NMTC Case Study for FC Mission Plaza

Project

In the early 1980s, a group of University of Texas students created a local housing program for low-income families that would later turn into Foundation Communities (FC)—a local, homegrown non-profit dedicated to providing affordable, attractive homes and free on-site support services for thousands of families with kids, as well as veterans, seniors and individuals with disabilities.

In the decades since, FC has grown to develop, own and operate 23 residential communities all over Austin and in North Texas, providing over 5,600 Austinites with quality, affordable housing. By 2018, FC had outgrown its headquarters and Community Financial Center (CFC) in south Austin. To resolve that problem, FC identified a one-story retail building and a co-located four-story suburban office facility constructed in 1973 and 1974, respectively. The site is located in a Federal Promise Zone where the low-income community has 33.10% poverty and median family income at 39.92% of the wider metropolitan area.

After acquisition, FC will renovate the four-story building, taking over more than one full floor as its new headquarters. The remaining space in the four-story building will be leased to other non-profits, government and other office users. Collectively, these groups will provide services to over 17,000 low-income Austinites annually, including Communities In Schools assisting 5,000+ students overcome challenges to their educational success, and FC providing wrap-around services to 12,000+ low-income residents in their housing units.

Additionally, FC will use the one-story building as FC’s flagship financial services building in south Austin. This will be the largest of two Community Financial Centers which will leverage over 600 volunteers to help more than 20,000 Central Texans (i) file their tax returns free of charge each year; (ii) receive financial coaching and money management classes; (iii) enroll in healthcare through the ACA marketplace; and (iv) benefit from college, financial aid and career resources.

The Financing

The approximately $19.5 million dollar project was financed by FC, pairing permanent debt from BBVA Compass Bank with its own equity to fund a self-leveraged structure. NMTC equity was provided by US Bank, along with $12 million of New Markets Tax Credit Allocation provided by PeopleFund CDE based in Texas and $5 million of New Markets Tax Credit Allocation from MBS Urban Initiatives CDE.

TOTAL PROJECT COST:
$19,467,000

NMTC ALLOCATION:
$17,000,000

FINANCING COMPLETE:
May 2019

PROJECT SPONSOR:
Foundation Communities

CDES:
PeopleFund CDE / MBS Urban Initiatives CDE, LLC

NMTC INVESTOR:
US Bank

LEVERAGED LENDER:
Foundation Communities

ADDRESS:
2900, 3000 S IH 35
Austin, TX 78704

CENSUS TRACT:
48453002308

COMMUNITY OUTCOMES:
208 Direct Jobs
37,000+ LIC residents served annually

LOW-INCOME COMMUNITY:
Poverty Rate: 33.10 %
Median Family Income: 39.92% Federal Promise Zone
FEMA Disaster Area