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Estrella Landing (1)
Exhibit A.2 - Merchants - EL Letter of Interest_Tax Credit Equity 2022-07-21.pdf Microsoft Word - Letter of Intent Governor Park Apartments - Final Draft.docx 1 July 21, 2022 VIA E-MAIL/PDF Stephanie Norris Terroir Development, LLC 4837 Carolina Beach Road, Suite 110 Wilmington, North Carolina 28412 Mailing: PO Box 15025 Wilmington, North Carolina 28408 RE: Estrella Landing – Wilmington, North Carolina Dear Ms. Norris: Merchants Capital Investments, LLC, a subsidiary of Merchants Bank of Indiana, an Indiana banking company (“Merchants”) or its assignees is please to make the following non-binding proposal for equity financing related to an affordable housing development as further described below. The parties will use this proposal to negotiate an amended and restated limited partnership agreement or limited liability company agreement, as applicable (“Equity Agreement”). The terms outlined and summarized in this letter are contingent upon and subject to Merchants’ Investment Committee approval. Merchants reserves the right to update and adjust this Letter of Interest to reflect any changes in the following information and assumptions discovered during the due diligence and underwriting review. A. PROJECT: The Project, located in Wilmington, North Carolina will have 84 units available to families for rent. Within the project, 84 units will be occupied in compliance with Federal low-income housing tax credit (“LIHTC”) requirements of Section 42 of the Internal Revenue Code of 1986 (the “Code”). B. TAX CREDIT AMOUNT: $941,391 in annual credits, per a valid reservation, allocation or determination. C. EQUITY AMOUNT: $8,471,672 a. Equity Amount per Tax Credit Dollar: $0.90 D. MATERIAL PARTICIPANTS: a. Project Owner: Estrella Landing Apartments, LLC b. General Partner: Terroir Development, LLC or affiliate 2 c. Developer: Terroir Development, LLC d. Investor: To-be-formed MCI Investor Entity (“Investor”) e. Property Manager: Norco Management Holding, Inc. f. Guarantor: Stephanie Norris and Joan Norris, as individuals, and the Developer. E. KEY DATES: a. Closing Date: 12/1/2022 b. Construction Start: 3/1/2023 c. Completion Date: 12/31/2024 d. Qualified Occupancy Date: 4/1/2025 e. Stabilization Date: 8/1/2025 f. 8609s: 8/1/2025 F. CAPITAL CONTRIBUTIONS: The Investor proposes to make Capital Contributions to the Project Owner on the following schedule, upon the achievement of prescribed benchmarks and satisfactory evidence or approval of certain conditions, to be more fully described in the Equity Agreement. The Investor’s Capital Contribution will be subject to reduction and adjustment, including for shortfalls in Tax Credit delivery and eligible basis at the Adjuster amounts as set forth above). Reductions in Capital Contributions, if any, will occur initially at the current, and if necessary, future Capital Contributions, and will be guaranteed by the Guarantor. In the event the actual Tax Credits exceed the projected Tax Credits, the Investor shall be under no obligation to increase its Capital Contribution to invest in those excess Tax Credits, but may elect to do so, in its sole discretion. Installment: Amount: Anticipated Conditions: First (Closing) $847,167 (10%) Closing of all financing and completion of all initial due diligence. Second (Completion) $5,063,003 (60%) 100% lien-free Construction Completion. Third (Perm Loan Conversion) $2,130,872 (25.2%) Closing of permanent financing and commencement of amortization thereof and mandatory debt service payments Fourth (Stabilization) $205,315 (2.4%) Stabilization - Later of 93% Economic Occupancy and 100% Qualified Occupancy and DSCR of 1.15 Fifth (Final) $205,315 (2.4%) Receipt of Form 8609’s for all buildings. 3 G. PERMANENT PROJECT SOURCES: Thank you for your consideration and we look forward to the opportunity to work with you. Very truly yours, Estrella Landing - County WHSP Proposal 2022-07-29.pdf TERROIR DEVELOPMENT, LLC P.O. BOX 15025 ♦ WILMINGTON, NORTH CAROLINA 28408 ♦ OFFICE 910.791.3354 New Hanover County RFP - Workforce Housing Services Program PROPOSAL July 29, 2022 Applicant Name: Estrella Landing Apartments, LLC Type of Applicant: For-Profit, Limited Liability Company Applicant Established Date: 9/9/2021 Organization Principal (Managing Member): Terroir Development, LLC Stephanie L. Norris, Manager PO Box 15025 Wilmington, North Carolina 28408 Office: (910)791-3354 Mobile: (919)669-1079 Email: stephanie@norcomanagement.com Terroir is a 100% Woman-Owned Business. 2 Project Summary: Name: Estrella Landing Apartments Property Location: 4615 Gordon Road, Wilmington, NC 28411 Total Development Costs: $18,233,226 (REF. Exhibit A – Development Budget with 20-YR) WHSP Funding Request: $ 1,500,000 20-Year Term / 20-Year Amortization / 2% Interest Debt Service paid annually from available, net cash flow after the Financial Audit is approved by the Equity Investor. Funding Sources: (REF. Exhibits A.1 to A.4) Funding Source Type of Funding Amount Rate Term Merchants Capital Corp. Permanent Loan 4,508,710 6.25% 15/40 years NCHFA CDBG-DR Loan 2,500,000 0 20/20 years Merchants Capital Investments Tax Credit Equity ($0.87) 8,189,283 N/A 15 years New Hanover County WHSP Loan 1,500,000 2% 20/20 years NCHFA WHLP-CV (Requested) 1,535,233 0 20/20 years Total Funding Sources: $18,233,226 Note: Exhibit A.2 – Merchants Capital Investments is a Letter of Intent for the purchase of the Tax Credits with a Tax Credit Price of $0.90. If the Tax Credit Equity closes at this price, the WHSP Loan amount could potentially be reduced. Similarly, if the WHLP-CV request increases, the WHSP Loan amount could potentially be reduced. 3 Project Type: New Construction of an 84-unit community to serve Low and Very Low Income Families and Seniors in New Hanover County. Project Narrative: Estrella Landing Apartments is located in a high-growth area on the north side of New Hanover County, where new residential communities have been recently completed and others are under construction. The site is near the I-40/Gordon Road interchange, which offers great access to all parts of the Cape Fear Region and beyond. The development will consist of 84units within three (3), 3-Story buildings: 13 - 1 Bedroom Units, 35 - 2 Bedroom Units and 36 - 3 Bedroom Units. The Clubhouse will include the Site Manager's Office and Resident Community Space. Interior features of each apartment will include: Energy Star appliances, Washer/Dryer hookups, Ceiling Fans in the living and bedrooms, Exterior Storage Areas, among other features. We intend to use a wood plank Luxury Vinyl Tile (LVT) to enhance and update the interiors of the apartments. Brick and Fiber-Cement Siding will be used to achieve long-term use and durability while keeping maintenance costs manageable. The architectural design and details rival any high-end, market rate apartment community. Rent Structure with Target Income Limits: (REF. Exhibit A – Development Budget) Unit Type Number of Units Rent Area Median Income 1 BR/1 Bath 3 335 30% 1 BR/1 Bath 10 745 60% 2 BR/2 Bath 9 410 30% 2 BR/2 Bath 26 900 60% 3 BR/2 Bath 9 480 30% 3 BR/2 Bath 27 1000 60% Note: The Target Income Limits were set by NCHFA with the 2021 QAP, which required the use of the 2020 HUD Rent and Income Limits. The Rents referenced above are taken from the Rent Structure in the NCHFA Final/Approved Application and may be increased prior to the Lease-Up phase. Regardless, the Rents will comply with HUD requirements in effect during the LIHTC Compliance Period and extended period of affordability. HUD Housing Choice Vouchers, administered by the Wilmington Housing Authority, will be accepted at Estrella Landing. In our existing New Hanover County LIHTC communities (Lockwood Village Apartments and Bennett Village Apartments), approximately 12% to 20% of the Residents have a HUD Voucher. Estrella Landing has been designed to provide handicap accessibility to all buildings and amenities within the site. A total of 10 units will be accessible for mobility and audio/visually impaired residents. The remaining ground floor units will be adaptable. The property will remain affordable for 15 years through the LIHTC, IRS Section 42, Compliance Period, which starts the day the property is placed in service. There will be an additional 15 years of affordability beyond the initial Compliance Period for a total of 30 years. The WHSP funds will assist with increasing the affordable housing stock, while maintaining affordable rents for the residents in New Hanover County. 