Preservation of Affordable Housing in Kansas Made Possible with CDFI Financing
Client: Fulson Housing Group
Client Location: Kansas City, KS
CDFI: Midwest Housing Development Fund
CDFI Service Area: Arkansas, Colorado, Iowa, Kansas, Minnesota, Missouri, Nebraska, Oklahoma, South Dakota, Texas
Technical assistance and long-term financing for affordable housing with support from the Finance Justice Fund
Founded in 2003, Fulson Housing Group is a successful model for affordable housing developers that has helped develop more than 2,800 affordable housing units. With approximately 85 employees, Fulson Housing Group is particularly successful at preserving existing affordable housing, such as Bethel Ridge in Kansas City, Kansas.
Originally constructed in 1972, the 64-unit Bethel Ridge property includes two three-story walk-up buildings and four two-story townhouse buildings. Located in the northwestern part of the city, the property is surrounded by family dwellings, and quality jobs and major services are located within walking distance, including a bank, shopping, restaurants, a salon, bus stop, health clinic, and a house of worship. Apartment amenities include in-unit washer/dryer hookups, balconies or patios, three playgrounds, and a leasing office.
Until its purchase in 2020, Bethel Ridge experienced low occupancy since previous owners lacked the cash needed for repairs and rehabilitation, leaving units unrentable. When Fulson Housing Group needed financing to acquire and rehabilitate Bethel Ridge, they turned to Midwest Housing Development Fund (MHDF), a community development financial institution (CDFI) based in Omaha, Nebraska, along with MHDF’s affiliate and low-income housing tax credit (LIHTC) syndicator Midwest Housing Equity Group (MHEG).
The Bethel Ridge property before (left) and after (right)
MHDF’s permanent loan provided necessary long-term financing at a longer amortization period and below-market rate that Fulson Housing Group couldn’t secure from other funding partners. These favorable loan terms are critical to ensuring long-term affordable rents and sustainable operations by the owners. In addition, the MHDF and MHEG affiliation provides ease of access to Fulson Housing Group as a single point of contact for both the LIHTC equity and MHDF loan, including technical assistance. Lower debt service payments provided by the terms of the MHDF loan contributes to the ability of owners to offer this substantial rent discount.
MHDF is proud to work with borrowers like Fulson Housing Group who are critical partners in the creation and preservation of affordable housing in the Midwest. Fulson Housing Group’s efforts show community members they are valued and deserve safe, desirable, affordable housing regardless of their income and background.
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