), first mortgage loan --to- value, current debt service coverage ratio, per unit per annum operating expenses (PUPA), and estimated capital needs. This combining list was created from detailed financial analyses of each property with historical operations from 2008, 2009, and 2010. Such detailed property operating information is presented in Appendix A. Additionally, a Long Term Debt Summary was prepared to present first mortgage debt and sub -debt as are understood from the financial analyses (see Exhibit 2). Hillside Square Proforma: With the knowledge that the Authority has the option of applying to HUD's Special Applications Center to attain "disposition" for the 13 units of Public Housing at Hillside Square, S.B. Clark Companies presents proforma operating statistics and debt capacity for Hillside assuming such a disposition. This proforma analysis assumes LHA applies for and receives Section 8 vouchers for the existing tenants. Preliminary Conclusions for Discussion Agency -wide Conclusion — Operating Efficiency. Generally, LHA housing properties are operating to meet the mission of the providing affordable housing to low income Louisville residents, The size of the property portfolio is small and generally the number of units at each property is less than 30. These factors limit opportunities for operational efficiency. Any opportunity for consolidation of the properties in a larger system or even acquiring /developing new property near existing units can offer opportunity for operational efficiency. Louisville Housing Authority Page 3 Portfolio Analysis Summary Report 18