4 Project Schedule: (REF. Exhibit A.2 – Merchants Capital Letter of Intent) (REF. Exhibit C Items) Based on the current status of the plan reviews with various agencies and permits received to date, we expect to accomplish the tasks below on or by the dates referenced. August 2022 Purchase of the Estrella Landing Site December 2022 Tax Credit Equity and Construction Loan Closing March 2023 Construction Commencement December 2024 Construction Completion and WHSP Loan Disbursement January – April 2025 Lease Up Generally when Construction is complete, our Accountants (Bernard Robinson) will complete a draft Final Cost Certification to account for every Source and Use. The General Contractor will submit Lien Waivers for their work, including all subcontractors and vendors. The Equity Investor reviews this data to approve the release of the Construction Completion Equity Installment. The same data can be provided to the County for the WHSP Loan Disbursement, which will be used to pay down the Construction Loan balance. Development & Management Team: (REF. Exhibit B Items) Terroir Development, LLC, is the Managing Member of Estrella Landing Apartments, LLC. Although the Equity Investor will own 99.99% of the interest in Estrella Landing, Terroir will be 100% responsible for tax credit compliance and reporting to the Investor. The Members of Terroir are Stephanie L. Norris (Manager) and Joan O. Norris, both of which will be required to execute personal guarantees for the delivery of the tax credits (Construction Completion Guaranty) and a Tax Credit Compliance Guaranty for the 15-Year Compliance Period. Norco Management Holding, Inc., will be the Property Management Firm of Estrella Landing. The Owners of Norco are Joan O. Norris (President/CEO) and Stephanie L. Norris. Norco provides property management services to the 26 affordable housing communities owned by Joan and Stephanie through various development entities. Terroir and Norco are Wilmington-based businesses, and the Members/Owners are New Hanover County residents, who have a vested interest in improving our Community. Development Quality: (REF. Exhibit D Items) We encourage the County Commissioners and Staff to tour Bennett Village and Lockwood Village located in New Hanover County. Both properties were developed and are owned and managed by the above referenced team. The architectural style and building materials used for Bennett Village will be replicated at Estrella Landing. Exterior building materials include 30-year anti-fungal architectural shingles, brick, fiber-cement siding and band boards for cost-effective maintenance. Interior Unit features include luxury vinyl planks, stainless steel appliances, and unit floorplans that are comparable to market rate apartments. 5 Exhibits: Exhibit A: Development Budget with 20-Year Proforma (Financial Feasibility) Exhibit A.1 NCHFA LIHTC Allocation and Final/Approved Application Exhibit A.1.1 NCHFA 2021 LIHTC Exchange Letter dated 5/16/2022 Exhibit A.1.2 Estrella Landing Project Update to NCHFA dated 5/26/2022 Note: The Project Update reflects Construction Costs as of May 2022 and includes a request for WHLP-CV Relief Funds from NCHFA, prior to the announcement of the County RFP. This information is reflected in the Exhibit A – Development Budget and the Funding Sources referenced above. Exhibit A.2 Merchants Capital Tax Credit Equity Letter of Interest Exhibit A.3 NCHFA CDBG Loan Conditional Commitment Exhibit A.4 Merchants Capital Permanent Loan Preliminary Commitment Exhibit B: Terroir Development, LLC, Mission Statement and Member Experience Exhibit B.1 Member Resumes Exhibit B.2 Norco Management Holding, Inc., Real Estate Schedule Exhibit C: County TRC Approval Letter and signed Plans dated 6/30/2022 Exhibit C.1-C.3 County Land Disturbance, Tree Removal and Floodplain Permits Exhibit C.4 NCORR Notice to Proceed and HUD Environmental Clearance Exhibit C.5 US Army Corp of Engineers Nationwide Permit Exhibit C.6 NCDEQ Water Quality Certification Exhibit C.7 NCDEQ Sanitary Sewer Permit (Private) Note: NCHFA commissioned a Market Study in March 2021, after the Preliminary LIHTC Application was submitted. During the HUD Environmental Assessment, a Phase I ESA was completed in October 2021. A Subsurface Investigation was completed in March 2022. All of these reports can be available for review, if needed. Exhibit D: Architectural Plans prepared by Martin Riley Associates-Architects, PA, currently in County Building Permit review Exhibit D.1 Photo Sheet of Bennett Village Apartments Exhibit A - EL Development Budget with 20-Year Proforma.pdf Wilmington New Hanover County TIE BREAKER: 112,070 Income Designation: High MEDIAN INCOME 72,800 Number of Units 84 Unit 30% 40% 50% 60% 65% 75% 80% HOME Property Type Family Breakdown 21 0 0 50 0 0 0 East Projected Range 127,370 $ 137,984 $ Average 132,677.21 $ Sq Ft Size # units Rent UA MHE HH ADJ AFFORD. % Median INCOME Maximum Housing Allowance Set Aside 757 1br/1bth 3 335 62 397 0.75 15,880 29.08% 12,060 410 30% 757 1br/1bth 0 0 62 62 0.75 2,480 4.54% - 546 40% 757 1br/1bth 0 0 62 62 0.75 2,480 4.54% - 567 HOME 757 1br/1bth 0 0 62 62 0.75 2,480 4.54% - 683 50% 757 1br/1bth 9 745 62 807 0.75 32,280 59.12% 80,460 819 60% 1027 1br/1bth 1 745 62 807 0.75 32,280 59.12% 8,940 887 60% 757 1br/1bth 0 0 62 62 0.75 2,480 4.54% - 1,092 80% 1026 1br/1bth 0 0 62 62 0.75 2,480 4.54% - 1,092 80% 1027 2br/2bth 9 410 77 487 0.9 19,480 29.73% 44,280 491 30% 1027 2br/2bth 0 0 77 77 0.9 3,080 4.70% - 655 40% 1027 2br/2bth 0 0 77 77 0.9 3 ,080 4.70% 681 HOME 1027 2br/2bth 0 0 77 77 0.9 3 ,080 4.70% - 819 50% 1027 2br/2bth 26 900 77 977 0.9 39,080 59.65% 280,800 983 60% 1027 2br/2bth 0 0 77 77 0.9 3,080 4.70% - 1,065 60% 1027 2br/2bth 0 0 77 77 0.9 3,080 4.70% - 1,147 70% 1027 2br/2bth 0 0 77 77 0.9 3,080 4.70% - 1,310 80% 1185 3br/2bth 9 480 93 573 1.04 22,920 30.27% 51,840 568 30% 1185 3br/2bth 0 0 93 93 1.04 3,720 4.91% - 757 40% 1185 3br/2bth 0 0 93 93 1.04 3,720 4.91% - 786 HOME 1185 3br/2bth 0 0 93 93 1.04 3,720 4.91% - 946 50% 1185 3br/2bth 15 1000 93 1093 1.04 4 3,720 57.75% 180,000 1,136 60% 1204 3br/2bth 12 1000 93 1093 1.04 43,720 57.75% 144,000 1,136 60% 1185 3br/2bth 0 0 93 93 1.04 3 ,720 4.91% - 1,325 70% 1185 3br/2bth 0 0 93 93 1.04 3,720 4.91% - 1,514 80% 1536 Community Building 84 802,380 DEVELOPMENT COST OPERATING BUDGET 1 Misc. Items - Advertising 1,000 2 Demo Office Suplies 4,000 3 Misc. - Lift Station - Management Fee 46,500 4 on site improvs (Land Option) 0 2,449,000 29,155 Manager Salaries 35,000 5 new construct Per Unit 108,093 8,839,844 99.38662529 Legal Expenses 2,000 6 Acc Bld 240,000 Construction Contract 14,114,764 Auditing Expense 9,000 7 general