On June 26th Dulcie Claassen, Vice President and Director of Lending, represented WCRA at the Housing Development Consortium’s Public Funders Panel. This was a special opportunity for HDC members to hear directly from the largest public funders impacting affordable housing development in King County. In addition to WCRA, representatives from Seattle Office of Housing, A Regional Coalition for Housing, King County, Washington State Department of Commerce, and Washington State Housing Finance Commission also spoke. The notes from Dulcie’s presentation are below, and also available to download via PDF. For questions or more information, please call (206) 292-2922.
HDC Public Funders Panel
June 26, 2019
Presentation Notes by Dulcie Claassen, Vice President and Director of Lending at WCRA
Changes at WCRA
Blog
• Purpose: announce new programs and policies; reduce the number of email blasts from WCRA
Interest rates
• Have dropped!
• ½% to 1% lower than last year this time. Current rates for nonprofit forward rate-locked transactions:
3-year: 4.000
5-year: 4.125
7-year: 4.250
10-year: 4.375
20-year: 4.625
30-year: 4.875
• WCRA interest rates fluctuate weekly
WCRA is forming a new bond pool
• Previously bond transactions were sent out to member banks for optional participation only after loan committee approval.
• The new bond program will create a pool of funds in which members agree to participate based on Loan Committee approval
• Underwriting is based on our loan products
• Should be up and running this year
Capital Plus reminder and changes
• Partnership with the Commission – it is their funds and WCRA administers the program for them
• Program designed for small and emerging nonprofits that would have trouble securing financing on good terms elsewhere – think of nonprofits loosely here; CACs and Housing Authorities are eligible
• Commission approves borrowers for participation and WCRA loan committee must approve based on credit merits
• Sample properties: housing, museums, community centers, food banks, urban garden providing social services, neighborhood art center, owner-occupied office facilities for the nonprofit
• Can also do equipment financing
• Maximum loan amount recently increased to $750M for real estate
• No prepayment penalty!
• Real estate interest rate 4%, equipment rate 5%
Early Learning Center program coming
• WCRA has signed a $5MM contract with Department of Commerce
• Funding will be a combination of soft debt and grants
• In partnership with Enterprise and Craft 3
• Commerce funding is intended to complement other financing (such as WCRA economic development products)
• Program details are being worked out
• Please get in touch with me if you have a project to discuss
Things we do that folks may not be aware of or have forgotten
• Streamlined document program – construction lender must be one of our member banks
• Advantages are a single set of loan documents that provides an easier conversion to perm financing and no new appraisal at conversion to perm
• 2 year forward rate lock and loan commitment are available
• Acquisition/rehab and refinance/rehab
• Economic development loans. The project must serve a low-income population or be located in a low to mod income CT or other CRA targeted area.
• Examples are: commercial space within an affordable housing project, early learning centers, nonprofit office or operations space
• Short term loans: 3, 5 and 7 year loans have no prepayment penalty
• Manufactured housing communities: both resident-owned communities and non-profit owned
• Farmworker housing – both permanent and seasonal
• Last draw program – nonprofit borrowers can avoid the expense of a construction loan if public funds can cover the bulk of construction