1. Presented By: Karen Fortin Danny Gordon
Concept Meetings
Presented By:
Karen Fortin
Danny Gordon

2. What will we be going over?
Initial Contact for Concept Meeting
Where will the meeting be?
General Information
What does each HUD team member do?
What happens after the concept meeting?
Common Concept Meeting Responses

3. Initial Contact
Generally the Underwriter Analyst (UA) is sent a stating that a concept package is in the mail from the lender.
Upon receipt of the concept package (2 Hard copies and 1 Flash drive) UA verifies that the package is complete.
Once verified, the UA contacts lender with potential dates and times for the concept meeting.
Once the lender selects a date and time UA schedules the meeting and sends out the invites to the HUD team and lender.

4. Where will my meeting be held?
Atlanta Office: North Carolina, South Carolina, Georgia, Kentucky, Tennessee and the Caribbean.
RAD: Regardless of state.
Jacksonville Office: Florida, Alabama, and Mississippi.

5. General Information
Concept Meetings are scheduled on Tuesdays and Thursdays, with Wednesdays being the overflow day.
Meetings can be held in person, via teleconference or a mix of both.
The HUD team: Chair, Underwriter, Appraiser, Construction Analyst, Asset Manager, EMAD, Underwriter Analyst.
The Appraiser, Construction Analyst, EMAD, and Asset Manager all have the choice of sending in comments prior to the meeting or coming in to participate in the meeting.

6. General Information Cont.
Concept meetings are scheduled for 1 hour but that does not mean they must last the entire hour.
1 Hard copy stays with the Underwriter Analyst and the other hard copy will be given to the Chair of the meeting.
We encourage teleconference concept meetings.
The response letters need to be sent out within 5 days after the concept meeting according to the MAP Guide.

7. What does each member of the team do?
Underwriter/Chair
Appraiser
Construction Analyst
Asset Manager
EMAD

8. Underwriter Mortgage Credit: Focus on HUD-92264 and HUD-92013.
Owner, Construction Company, Architect, etc.
Do they have enough capital and prior HUD experience?
Have they worked with the proposed Owner/Lender/Architect before?
Pre-Application or Straight to Firm Application?
Unique financial issues such as a Bridge Loan?
Bridge Loan reference MAP Guide Chapter 8.

9. Appraiser Expenses for project, are they reasonable?
Project located in a Flood Plain or Wetlands? 8-step process may be needed.
This 8-step process can be very time consuming and could potentially delay processing.
Cost per square foot.
Located on HUD section G.
Is the project located in fall zone?
New construction cannot occur in a fall zone.
Any other environmental issues?
Such as noise or radon?

10. Construction Analyst
Ground lease? Is a waiver needed for the Ground lease?
7.15 MAP Guide
Relocation Plan needed?
Other disciplines would look at this as well.
Potential Seismic Activity?
Puerto Rico and Virgin Islands.
UFAS (Uniform Federal Accessibility Standards)

11. Asset Manager Know of any similar properties in the area?
If so, how are those properties doing?
Management Agent
Any flags?
Has the Asset Manager worked with them before?
Is the project already in HUDs portfolio?
If so, what is latest REAC score?
Is property having issues or doing well?

12. Economic and Market Analysis Division (EMAD)
Supply and Demand
Adequate demand must be established for the project.
Should project be built at once or in multiple phases for adequate absorption rate?
Is there any current construction of similar properties in the county?
What are vacancy rates at all types of properties in area?
How is job growth, general economic conditions in the county?
What is the population in the county?
Is it mostly elderly/students/military/etc.?

13. What happens after the meeting?
The Underwriter Analyst will write up the response letter and send that to the Chair of the meeting.
The Chair will then have a quick meeting (if needed) with the branch chief and production division director to decide whether to encourage or discourage the concept.
Once that decision is made the Chair will send out the response letter via .
Once the letter is sent out it is added to the electronic file and the hard copy is filed away.

14. What are some Common Concept Meeting Responses?
There are some issues that come up often during concept meetings. Such as: Unit mix, Expenses, Access/Easement Agreements, Environmental, Management Company, EMAD, Choice limiting actions, Straight to Firm, Age Restricted, and Fall Zones.
Example responses of each to follow.

15. Unit Mix
Have the Appraiser and Market Analyst thoroughly vet out the proposed unit mix to confirm that this would be the best possible unit mix for the property.

16. Expenses
Expenses for this project are lower/higher than is typical for this type of project, be sure this is addressed in the appraisal report.

17. Access/Easement Agreements
Access easement agreements will be needed for the shared entrance, parking lots, and club house located on the property.

18. Environmental
All potential environmental issues must be accounted for, including but not limited to: noise, radon, flood hazard areas, wetlands and fall hazards. In the event that any flood zones or wetlands may be impacted by improvements, the environmental 8-step process must be followed and adhered to.
NEW CONSTRUCTION/SUB REHAB

19. Management Company
The Departments Asset Manager recommended using a management company with HUD experience or hiring a consultant for a minimum of one year to work with the management company proposed in the concept package.

20. Economic and Market Analysis Division (EMAD)
EMAD mentioned that several new apartment projects have been completed in the last two years and there is a significant number of units under construction in the county. Any prospective application should pay attention to the development pipeline and current vacancy rates at existing comparable properties.

21. Choice Limiting Action
The department wanted to ensure that no demolition is conducted on the property from the point of engaging HUD in this Concept Meeting.  Performing any work on the property after having this Concept Meeting may be considered a “choice limiting action” and could potentially impact HUD’s ability to conduct a full and comprehensive environmental assessment and review.  The project may be out right rejected if any work is conducted on site beyond the date of this Concept Meeting.

22. Straight to Firm/Skip Pre-App
It is recommended that a pre-application be submitted rather than go straight to firm due to the substantial risk associated with a straight to firm application.
Map Guide 4.2 B.
The lender may request to skip the Pre-application stage to go directly to Firm Commitment application. Lenders should only consider such requests for projects in strong markets, where the lender and borrower acknowledge in writing the risk of a rejection and that the application fee is nonrefundable, so long as there are no environmental issues, and the lender, borrower, and development team members have previous positive experience with FHA Multifamily financing.

23. Head of Household/Age Restricted
This project is proposed to be a 62 plus head of household project. Please note Map guide page 176 section J.4:
For age restricted properties, the market analyst must describe the intended occupancy regime. The MAP Lender’s underwriter narrative must ensure that the analysis and owner’s intent based on their representations comply with FHA program guidance and Fair Housing law.

24. Fall Zone/High Voltage
There are overhead high voltage transmission lines located on the property. Please refer to Map Guide Chapter 9.5.P as far as HUD’s regulations regarding high voltage transmission wires and fall zones.

25. Any Questions?

26. Thank you everyone, for your time and attention today.