reqs 6% 691,731 Bookkeeping Fees - 8 overhead 2% 244,411 Telephone 6,000 9 profit 8% 977,646 Other Exp. 5,200 10 contingency 5% 672,132 37,156 Utilities (Water, Sewer & Electric) 77,000 11 Water/Sewer Tap Fees 107,720 Exterminating 6,000 12 architect design 277,140 Trash Removal 10,000 13 architect supervision 12,000 Grounds Contract 22,000 14 RE atty 35,000 Maintenance Payroll 28,000 15 MBI -Application /Processing Fee - Repairs Material 5,000 16 Merchants Bank Processing Fee 1,500 Repairs Contract 8,000 17 survey 30,000 Heating/Cooling Maintenance/Elevator 6,000 18 const ln ins 90,000 Decorating Supplies/Contract 4,000 19 const ln orig 95,000 Fire Inspections 7,500 20 const ln credit 523,310 Real Estate Taxes 45,000 21 taxes 5,000 Payroll Taxes 13,000 22 Construction Loan Admin./ monitoring Fee - Property Insurance 40,000 23 engineer 45,000 Fidelity Bond Insurance 600 24 2% Financing Fee 90,179 Health Insurance & Other Employee Benefits - 25 Market Study 6,000 Other-Supportitve Services 1,200 26 Tax Credit App. Fee 2,800 Reserve for Replacement 21,000 27 title/record 25,000 403,000 28 other atty 90,000 Per Unit with Reserves 4,798 29 furnish/equip 60,000 Per Unit without Reserve/Other 3,998 30 appraisal 12,000 31 MCC Processing Fee 5,000 SOURCES Term (years) Rate 32 environmental 35,000 MCC Loan Product 15 6.25% 4,508,943 33 LIHTC fees 112,889 NCHFA CDBG-DR 20 0.00% 2,500,000 34 Rent Up reseve 25,200 Local Gov Loan 2.00% 1,000,000 35 Initial Dep to Replacement Reserve 450 21,000 RD 515 Loan 0 - 36 Carryover Loan Fee 5,000 AHP Loan 0 - 37 developer fee 1,134,000 Workforce Housing 0 - 38 rentup res 25,200 Federal LIHTC Equity 0.87 8,189,283 39 operate res 355,094 Subordinated Loan - 40 Application & Permit Fees 3,000 Deferred Dev. Fee - 41 Building Permit 25,000 NCHFA Relief 0% 2,035,000 42 monit fee 127,680 Other Loan - 43 cost cert 10,750 18,233,226 44 Organizaitonal (Partnership) 1,000 45 DEVELOPMENT COST 17,508,226 Square Footage 88,944 90,480 46 less nonbasis items (1,015,542) with Comm. Bld 47 less fed fin/hptc USES 48 ELIGIBLE BASIS 16,492,684 Building Acq./ Land 725,000 49 applicable fraction 100.00% Land Improvements 2,449,000 50 TOTAL QUALIFIED BASIS 16,492,684 Construction 11,665,764 51 tax credit rate 9.00% Soft Cost 1,858,168 52 CREDITS ALLOCATED 1,484,342 Dev. Fee 1,134,000 53 CREDITS REQUESTED 941,391 Land Site Reserves 401,294 54 land cost 725,000 0 Other 55 TOTAL REPLACEMENT COST 18,233,226 TOTAL 18,233,226 7-20-22 with City funds and Relief funds-Wilmington-Merchants6.2 5 inhouse loan 84 units Family.xlsx EXHIBIT A: Development Budget with 20 year proforma Project Name: % of Amort Annual Source Amount Total Rate Term Period D.S MCC Loan Product 4,508,943 25% 6.25% 15 40 $307,188.65 NCHFA CDBG-DR 2,500,000 14% 0.00% 20 20 Local Government Loan 1,000,000 5% 2% 20 20 RD 515 Loan 0% AHP Loan 0% Subordinated Loan 0% 2% 30 30 Non-Amortizing Loan * 0% Non-Amortizing Loan * 0% Non-Amortizing Loan * 0% Tax Exempt Bond 0% Workforce Housing 0% State Tax Credit (Direct Refund) 0 Federal LIHTC Equity 8,189,283 45% Subordinated Loan 0% 2% 30 30 Deferred Developer Fee 0% NCHFA Relief 2,035,000 11% Other Loan 0% Total Sources 18,233,226 * Debt Service entered will carry to the Cash Flow page but can be edited on the Cash Flow page NOT RD ELIGIBLE Total Credits (from Credit Info Pag 9,413,910 Limited Partner Interest 99.99% Price on sale of Federal LIHTC Cre 0.87 Total Federal LIHTC Eqity 8,189,283 Federal LIHTC Equity Calculator Project Funding Sources Project Operations Number of Units Project Name Wilmington 84 Advertising 1,000 Office Salaries Office Supplies 4,000 Office or Model Apartment Rent Management Fee 46,500 Admin. Manager or Superintendent Salaries 35,000 Expenses Manager or Superintendent Rent Free Unit Legal Expenses (Project) 2,000 Auditing Expenses (Project) 9,000 Bookkeeping Fees/Accounting Services Telephone and Answering Service 6,000 Bad Debt Other Administrative Expense (specify)-Training, Travel 3,000 Total Administrative Expenses 106,500 Fuel/Oil/Coal Electricity (Light and Misc. Power) 22,000 Utilites Water 25,000 Expenses Gas Sewer 30,000 Total Utilities Expenses 77,000 Janitor and Cleaning Payroll 1,200 Janitor and Cleaning Supplies 1,000 Janitor and Cleaning Contract Exterminating Payroll/Contract 6,000 Exterminating Supplies Garbage and Trash Removal 10,000 Operating Security Payroll/ Contract and Grounds Payroll Maintenance Grounds Supplies 2,000 Expenses Grounds Contract 20,000 Repairs Payroll 28,000 Repairs Material 5,000 Repairs Contract 8,000 Elevator Maintenance/Contract Heating/Cooling Repairs and Maintenance 6,000 Swimmig Pool Mainteance/Contract Snow Removal Decorating Payroll/Contract 4,000 Decorating Supplies Other (specify) Miscellaneous Operating & Maintenance Expenses-Fire Insp. 7,500 Total Operating & Maintenance Expenses 98,700 Real Estate Taxes 45,000 Payroll Taxes (FICA) 13,000 Miscellaneous Taxes, License and Permits Taxes Property and Liability Insurance (Hazard) 40,000 and Fidelity Bond Insurance 600 Insurance Workmen's Compensation Health Insurance & Other Employee Benefits Other Insurance (Specify) Total Taxes and Insurance 98,600 Service Coordinator Supportive Service Supplies Service Tenant Assocation Funds Expenses Other Expenses (specify)Community Gatherings 1,200 Total Supportive Service Expenses 1,200 Reserves Replacement Reserve 21,000 Total Operating Expenses 403,000 Per Unit Cost of Operations 4,797.62 Per Unit Cost (less Reserves, RE Taxes, Supportive Services Expenses) 3,997.62 Gross Rental Income 802,380 Laundry and Vending 1,000 Rental and Other Income (specify)Tenant fees, Interest 10,088 Other Total Gross Rental & Other Income Potential at 100% Occupancy 813,468 Income 7% Vacancy Allowance (56,943) Net Rental and Other Income 756,525 Net Operating Income 353,525 income X 1.02 Other Income 11 per unit per month expenses X 1.03 reserves X 1.04 vacancy 0.07 home income 1.015 Average 0 TWENTY YEAR OPERATING PROFORMA YR1 YR2 YR3 YR4 YR5 YR6 YR7 YR8 REVENUES Gross Rental Income (esc. by 2%) 802,380 818,428 834,796 851,492 868,522 885,892 903,610 921,682 HOME RENTS (esc. By 1.5%) Vacancy Allowance (7% of GRI) 56,937 58,075 59,237 60,422 61,630 62,863 64,120 65,402 10.91 Other Income 11,000 11,220 11,444 11,673 11,907 12,145 12,388 12,636 Effective Gross Income 756,443 771,572 787,004 802,744 818,799 835,175 851,878 868,916 OPERATING EXPENSES (esc. by 4%) Advertising/Marketing 1,000 1,030 1,061 1,093 1,126 1,159 1,194 1,230 Management Fee 46,500 47,895 49,332 50,812 52,336 53,906 55,523 57,189 Legal/ Asst Mgmt Fee 2,000 2,060 2,122 2,185 2,251 2,319 2,388 2,460 Administrative 57,000 58,710 60,471 62,285 64,154 66,079 68,061 70,103 Utilities 77,000 79,310 81,689 84,140 86,664 89,264 91,942 94,700 Health Insurance & Other Employee Ben Fire Inspection 7,500 7,725 7,957 8,195 8,441 8,695 8,955 9,224 Trash Removal 10,000 10,300 10,609 10,927 11,255 11,593 11,941 12,299 Decorating/Repairs 8,200 8,446 8,699 8,960 9,229 9,506 9,791 10,085 Maintenance 53,000 54,590 56,228 57,915 59,652 61,442 63,285 65,183 Grounds 20,000 20,600 21,218 21,855 22,510 23,185 23,881 24,597 Taxes 45,000 46,350 47,741 49,173 50,648 52,167 53,732 55,344 Payroll Taxes 13,000 13,390 13,792 14,205 14,632 15,071 15,523 15,988 Insurance 40,600 41,818 43,073 44,365 45,696 47,067 48,479 49,933 Other 1,200 1,236 1,273 1,311 1,351 1,391 1,433 1,476 Total Operating Expenses 382,000 393,460 405,264 417,422 429,944 442,843 456,128 469,812 Per Unit 4,547.62 4,684.05 4,824.57 4,969.31 5,118.39 5,271.94 5,430.09 5,593.00 Per Unit minus Taxes and Other 3,997.62 4,117.55 4,241.07 4,368.31 4,499.36 4,634.34 