1. STRUCTURING MULTIFAMILY BOND ISSUES IN THE CURRENT MARKET NEW DEVELOPMENTS IN MULTIFAMILY FINANCE MAY 20, 2011 2011 ANNUAL CONFERENCE ANSEL CAINE VICE PRESIDENT

2. RECENT HFA BOND STRUCTURES 2 FHA-RISK SHARING FHA/GNMA FREDDIE MAC CREDIT ENHANCEMENT DIRECT LENDING

3. 3 GOALSRefinance HFA-Owned Property with Minimal Debt Provide Fund for Rehabilitation of 134 Affordable Units in Issuer-Owned and Operated Property Provide Funds for Other Affordable Housing Endeavors SIZE$12,375,000 BOND TYPEPublicly Offered, Non-AMT, Fixed Rate, Governmental Bonds BOND STRUCTURE FHA Risk-Sharing Credit Enhanced Mortgage Loan Level Debt, 18-Month Construction Period, 30-Year Permanent Financing SECURITYAaa Rated Parity Bond Indenture FHA Risk Sharing Insurance, GNMA Securities and GSE Credit Enhancement $292 Million of Outstanding Parity Bonds Secured PARITY FHA RISK-SHARING INDENTURE

4. 4 GOALSRefund Existing Tax Exempt Bonds Under Parity Indenture Reduce Interest Rate Reduction to Borrowers Preserve Affordable Housing Increased Income to HFA SIZE$77,705,000 BOND TYPEPublicly Offered, Non-AMT, Fixed Rate, Private Activity Bonds BOND STRUCTURE Economic Refunding of AMT to Non-AMT Refunded Five Existing Bond Series Financing 23 Mortgage Loans with FHA Risk-Sharing Structured to Match Remaining Amortization of 30 and 40-Year Components SECURITYAaa Rated Parity Bond Indenture FHA-Risk Sharing Insurance $155 Million of Outstanding Parity Bonds Secured PARITY FHA RISK-SHARING INDENTURE

5. 5 GOALSProvide Funds for New Construction of 195-Unit Multifamily Development (113 Market Units and 82 60% AMI Units) BOND TYPENIBP Rollout, No Market Component, Non-AMT, Fixed Rate, Private Activity Bonds BOND STRUCTURE Standard CLC/PLC Structure Construction-Phase Letter of Credit Level Debt, 2-Year Construction Phase, 39-Year Permanent Financing SECURITYAaa Rated GNMA Securities OTHER SOURCES Tax Credit Equity FHA/GNMA WITH NIBP

6. 6 GOALSProvide Funds for 96 Affordable Housing Units (50% AMI or Lower) in Downtown Suburban Area SIZE$12,900,000 BOND TYPE58% NIBP Rollout, 42% Market Component, Non-AMT, Fixed Rate, Private Activity Bonds BOND STRUCTURE Freddie Mac Guarantee Construction-Phase Letter of Credit SECURITYAaa Rated Freddie Mac Credit Enhancement OTHER SOURCES Subordinate HFA Bonds Sold via Private Placement Subordinate Loan from Municipality Tax Credit Equity FREDDIE MAC CREDIT EHANCEMENT WITH NIBP

7. 7 GOALProvide Funds for 209-Unit Multifamily Housing Development in Downtown Urban Area SIZE$23,488,000 BOND TYPEPrivately Placed, Private Activity Bonds BOND STRUCTURE 6.0% Loan with Tax Credit Financed Rate Reduction SECURITYDevelopment (Not Rated) OTHER SOURCES Subordinate Loan from Municipality Tax Credit Equity BANK PRIVATE PLACEMENTS

8. Ansel Caine, Caine Mitter & Associates Incorporated Phone: 212-686-8820 Email: acaine@cainemitter.com Wrap Up 8 Landscape of multifamily bond structures has changed somewhat in recent years Parity indentures can provide HFA with additional flexibility Financing structure will depend on the specific goals of the financing