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Decatur to issue revenue bonds for senior housing projects in Decatur, Atlanta

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Decatur to issue revenue bonds for senior housing projects in Decatur, Atlanta

Doug Faust, executive director of the Decatur Housing Authority, addresses the assembled guests at the Grand Opening of Trinity Walk, the DHA’s redevelopment of the former Gateway Manor and Oakview apartments at 121 West Trinity Place in downtown Decatur. Seated behind Faust are (L-R): Fred Boykin, City of Decatur Mayor Pro Tem, Dakar Gibbs, Bank of America senior vice president and David Pedrick, Southface senior technical project manager. Photo by Judith Vanderver Photography

Decatur, GA — The Decatur Housing Authority will be taking on two senior affordable housing projects in Decatur and Atlanta. To complete the projects, the city of Decatur will issue revenue bonds by the Decatur Housing Authority for the acquisition, rehabilitation and operation of Philips Tower and Calvin Court.

The city commission approved the issuance of the bonds at its Sept. 6 meeting. The city will have no financial obligations for the bonds.

“We do not, shall not, will not ever have any kind of indebtedness because of these bonds,” City Manager Andrea Arnold said.

Philips Tower is located at 218 E. Trinity Place, and the multifamily housing bonds would be for $35 million. Philips Tower was built in 1971 and has 219 one-bedroom units. About 30 units may be converted to project-based vouchers.

Calvin Court is located at 479 E. Paces Ferry Road NE in Atlanta, and the multifamily housing bonds would be for $35 million. The property was built in 1970 and is made up of 116 efficiency units and 121 one-bedroom units. Ninety-two units are under a HAP Section 8 contract, and the remaining 145 units can be converted to project-based vouchers. About 130 units are expected to be eligible for the new project-based vouchers.

“The Housing Authority has a Housing Assistance Payments contract on each of the two properties. We don’t assist all the units, but we are able to assist about 125 in the Calvin Court project and about 25 here in Decatur,” DHA Executive Director Doug Faust said. “There are other subsidized units that HUD has a direct HAP contract on, and those units will all still continue to be affordable and still all be calculated at 30% of someone’s income.”

Since Calvin Court is located in the city of Atlanta, DHA will also have to get approval from the Atlanta City Council for the issuance of the bonds. The Decatur City Commission has to approve the bonds since DHA is based in Decatur.

“The IRS does require the governmental unit having jurisdiction over the issuer, which is the city commission…to approve the issuance of the revenue bonds. That’s even if the development or the project is outside of the city limits,” Arnold said.

Hallmark Development Partners and SCG Development Partners plan to renovate the property, including interior unit repairs and replacements, exterior work, and repairs and replacements in common areas. The developers have a preliminary budget of about $57 million for Philips Tower and about $60 million for Calvin Court, according to memos from Faust.

Presbyterian Homes of Georgia has owned and managed the properties as affordable housing for a while and will continue to do so long term.

The developers plan to apply for low-income housing tax credits for both projects. They will also utilize debt financing through the U.S. Department of Housing and Urban Development for the acquisition, renovation and continued operation of the properties.

“We’re excited to do these two projects. It allows us to preserve affordable housing. These two properties are aging, and they need to be rehabilitated,” Faust said at the city commission meeting. “It’s going to allow seniors to continue to live both here in Decatur and in the city of Atlanta.”

In other business, the city commission also amended a grant award from the tax allocation district No. 1 to support the Decatur East Phase II project. The board changed the grantee of the funding from Decatur East Phase II, LP to the Decatur Housing Authority.

The amendment was approved, with four commissioners voting in favor and Commissioner Lesa Mayer abstaining from the vote. Columbia Residential secured Truist Community Capital as the investor for the project. Mayer works for Truist.

The city commission previously allocated $438,100 in grant funding from the TAD to Columbia Residential to cover infrastructure costs for the senior affordable housing project.

The grant was conditioned upon an award of low-income housing tax credits, Arnold said.

The project team of Columbia Residential and DHA was awarded an allocation of 9% low-income housing tax credits from the Georgia Department of Community Affairs.

“Due to the structure of a standard Low-Income Housing Tax Credit transaction and the tax consequences that structuring the grant directly to Decatur East Phase II, LP will create, effectively lowering the net grant award, we respectfully request that the City amend the grant award and change the recipient to the Housing Authority of the City of Decatur, Georgia (DHA),” said Jim Grauley, CEO of Columbia Residential, in a memo.

Columbia Residential and DHA are working together to development Decatur East Phase II, which will be 80 units of senior affordable housing.

The development will be located at the corner of Freeman and Sams Streets near the Avondale MARTA station.

Columbia residential completed Phase I in 2018, which was a 92-unit mixed-income senior community. The developers are now working on Phase II of that project, and all units will be for seniors aged 62 and older.

“This is planned to be an 80-unit senior community, with 70 of those units restricted as affordable, and that’s at 50% or 60% of the area median income. In addition, there’s 24 project-based vouchers that will help support lower income residents to reside here,” said Christina Davis, development manager with Columbia Residential, at the Nov. 15 Decatur City Commission meeting.

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