4,773.37 4,916.57 403,000 NET OPERATING INCOME 374,443 378,112 381,740 385,322 388,854 392,332 395,750 399,104 Reserve Transfer (21,000) (21,840) (22,714) (23,622) (24,567) (25,550) (26,572) (27,635) Debt Service -1st Mortgage (307,189) (307,189) (307,189) (307,189) (307,189) (307,189) (307,189) (307,189) Debt Service - Guarantee Fee Debt Service - City Debt Service -Owner Loan Total Debt Service (307,189) (307,189) (307,189) (307,189) (307,189) (307,189) (307,189) (307,189) CASH FLOW AVAILABLE FOR DISTRIBUTION 46,255 49,084 51,838 54,511 57,099 59,594 61,990 64,281 Debt Coverage Ratio Bank Loan 1.15 1.16 1.17 1.18 1.19 1.19 1.20 1.21 All Loans 1.151 1.16 1.17 1.18 1.19 1.19 1.20 1.21 802,380 YR9 YR10 YR11 YR12 YR13 YR14 YR15 YR16 YR17 YR18 YR19 YR20 940,116 958,918 978,097 997,659 1,017,612 1,037,964 1,058,723 1,079,898 1,101,496 1,123,526 1,145,996 1,168,916 - 66,710 68,045 69,405 70,794 72,209 73,654 75,127 76,629 78,162 79,725 81,319 82,946 12,888 13,146 13,409 13,677 13,951 14,230 14,514 14,805 15,101 15,403 15,711 16,025 886,294 904,020 922,100 940,542 959,353 978,540 998,111 1,018,073 1,038,435 1,059,203 1,080,387 1,101,995 1,267 1,305 1,344 1,384 1,426 1,469 1,513 1,558 1,605 1,653 1,702 1,754 58,905 60,672 62,492 64,367 66,298 68,287 70,335 72,445 74,619 76,857 79,163 81,538 2,534 2,610 2,688 2,768 2,852 2,937 3,025 3,116 3,209 3,306 3,405 3,507 72,206 74,372 76,603 78,901 81,268 83,706 86,218 88,804 91,468 94,212 97,039 99,950 97,541 100,468 103,482 106,586 109,784 113,077 116,469 119,963 123,562 127,269 131,087 135,020 - 9,501 9,786 10,079 10,382 10,693 11,014 11,344 11,685 12,035 12,396 12,768 13,151 12,668 13,048 13,439 13,842 14,258 14,685 15,126 15,580 16,047 16,528 17,024 17,535 10,388 10,699 11,020 11,351 11,691 12,042 12,403 12,775 13,159 13,553 13,960 14,379 67,139 69,153 71,228 73,364 75,565 77,832 80,167 82,572 85,049 87,601 90,229 92,936 25,335 26,095 26,878 27,685 28,515 29,371 30,252 31,159 32,094 33,057 34,049 35,070 57,005 58,715 60,476 62,291 64,159 66,084 68,067 70,109 72,212 74,378 76,609 78,908 16,468 16,962 17,471 17,995 18,535 19,091 19,664 20,254 20,861 21,487 22,132 22,796 51,431 52,974 54,563 56,200 57,886 59,622 61,411 63,253 65,151 67,106 69,119 71,192 1,520 1,566 1,613 1,661 1,711 1,762 1,815 1,870 1,926 1,983 2,043 2,104 483,906 498,423 513,376 528,777 544,641 560,980 577,809 595,144 612,998 631,388 650,329 669,839 5,760.79 5,933.61 6,111.62 6,294.97 6,483.82 6,678.33 6,878.68 7,085.04 7,297.59 7,516.52 7,742.02 7,974.28 5,064.06 5,215.99 5,372.47 5,533.64 5,699.65 5,870.64 6,046.76 6,228.16 6,415.01 6,607.46 6,805.68 7,009.85 402,388 405,597 408,724 411,765 414,712 417,560 420,302 422,930 425,437 427,816 430,058 432,156 (28,740) (29,890) (31,085) (32,329) (33,622) (34,967) (36,365) (37,820) (39,333) (40,906) (42,542) (44,244) (307,189) (307,189) (307,189) (307,189) (307,189) (307,189) (307,189) (307,189) (307,189) (307,189) (307,189) (307,189) (307,189) (307,189) (307,189) (307,189) (307,189) (307,189) (307,189) (307,189) (307,189) (307,189) (307,189) (307,189) 66,459 68,518 70,450 72,248 73,902 75,405 76,748 77,921 78,916 79,721 80,327 80,723 511,109 948,381 1.22 1.22 1.23 1.24 1.24 1.25 1.25 1.25 1.26 1.26 1.26 1.2628 1.22 1.22 1.23 1.24 1.24 1.25 1.25 1.25 1.26 1.26 1.26 1.263 Exhibit A.1 - NCHFA - EL Tax Credit Allocation with Final App.pdf KM_C754e-20210930115813 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 1/46 Project Description Initial Project Details Project type Target population Tax-exempt bond volume Income Averaging Project Address Project name * Address City * Census tract Allocation Rental Tax Credit Application: APP21-0251 New Construction Family No Yes Estrella Landing Apartments 4615 Gordon Road Wilmington County New Hanover * Zip 28411 116.08 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 2/46 * Is project in a qualified census tract or difficult to develop area? Project Location Project Information * Proposed number of residential buildings * Will the project contain an elevator? * If yes, how many elevators? * Choose one of the following which applies to the project Jurisdiction No * Latitude 34.278517 * Longitude -77.864648 3 No None of the above 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/AP P21-0251/WithData 3/46 * Political jurisdiction * Address Site Description Acreage * Total site acreage * Total buildable acreage * If buildable acreage is less than total acreage, please explain Demolition * Is the demolition of any buildings required or planned? New Hanover County Please provide the name of the jurisdiction's mayor. If there is no mayor, provide the name of the County Commissioner Chairman. * Mayor's first name Julia * Mayor's last name Olson-Boseman 230 Government Center Drive - Suite 175 * City Wilmington * Zip code 28403 5.12 4.35 The northern portion of the property includes some wetland and 100 YR flood plain features. The residential buildings will be located in the upland area of the property well above the flood plain elevation. Impacts to wetlands will be limited to 0.5 AC. No 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/ Print/APP21-0251/WithData 4/46 * If yes, please describe Building Occupancy * Are existing buildings on the site currently occupied? If yes: * Briefly describe the situation * Will tenant displacement be temporary? * Will tenant displacement be permanent? Public Road Access * Is the site directly accessed by an existing, paved, publicly maintained road? * If no, see QAP section IV(A)(1)(iii) and please explain Historical and Environmental Significance * Are there any existing conditions of historical significance located on the project site that will require State Historic Preservation office review? * If yes, describe below No No The Property is connected to Gordon Road, NCDOT SR 2048, via a recorded 60' Access Easement (New Hanover County Registry DB 1215, PG 217 and Map Book 49, PG 214). These documents are included with the Purchase Agreement. No 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 5/46 * Are there any existing conditions of environmental significance located on the project site? * If yes, describe below Site Control and Zoning Fee ownership * Does the owner have fee simple ownership of the property (site/buildings)? * List Tax or Parcel ID for all tracts in the project Option/Contract Details * Does the owner/principal or ownership entity have valid option/contract to purchase the property? * Does an identity of interest (direct or indirect) exist between the owner/principal or ownership entity of the option/contract for purchase of the property and the seller of the property? * If yes, specify the relationship * Enter the expiration date of the option/contract to purchase Yes As addressed above, wetlands and 100 YR flood plain are present on the northern portion of the Property. The proposed development will be designed to minimize impacts to these features and locate the residential buildings well above the flood plain elevation. No * Purchase date * Purchase price Yes No 12/30/2021 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 6/46 * Enter purchase price List Tax or Parcel ID for all tracts in the project Zoning * Present zoning classification of the site * Is multifamily use permitted? * Are variances, special or conditional use permits or other discretionary land use approvals needed to develop this proposal (see requirement in QAP Section IV(A)(1)(a)(ii))? * If yes, specify permit or variance required and date obtained Applicant Information Applicant Info Indicate below an individual or a validly existing entity (a corporation, nonprofit, limited partnership or