1. Adding Value to New Orleans East
Old Morrison Homes
Adding Value to New Orleans East

2. Old Morrison Homes Old Morrison Homes Overview Earning Equity
Tax Credit Overview
Benefits of Development
VOB Tax Credit Experience
Community Partner Commitment

3. Old Morrison Homes Overview
36 Single Family Homes
21 3br ($800/mo) & 17 4br ($900/mo) Homes
1675 Average Sq Ft
$180,000 Cost/Home, ~$200k Average Retail Value
Lease-Purchase Program (65% minimum of payments will go toward purchase of home after 15 years)
Professional property management onsite, no absentee landlord
All tenants must meet strict criteria and be screened
3,000 sf Community Center will be constructed
Developers are responsible for all maintenance, taxes & property insurance over 15 year compliance period.

4. Earning Equity
Assume 2/3 (66%) of monthly payments will applied to the purchase price.
Assume monthly payments total $150K over the 15 year leasing period and price of home is $200,000.
Thus, in year 16 $100K (that is, 2/3 * $150K  $100K) is applied to mortgage principal of $200K.
Also after 15 years, only $100K remains to be owed on the home.
After 15 years, at an average increase of 2.5% in the valuation of the home (i.e. increased equity), the $200K home would be worth $289,000K.
Therefore, the resident with only $100,000 remaining on the mortgage principal would realize an equity in excess of $189K in year 16.(SEE TABLE)

5. Earning Equity (EXAMPLE)
Year
Value of Home (Assumption of 2.5% increase in value) 1
$200,000 2
$208,000
……… 15
$264,000 16
$289,000
In Year 16, resident owes ONLY $100,000 on home worth $289,000 Thus, resident earns $189,000 in equity in Year 16.

6. Old Morrison Homes Overview

7. Tax Credit Overview Purpose Process Income Requirements of Tenants
Property Management Guidelines
Onsite Management
Resident Acceptance Criteria
Community Development Opportunity

8. Resident Profile = Working Class
Occupation
Average Salary
Teacher
$31,000
Police
$35,500
Paralegals
$28,000
Retiree
$24,000
Fireman
$30,000
Office Workers
$25,000

9. VOB Tax Credit Experience
6 Tax Credit developments completed and under management in MS and TN
4 Tax Credit developments 90% complete in LA, MS and TN
4 Tax Credit developments under construction
4 Tax Credit developments in pre-development phase in LA and MS

10. VOB Tax Credit Experience
All existing properties are positive influences on neighborhoods
Example:
Riverbend – uptown area of Memphis
Tax Credit program was a component of huge economic growth
As residents moved in, New Markets Tax Credits and other revitalization investments were made

11. VOB Development properties
Chattanooga, TN
Memphis TN
Canton, MS
Jackson, MS
Baton Rouge, LA

12. Benefits of Development
New Development in N.O. East
Increased population to benefit retail revitalization
Lease-Purchase incentive program to spur home ownership
Lease-Purchase is great alternative tool given current economic conditions
Maintain/Increased value of avg home in area
Spurring economic development/jobs in area

13. Community Partner Commitment
Tenant Selection & Screening Process
Onsite Management – No Absentee Landlord
Home Ownership Education Program
Home Owners Association Partnership
VOB will continue reinvest in the New Orleans area
Core Old Morrison team is from N.O. East and is committed to its recovery

14. Adding Value to New Orleans East
Old Morrison Homes
Adding Value to New Orleans East