Mixed-Income Development Hine School Redevelopment

(Brief) History Hine Junior High School closed after consolidation in 2009 District Disposition Prime metro-adjacent real estate across from Eastern Market Challenging PUD / Community Process / Appeal Broke ground in 2015, opened in 2017 and 2018

Program 162 Residential Units 53,000 sf of Retail (Including a14,000 sf Trader Joes and 5,000 sf of “affordable” retail) 156,000 of Office 328 Underground Parking Spaces

Economics – Market Rate Sources $63M Equity $147M Construction Loan $210M Total Uses $136M Constr. & FF&E $74M Soft Costs (Inc. $8M Sponsor Loan) $210M Total

Economics – Market Rate

Affordable Housing Component

Program 34 Residential Units (17 Family and 17 Senior Housing Units….yes, in one building) 10,000 Ground Floor and Lower Level Retail

Unit Mix

What’s so special about the structure???? Typical affordable housing in DC First Mortgage (Debt) 4%/9% LIHTC (Equity) DHCD Gap Financing Deferred Developer Fee Hine School (North Building) First Mortgage (Debt) 4% LIHTC (Equity) Sponsor Loan (South Building) No Deferred Developer Fee

Proforma True Cross-Subsidy!!

Why This Structure? Maximize affordable housing Preserve land value in market rate component Efficient Financing Execution(s)

Problems & Solutions

Primary Challenge: How can the developer meet the zoning requirement that half of the building would be for seniors? Solution…2 “twin” owners

Other Challenges: How do we reconcile competing demands of the District, the neighborhood, and lenders/investors concerning the commercial space? Solution… How do we structure the sponsor loan to satisfy interests of all parties? Solution… How do we structure the sponsor loan to avoid related party debt issues? Solution… How to allocate costs in a way that is acceptable to lenders/investors? Solution…

Is this model replicable…???