LLC) as the official Applicant. Under QAP Section III(C)(7) only this individual or entity will be able to make decisions with regard to this application. $725,000 R04300-001-007-000 Previous: R-15; Current: RMF-M (CZD) Yes Yes Although R-15 permits a multi-family use via a Special Use Permit, a Conditional Use Rezoning is required to achieve the density needed to develop the proposed 84 units. The application process for the Conditional Use Rezoning will begin the week of 1/25/2021 with a Pre-Application meeting with County Staff. The County Commissioners approved the rezoning request at their 4/5/2021 regular meeting. Applicant name Terroir Development, LLC * Address PO Box 15025 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 7/46 Contact Note: Email address above will be used for communication between NCHFA and Applicant. Tax Credit Info List one 9% tax credit project in North Carolina or six separate 9% projects totaling in excess of 200 units the above individual successfully developed, operated and maintained in compliance which was placed in service between January 1, 2015 and January 1, 2020. * Qualifying selection * City Wilmington * State North Carolina * Zip code 28408 * First name Stephanie * Last name Norris * Telephone (919) 669-1079 * Title Managing Member * Email address stephanie@norcomanagement.com * Nonprofit No One 9% tax credit project in North Carolina * Project name Lockwood Village Apartments * PIS date 6/30/2015 * Project name * PIS date * City * State * # units 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 8/46 IRS Form 8609 No.1 One Form 8609 is required for each of the six tax credit projects. No document uploaded * Project name * PIS date * City * State * # units IRS Form 8609 No.2 One Form 8609 is required for each of the six tax credit projects. No document uploaded * Project name * PIS date * City * State * # units IRS Form 8609 No.3 One Form 8609 is required for each of the six tax credit projects. No document uploaded 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 9/46 * Project name * PIS date * City * State * # units IRS Form 8609 No.4 One Form 8609 is required for each of the six tax credit projects. No document uploaded * Project name * PIS date * City * State * # units IRS Form 8609 No.5 One Form 8609 is required for each of the six tax credit projects. No document uploaded * Project name * PIS date * City * State * # units IRS Form 8609 No.6 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 10/46 * Total # units Ownership Entity Owner Information * Federal Tax ID number of Ownership Entity Note: Do not submit social security numbers for individuals. Primary Contact Information One Form 8609 is required for each of the six tax credit projects. No document uploaded * Name ESTRELLA LANDING APARTMENTS, LLC * Address PO Box 15025 * City Wilmington * State North Carolina * Zip code 28408 * Entity type Limited Liability Company * Entity status Already Formed 87-2554304 * First name Stephanie * Last name Norris 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/W ithData 11/46 Is the Applicant requesting the Agency treat the application: Members and Partners List all parties that will be part of the Ownership Entity. * Organization * Address * Organization * Address * as Nonprofit sponsored? No * as CHDO sponsored? Terroir Development, LLC * First name Stephanie * Last name Norris * Type Managing Member PO Box 15025 * City Wilmington * State North Carolina * Zip 28408 * Email stephanie@norcomanagement .com * Phone (919) 669-1079 * Nonprofit No Terroir Development, LLC * First name Joan * Last name Norris * Type Member PO Box 15025 * City Wilmington * State North Carolina * Zip 28408 * Email * Phone * Nonprofit 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 12/46 Unit Mix Project-Based Rental Assistance Will the project be receiving federal project-based rental assisance? * Federal project-based rental assistance * If yes, provide the subsidy source * Number of federal project-based rental assistance units? For underwriting purposes, the Agency will use Novogradac's Rent and Income Limit Calculator to determine rent limits. Low Income Units * Type * # BRs * # Baths * Heated Sq. Ft. * Total # Units # Units * HOME Units? * Monthly Rent * Utility Allowance Mandatory Serv. Fees **Total Housing Exp * Targeted Income * Occupancy Standard Gdn Apt 1 1 Bath 715 3 1 No 335 62 0 397 30% Affordable to and Occupied by Gdn Apt 1 1 Bath 715 8 1 No 745 62 0 807 60% Affordable to and Occupied by Gdn Apt 1 1 Bath 715 1 No 855 62 0 917 80% Affordable to and Occupied by Gdn Apt 1 2 Baths 980 1 No 855 62 0 917 80% Affordable to and Occupied by Gdn Apt 2 2 Baths 980 9 2 No 410 77 0 487 30% Affordable to and Occupied by Gdn Apt 2 2 Baths 980 22 2 No 900 77 0 977 60% Affordable to and Occupied by Gdn Apt 2 2 Baths 980 4 No 950 77 0 1,027 80% Affordable to and Occupied by Gdn Apt 3 2 Baths 1,152 9 2 No 480 93 0 573 30% Affordable to and Occupied by Gdn Apt 3 2 Baths 1,152 23 2 No 1,000 93 0 1,093 60% Affordable to and Occupied by Gdn Apt 3 2 Baths 1,152 4 0 No 1,100 93 0 1,193 80% Affordable to and Occupied by Electric Included Gas Included Water/Sewer Included Other Included * Other Comment joan@norcomanagement.com (910) 791-3354 No No 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 13/46 Average Targeted Income Bedroom Type Targeted Income SRO NA EFF NA One Bedroom 56.15% Two Bedroom 54.57% Three Bedroom 54.72% Four Bedroom NA Five Bedroom NA Project 54.88% Employee Units No units defined. Market Rate Units No units defined. Totals All Units Mobility Impaired Units Gross Yearly Rental Income Low Income 84 10 812,220 Market Rate 0 0 0 Totals 84 10 812,220 Additional Targeting Indicate below any additional targeting for special populations proposed for this project. Mobility impaired: 5% of units comply with QAP Section IV(F)(4) (in addition to the units required by other federal and state codes.) Solid Waste Collection and Recycling 10 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 14/46 Minimum Number of Mobility Units Required: 10 * Persons with disabilities or homeless populations Minimum Number of Units Required: 9 Market Study Info * Please provide a detailed description of the proposed project * Construction Check all that apply, at least 1 must be checked * Description of other 9 Estrella Landing is located in a high-growth area on the northern side of New Hanover County, where new residential communities have been recently completed and others are under construction. The site is near the I-40/Gordon Road interchange, which offers great access to all parts of the Cape Fear Region and beyond. The development will consist of 84-units within three (3), 3-Story buildings: 13 - 1 Bedroom Units, 35 - 2 Bedroom Units and 36 - 3 Bedroom Units. The Clubhouse will include the Site Manager's Office and Resident Community Space. Interior features of each apartment will include: Energy Star appliances, Washer/Dryer hookups, Ceiling Fans in the living and bedrooms, Exterior Storage Areas, among other features. We intend to use a wood plank Luxury Vinyl Tile (LVT), where economically feasible, to enhance and update the interiors of the apartments. Site amenities, interior to the Community Space and exterior Common Areas, will meet the requirements of the QAP. Brick Vinyl Wood HardiPlank Balconies/Patios Sunrooms Front porches Front gables or dormers Wide banding or vertical/horizontal siding Other The architectural style of Estrella Landing will be identical to our Bennett Village property located on the southern end of the County. The modern craftsman design of the buildings