- Details
- By Chez Oxendine
- Real Estate
A new 50-unit affordable housing development is coming to Petoskey, Mich., providing housing for low-income families and tribal members in the area.
The Victories Square development is the result of a collaboration between Odawa Economic Development Management Inc. (OEDMI), the economic development arm of the Little Traverse Bay Bands of Odawa Indians, and California-based affordable housing provider Hunt Capital Partners. The collaboration also includes Troy, Michigan-based Community Housing Network (CHN), which will serve as the project’s developer.
The housing development will have studio, one- and two-bedroom apartments for households at 30 percent, 40 percent, and 80 percent of the area median income. Eight of the apartments will be set aside for tribal members, supported by rental assistance from the tribe. The other units will be available to tribal members as well as non-Natives in the community, including individuals who work for tribal enterprises.
The homes will feature dishwashers, microwaves, garbage disposals, washer/dryer connections, Energy Star kitchen appliances, LED lighting, walk-in closets, exterior storage, and central air conditioning. Residents will also have access to a community room, bike racks, on-site management, and Wi-Fi in all common areas. The development will meet National Green Building Standard Silver certification and comply with the Michigan State Housing Development Authority’s Green Policy Certification. Additionally, five units will be fully accessible, while the remaining units will be adaptable to future needs.
“Tribal communities are a historically underserved population and building affordable housing on tribal land helps to not only create opportunities for economic development, but also enriches the lives for many within the tribe through increased access to high quality housing,” Hunt Capital Partners Executive Managing Director Dana Mayo said. “Hunt Capital Partners is dedicated to collaborating with tribes…to offer safe, stable, and desirable housing choices for tribal families.”
Victories Square’s financing consists of a roughly $9.9 million equity investment from Hunt Capital, and $5.5 million in financing from OEDMI. Hunt’s financing will generate $13 million in total financial impact thanks to the Low Income Housing Tax Credit (LIHTC), an increasingly common financial mechanism in Indian Country housing, per prior Tribal Business News reporting.
OEDMI’s financing consists of funds from the Little Traverse Bay Bands and the federally recognized Shakopee Mdewakanton Sioux Community in Minnesota, as well as a loan from the Michigan State Housing Development Agency. The financing also includes a $448,000 Affordable Housing Program grant through the Federal Home Loan Bank of Indianapolis.
Hunt Capital Project Management Director William Teschke said this was the 14th such investment in housing alongside a tribal partner. Those deals haven’t usually included hard or foreclosable debt. Instead, the deals have been financed largely through equity from Hunt’s pool of investors, and then from tribal funding, making them attractive prospects for investment.
It’s also an advantage for some of Hunt’s investors, especially banks fulfilling their obligations under the Community Reinvestment Act (CRA). The CRA requires Federal Deposit Insurance Corporation-insured banks to meet the credit needs of their local communities. Per prior Tribal Business News reporting, tribal projects have become an avenue for banks hoping to improve their CRA evaluations.
The end result is a set of deals that help build sorely needed houses at relatively low financial risk, Teschke said.
“From a risk standpoint, these deals are great. They meet a huge need and create a huge benefit for tribes across the country,” Teschke said.
The development team will be led by CHN as the developer. MI-Oaks Construction, LLC, a joint venture between Miller Diversified Construction and Oakwood Construction Company, is the general contractor. Dimension IV Madison Design Group is the architect of record. KMG Prestige will provide property management.
OEDMI’s designated director, Leroy Shomin, said the Little Traverse Bay Bands is glad to see the development financing close, so the project can begin in earnest.
“We're definitely happy to have gotten this project to the close of the equity portion of it,” Shonin told Tribal Business News. “It's going to bring units to an area that sorely needs it. It's targeted to a market that most developers aren't targeting.”
The Victories Square housing project is part of a larger development effort that OEDMI has led in the region over the past several years, including a commercial development that includes a Marriott hotel, retail storefronts, and a tribal health clinic. There are also other housing projects that are “coming online” on the tribe’s reservation, Shomin said.
“The housing is going to have a big impact not just for the tribe, but for the whole area,” Shomin said.
