1. Rental Assistance Demonstration (RAD) Overview
Moderator:
Terri Anderson, Anderson Development & Construction, LLC
Panelists:
Don Bernards, Baker Tilly Virchow Krause, LLP
William Lavy, HUD
Catalina Vielma, National Equity Fund, Inc.
Mark Ragsdale, PNC Real Estate
Jeff Weiss, Alden Torch Financial LLC

2. Background The Solution The Problem
Deferred public housing capital repair needs estimate in excess of $25.6B across the portfolio (>$23k per unit)
Public housing platform creates barriers to accessing private capital
10,000-15,000 public housing units lost each year
Multifamily “legacy” program properties at risk of loss of affordability
The Solution
RAD created in FY2012, expanded in FY2015 & FY 2017
Allows public housing and at-risk legacy properties to convert to long-term Section 8 Housing Assistance Payment (HAP) contracts
HAP contracts facilitate new financing and preserve affordability
Background

3. RAD Program Structure
Rent Supplement
Rental Assistance Payment
Public Housing
Section 8 Moderate Rehabilitation
McKinney Vento Single Room Occupancy (SRO)
RAD Conversion
PBRA
(Section 8 Project-Based Rental Assistance)
PBV
(Section 8 Project Based Voucher)
Program rules set forth in PIH Notice Rev 3

4. Status: Public Housing Conversions
63,765 public housing units converted from Public Housing to Section 8
$4.07 Billion (>$60k per unit) in construction investment
PHAs would have needed 46 years to accumulate enough public housing Capital Funds to complete a similar amount of construction.
39,000 Construction Trade Jobs generated and an additional 36,000 indirect jobs induced in the surrounding local economies.
225,000 Units awarded/reserved under the existing cap (recently increased by 40,000 units in FY 17 Approps Act)
29,000 units on the waiting list

5. Financing Public Housing Conversions
44% of transactions involve significant work – from $25K to new construction
42% of transactions involve either 4% LIHTC or 9% LIHTC
A major driver of the deeper-investment transactions, particularly those using 4% LIHTC, is accessing the value of the existing real estate (most significantly, by tapping into acquisition credits).
* Data through June 16, 2017.
PH RAD Status

6. Status: Legacy Program Conversions
Conversions & Outstanding Pipeline
Rent Supp/RAP Transactions:
33 properties remaining in portfolio
21 active transactions in the RAD 2 Pipeline
17 properties have contracts that expire in 2017
We hope to wind down the Rent Supp & RAP programs in the next few years
Mod Rehab Transactions:
9 active transactions in the RAD 2 Pipeline
3 applications in process
Substantial opportunities for Mod Rehab properties
NOTE: Data derived from RAD 2 closed transactions only through June 15, 2017.
Legacy Program Conversions

7. FY 18 Budget Proposals
Eliminate the cap on the public housing units that can convert at no cost and eliminate application deadline
Allow Section 202 Project Rental Assistance Contracts (PRACs) to convert under 2nd Component at no cost
Authorize a tenant’s right to continued occupancy under the 2nd component
Align ownership and control requirements in tax credit partnerships and in the event of foreclosure, bankruptcy, or default with baseline standard