is inviting and similar to the Family properties we have developed in recent years. Our product and building aesthetic rivals any high-end, market rate apartment community, like the Hawthorne at Smith Creek development adjacent to the Estrella 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 15/46 * Unit Amenities Check all that apply, at least 1 must be checked * Description of other Security Check all that apply * Description of other Landing site. The proposed materials are intended to achieve long-term use and durability with relatively low-maintenance. The roof lines will be broken and building footprints will have varying lines to produce a building with excellent curb appeal. Ceiling Fan Coat Closet Dishwasher Emergency Pull Chain Frost Free Refrigerator Garbage Disposal Internet Connection (not phone line) Exterior Storage Microwave Miniblinds Patio / Balcony Self-Clean Oven Walk-in Closet Washer / Dryer Hookups Other All residential units will include: Covered Entry Areas and Exterior Storage within protected Breezeways, 2nd Full Bath for 2 & 3 Bedroom Units, Walk-in-Closets in the Master Bedroom of all unit types, among other features. The ADA units will also include self-cleaning ovens, in addition to other features that meet UFAS requirements. Emergency Pull-Chains are designated for accessible units only. Intercom Call Station at Entry Keypad Entry System Lighting Other Emergency Pull-Chains to activate lights and audible alarms will be installed in accessible units. 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 16/46 * Project Amenities Check all that apply, at least 1 must be checked * Description of other * Have you built other tax credit developments that use the same building design as this project? Beauty / Barber Shop Bus Shelter Community Room Computer Center Covered Drive-Thru or Drop-Off at Entry Covered Picnic Area Elevator Exercise Room Game / Craft / TV rooms Garage / Carport (Attached or Detached) Gazebo Indoor or Outdoor Seating Areas Laundry Room Library Outdoor Sitting Areas with Benches Playground / Tot Lot Raised Bed Garden Plots Screened Porch Sunroom with Chairs Swimming Pool (bond deals only) Tenant Storage Areas Transportation Services Walking Trails Other In addition to the Project Amenities chosen from the list above, the Covered Mailbox Kiosk will be located at the Clubhouse. The Multi-Purpose/Community Room in the Clubhouse will be available for resident socials or private parties. Amenities Proposed: Interior to Clubhouse - Multi-Purpose/Community Room with living (sofa and chairs) and dining room furniture and TV; Resident Computer Center (2 computers) Exterior in Common Areas - Covered Picnic with tables and grills; Playground; Outdoor Seating with benches (3 locations); Covered Patio with rocking chairs (Rear Clubhouse Porch) Yes 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 17/46 Neighborhood Characteristics (maximum 10 points) 10 * If yes, please provide name and address * Onsite activities * Landscaping plans * Do you plan to submit additional market data (market study, etc.) that you want considered? Site Scoring Self Evaluation Sections of this page are abbreviated. See QAP Section IV(A)(1) for a full description. Bennett Village Apartments - Wilmington (72 Units) Artesa Village Apartments - Sunset Beach (72 Units) The Community Building and Common Areas will be well-appointed for neighborhood socials and private events. Our management team works closely with our residents to coordinate events, such as informational meetings with City/County Police and Emergency personnel to emphasize public and fire safety within our community. The central area of the subject site is mostly an open field with pockets mixed, mature hardwood and pine trees. The northern portion of the site is heavily wooded and will stay that way for the most part. Where possible, and specifically at property perimeters, existing vegetation will be preserved to provide a substantial, natural buffer between adjacent properties, especially adjacent to the single-family residences to the south. Where land disturbance is necessary, new landscaping will be installed around building foundations, landscape islands within parking areas and throughout the common area. The plantings will be native to the area to keep water usage to a minimum. Sod will be used around the building perimeters to quickly achieve stability throughout the site. A landscape plan will be developed during the plan review stage and will be included in the construction drawings for the site. No * Is this project located in a Small Town? No * Does this project qualify as a Redevelopment Project as described in QAP Section II(B)(2)(b)? No * Choose one of the following which describes the condition of structures within a half mile of the site. 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 18/46 Amenities (maximum 38 points) 38 * Describe the condition of structures within a half mile of the site which should be indicative of why the site rates Good, Fair or Poor. * Galaxy Food Center Name Good The Estrella Landing site is bordered on the North by new luxury apartment community, Hawthorne at Smith Creek, which features a resort style pool and all of that comes with it. On the East side of the site, is the long, winding and well-manicured entrance to Hawthorne at Smith Creek (Rosebay Terrace) that connects the community to Gordon Road. To the West is a fenced and gated storage and stormwater management facility for the Buy Quick (Shell Gas Station & C-Store) that fronts Gordon Road. The existing paved driveway that serves the Buy Quick is located within a shared Access Easement (recorded) that also serves the Estrella Landing site. Immediately to the South of the site are two existing single-family residences. With the significant financial investment in the new residential development to the North (Hawthorne at Smith Creek) and the large subdivision (The Landing at Lewis Creek) across Gordon Road, this area of the County is clearly experiencing a renewed growth. 26Primary (maximum 26 points) * Grocery Lowes Foods * Distance (in miles) 1.1 Grocery Score 12 * Shopping Family Dollar * Distance (in miles) 1.2 Shopping Score 7 * Pharmacy Walgreens * Distance (in miles) 1.2 Pharmacy Score 7 12Secondary (maximum 12 points) Grocery, Shopping or Pharmacy Pharmacy Distance (in miles) 2.5 Score 3 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 19/46 Site Suitability (maximum 12 points) 12 * Pharmacy (or Galaxy Food Center) Name Walgreens (6861 Market Street) Service Buy Quick (Shell Gas & CStore) Distance (in miles) 0.1 Service Score 3 Healthcare Medac Urgent Care Distance (in miles) 1.7 Healthcare Score 2 Public Facility Parkwood Park Distance (in miles) 1.1 Public Facility Score 3 Public School Trask Middle & Laney High Schools Distance (in miles) 2.0 Public School Score 2 Retail Dollar General Distance (in miles) 1.4 Retail Score 3 These items are applied to the Amenities score but the total cannot exceed 38 points. * Does this project have a commitment of $250,000 in qualifying tribal funds? Score No 0 * Does this project contain a qualifying bus/transit stop? No Score 0 * Is there an incompatible use near the site? Incompatible Use Score No 3 * Are there negative features, design challenges, physical barriers, etc.? Negative Features Score No 3 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 20/46 Minimum Set-Asides Minimum Set-Asides * Would the project be visible to potential tenants using normal travel patterns? Yes * Is the site within 500 feet of a building that is currently in use for residential, commercial, educational or governmental purposes? Close Buildings Score Yes 3 * Are there traffic controls to allow safe and convenient access to the site? Traffic Controls Score Yes 3 * Describe why your project does or does not qualify for Site Suitability points. The area surrounding the subject site is clearly evolving and transitioning. Residential development is happening at a record pace throughout New Hanover County, as more people are relocating to a coastal community. The Estrella Landing site is well positioned to be apart of the growth in this area of the County. The connection to Gordon Road and ultimately I-40, College Road and Market Street in the immediate vicinity will give residents easy access to employment, retail and service hubs. For these reasons, we believe this site is an outstanding affordable housing location for working families and seniors living on fixed incomes. 60T otal Score: Twenty percent (20%) of the units are rent restricted and occupied by households with incomes at or below fifty percent (50%) of area median income (Note: No Tax Credit eligible unit in the project can exceed fifty percent (50%) of area median income) Forty percent (40%) of the units are rent restricted and occupied by households with incomes at or below sixty percent (60%) of area median income (Note: No Tax Credit eligible unit in the project can exceed sixty percent (60%) of area median income) 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 21/46 If requesting RPP funds: * Period of Affordability (in Years) Select one of the following if requesting points: High Income County: Funding Sources Source Amount Non-Amortizing Rate (%) Term (Yrs) Amort. Period (Yrs) Annual Debt Service Bank Loan 4,265,720 5.75% 35 35 283,329 RPP Loan RPP-DR Loan 2,500,000 0% 20 20 0 Local Gov. Loan (specify) RD 515 Loan RD 538 Loan (specify) AHP Loan CDBG-DR Other Loan 2 (specify) Other Loan 3 (specify) RD 515 Assumed Tax Exempt Bonds Workforce Housing Loan Program 0% 30 30 0 Equity: Federal LIHTC 8,189,283 $0.870Estimated pricing on sale of tax credits Total Sources 14,955,003 One hundred percent (100%) of the units are rent restricted and occupied by households with incomes at or below one or more of the following designations: 20%, 30%, 40%, 50%, 60%, 70%, and/or 80% of area median income. Such designations cannot exceed an average of sixty percent (60%) of area median income. Forty percent (40%) of the qualified low-income units will be affordable to and occupied by households with incomes at or below fifty percent (50%) of area median income. Applicant agrees that if this project receives funding from the National Housing Trust Fund (NHTF), NHTF-assisted housing units will comply with all NHTF requirements. At least twenty-five percent (25%) of qualified low-income units will be affordable to and occupied by households with incomes at or below thirty percent (30%) of area median income. At least fifteen percent (15%) of qualified low-income units will be affordable to and occupied by households with incomes at or below thirty percent (30%) of area median income. 1 3 2 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 22/46 Source Amount Non-Amortizing Rate (%) Term (Yrs) Amort. Period (Yrs) Annual Debt Service Non-Repayable Grant Equity: Historic Tax Credits Deferred Developer Fees Owner Investment Other (specify) Total Sources 14,955,003 Non-amortizing indicates that the loan does not have a fixed annual debt service. For these items, you must fill in 35 -year debt service below. Total Sources must equal total replacement cost in Project Development Cost (PDC) section. All fields for the Workforce Housing Loan Program are locked except for Amount. Remarks concerning project funding sources (Please be sure to include the name of the funding source(s)) Development Costs Item Cost Element TOTAL COST Eligible Basis 30% PV 70% PV 1 Purchase of Building(s) (Rehab / Adaptive Reuse only) 2 Demolition (Rehab / Adaptive Reuse only) 3 On-site Improvements 2,184,000 2,184,000 4 Rehabilitation 5 Construction of New Building(s) 6,520,068 6,520,068 6 Accessory Building(s) 192,000 192,000 7 General Requirements (max 6% lines 2-6) 533,764 533,764 8 Contractor Overhead (max 2% lines 2-7) 188,597 188,597 9 Contractor Profit (max 8% lines 2-7; 6% if Identity of Interest) 754,387 754,387 10 Construction Contingency (5% lines 2-9, Rehab/Adaptive Reuse 10%) 518,641 518,641 11 Architect's Fee - Design (11 + 12 = max 3% lines 2-10) 314,744 314,744 12 Architect's Fee - Inspection 12,000 12,000 13 Engineering Costs 45,000 45,000 SUBTOTAL (lines 1 through 13) 11,263,201 14 Construction Insurance (prorate) 45,000 45,000 15 Construction Loan Orig. Fee (prorate) 90,000 90,000 16 Construction Loan Interest (prorate) 426,727 251,728 1 2 1 2 3 Equity Investor: Merchants Capital Investments LLC Permanent Lender: Merchants Capital – HUD 223 (f) 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 23/46 17 Construction Loan Credit Enhancement (prorate) 18 Construction Period Taxes (prorate) 5,000 5,000 19 Building Permit Fee 25,000 25,000 20 Water, Sewer and Impact Fees 99,750 99,750 21 Survey 30,000 30,000 22 Property Appraisal 12,000 12,000 23 Environmental Report 12,000 12,000 24 Market Study 4,400 4,400 25 Bond Costs 26 Bond Issuance Costs 27 Placement Fee 28 Permanent Loan Origination Fee 93,863 29 Permanent Loan Credit Enhancement 30 Title and Recording 20,000 SUBTOTAL (lines 14 through 30) 863,740 31 Real Estate Attorney 35,000 35,000 32 Other Attorney's Fees 100,000 50,000 33 Tax Credit Application Fees (Preliminary and Full) 2,800 34 Tax Credit Allocation Fee 112,889 35 WHLP Closing Fee ($1,500 if requesting funds) 36 RPP Closing Fee ($2,000 if requesting funds) 37 Cost Certification / Accounting Fees 17,500 9,500 38 Tax Opinion 5,000 39 Organizational (Partnership) 40 Tax Credit Monitoring Fee ($1,520 per unit) 127,680 SUBTOTAL (lines 31 through 40) 400,869 41 Furnishings and Equipment 60,000 60,000 42 Relocation Expense 43 Developer's Fee 1,134,000 1,134,000 44 HUD Exam Fee- .30 of loan amount 14,080 45 Carryover Loan Fee 5,000 46 Rent-up Expense 25,200 47 Third Party Reports 23,500/ HUD Inspection Fee 1,500 25,000 48 UPFRONT Initial IMP 11,733 SUBTOTAL (lines 41 through 48) 1,275,013 49 Rent up Reserve 25,200 50 Operating Reserve 343,180 51 Initial Deposit to Replacement Reserves 58,800 52 Other Reserve (specify) 53 DEVELOPMENT COST (lines 1 through 52) 14,230,003 13,126,579 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 24/46 54 Less Federally Funded Grant 55 Less Disproportionate Standard 56 Less Nonqualified Nonrecourse Financing 57 Less Historic Tax Credit 58 TOTAL ELIGIBLE BASIS 13,126,579 13,126,579 59 Applicable Fraction (percentage of LI Units) 100% 100% 100% 60 Basis Before Boost 13,126,579 13,126,579 61 Basis Boost of up to 110% 100% 100% 62 TOTAL QUALIFIED BASIS 13,126,579 13,126,579 63 Tax Credit Rate 4% 9% 64 Federal Tax Credits (maximum $1,200,000) 1,181,392 1,181,392 65 Federal Tax Credits Requested (if less than line 64) 941,391 941,391 66 Land Cost 725,000 67 TOTAL REPLACEMENT COST 14,955,003 FEDERAL TAX CREDITS IF AWARDED 941,391 Comments On-site Improvements This is a detailed breakdown of the On-Site Improvements cost element summarized in the Development Costs table. The total should match that value. Item Total Clearing/Grading/Final Grading/Excess and Borrow 645,154 Demolition Earthwork/Excavation/Aerating Soil Treatment 5,022 Pile Foundations Caissons Retaining Wall(s) Site Drainage 325,416 Total 2,184,000 Project Development Cost per unit 79,906 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 25/46 Site Utilities/Site Lighting 373,246 Paving and Surfacing/Curb and Gutter 412,339 Walkways 99,372 Site Signage 6,989 Parking Lot Painting 7,426 Dumpster Pads/Fencing 55,910 Fencing/Gates 10,265 Landscaping/Topsoil 172,536 Irrigation Systems Rock and Hardpan Excavation Site Supervision Personnel Site Amenities(Playground, Tot Lot, Gazebo, Garden Plot, etc.) Underground Storm Water Retention Outdoor Maintenance Building Other (specify in Remarks) 70,325 Total 2,184,000 Remarks Operating Expenses Administrative Expenses Advertising 1,000 Office Salaries Office Supplies 4,000 Office or Model Apartment Rent Management Fee 46,500 Manager or Superintendent Salaries 35,000 Manager or Superintendent Rent Free Unit Legal Expenses (Project) 2,000 Auditing Expenses (Project) 9,000 Bookkeeping Fees/Accounting Services Telephone and Answering Service 6,000 Bad Debts Training and Travel 3,000 SUBTOTAL 106,500 Utilities Expense Fuel Oil Electricity (Light and Misc. Power) 22,000 Other: Playground and outdoor furnishings 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 26/46 Water 25,000 Gas Sewer 30,000 SUBTOTAL 77,000 Operating and Maintenance Expenses Janitor and Cleaning Payroll 1,200 Janitor and Cleaning Supplies 1,000 Janitor and Cleaning Contract Exterminating Payroll/Contract 6,000 Exterminating Supplies Garbage and Trash Removal 10,000 Security Payroll/Contract Grounds Payroll Grounds Supplies 2,000 Grounds Contract 20,000 Repairs Payroll 28,000 Repairs Material 5,000 Repairs Contract 8,000 Elevator Maintenance/Contract Heating/Cooling Repairs and Maintenance 6,000 Swimming Pool Maintenance/Contract Snow Removal Decorating Payroll/Contract 4,000 Decorating Supplies Other Operating and Maintenance Expense(specify): Fire Inspections & Monitoring 7,500 SUBTOTAL 98,700 Taxes and Insurance Real Estate Taxes 45,000 Payroll Taxes (FICA) 13,000 Miscellaneous Taxes, Licenses and Permits Property and Liability Insurance (Hazard) 40,000 Fidelity Bond Insurance 600 Workmen's Compensation Health Insurance and Other Employee Benefits Other Insurance (specify): SUBTOTAL 98,600 Supportive Service Expenses Service Coordinator Service Supplies 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Applicat ion/Print/APP21-0251/WithData 27/46 Tenant Association Funds Community Gatherings 1,200 SUBTOTAL 1,200 Reserves Replacement Reserves 21,000 SUBTOTAL 21,000 TOTAL OPERATING EXPENSES 403,000 ADJUSTED TOTAL OPERATING EXPENSES (Does not include taxes, reserves and resident support services) * 335,800 TOTAL UNITS (from total units in the Unit Mix section) 84 PER UNIT PER YEAR 3,998 Cash Flow Year One OPERATING INCOME Gross Rental Income (from Unit Mix - Total Monthly Rent) 812,220 HOME Rental Income (trends at 1.50%) 0 Stores and Commercial Laundry and Vending 1,000 Interest, Late Fees, Damages 10,000 Total Gross Income Potential at 100% Occupancy 823,220 Vacancy Rate 7% Vacancy Allowance 57,625 NET RENTAL/OTHER INCOME 765,595 TOTAL OPERATING EXPENSES (from Operating Expenses) 403,000 NET OPERATING INCOME 362,595 DEBT SERVICE (from Funding Sources Loans) 283,329 NET CASH FLOW 79,266 DEBT COVERAGE RATIO (Must not be less than 1.15) 1.280 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 28/46 35 Years Cash Flow Year 1 2 3 4 5 6 7 8 9 10 Net Rental/Other Income 765,595 780,906 796,524 812,455 828,703 845,277 862,183 879,427 897,016 914,955 Total Operating Expenses 403,000 415,300 427,978 441,045 454,513 468,394 482,701 497,448 512,647 528,314 Debt Service 283,329 283,329 283,329 283,329 283,329 283,329 283,329 283,329 283,329 283,329 Net Cash Flow 79,266 82,277 85,217 88,081 90,861 93,554 96,153 98,650 101,040 103,312 Debt Coverage Ratio 1.280 1.290 1.301 1.311 1.321 1.330 1.339 1.348 1.357 1.365 Year 11 12 13 14 15 16 17 18 19 20 Net Rental/Other Income 933,255 951,920 970,959 990,378 1,010,186 1,030,390 1,050,998 1,072,018 1,093,458 1,115,328 Total Operating Expenses 544,463 561,107 578,263 595,947 614,175 632,964 652,331 672,294 692,872 714,084 Debt Service 283,329 283,329 283,329 283,329 283,329 283,329 283,329 283,329 283,329 283,329 Net Cash Flow 105,463 107,484 109,367 111,102 112,682 114,097 115,338 116,395 117,257 117,915 Debt Coverage Ratio 1.372 1.379 1.386 1.392 1.398 1.403 1.407 1.411 1.414 1.416 Year 21 22 23 24 25 26 27 28 29 30 Net Rental/Other Income 1,137,634 1,160,386 1,183,593 1,207,266 1,231,411 1,256,039 1,281,161 1,306,784 1,332,919 1,359,577 Total Operating Expenses 735,949 758,488 781,721 805,670 830,357 855,806 882,040 909,083 936,961 965,700 Debt Service 283,329 283,329 283,329 283,329 283,329 283,329 283,329 283,329 283,329 283,329 Net Cash Flow 118,356 118,569 118,543 118,267 117,725 116,904 115,792 114,372 112,629 110,548 Debt Coverage Ratio 1.418 1.418 1.418 1.417 1.416 1.413 1.409 1.404 1.398 1.390 Year 31 32 33 34 35 36 37 38 39 40 Net Rental/Other Income 1,386,769 1,414,505 1,442,795 1,471,652 1,501,084 Total Operating Expenses 995,326 1,025,867 1,057,352 1,089,809 1,123,270 Debt Service 283,329 283,329 283,329 283,329 283,329 Net Cash Flow 108,114 105,309 102,114 98,514 94,485 Debt Coverage Ratio 1.382 1.372 1.360 1.348 1.333 * Net Rental Income escalated at annual rate of 2% and expenses escalated at a rate of 3% after the first year. Calculations 1. "Net Rental/Other Income" comes from 1st-year cash flow, then it is escalated by 2% per year. 2. "Total Operating Expenses" comes from 1st-year cash flow, then it is escalated by 3% per year (Replacement Reserves escalate at 4%). 3. "Debt Service" is the sum of "regular/amortized loan debt service + non-amortizing annual debt service" as entered by user from Funding Sources section. 4. "Net Cash Flow" is "Net Rental/Other Income" minus "Total Operating Expenses" minus "Debt Service". 5. "Debt Coverage Ratio" is ("Net Rental/Other Income" minus "Total Operating Expenses") divided by "Debt Service". 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 1 2 3 4 5 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa. org/RTCApp/Application/Print/APP21-0251/WithData 29/46 Development Team Default Project Contact * Default Project Contact Applicant Bonus Point Do you want the Applicant Bonus Point as described in QAP Section IV(F)(3) applied to this project? * Applicant Bonus Point * Number of Points Provide contact information for the development team members below. Architect * Company * Address Applicant Yes 2 Martin Riley Associates 215 Church Street - Suite 200 * City Decatur * State Georgia * Zip 30030 * Phone (404) 373-2800 * Email jmartin@martinriley.com 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 30/46 Attorney * Company * Address Consultant/Application Preparer (if different from Applicant) Company Address * Architect first name Jackie * Architect last name Martin Blanco Tackabery Law 110 South Stratford Road * City Winston-Salem * State North Carolina * Zip 27104 * Phone (336) 293-9045 * Email jfg@blancolaw.com * Attorney first name James * Attorney last name Goodwin City State Zip Phone Email Preparer first name Preparer last name 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 31/46 General Contractor * Company * Address Management Agent Select a management agent, below, or choose 'Other' and complete the following fields. * Management Agent * Company * Address Identity of interest Wynnefield Construction, LLC PO Box 395 * City Jamestown * State North Carolina * Zip 27282 * Phone (336) 454-6134 * Email craig.stone@wynnefieldproperties.com * Contact first name Craig * Contact last name Stone Norco Management Holding, Inc. * City * State * Zip * Phone * Email 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 32/46 * Describe the Agent's past experience operating tax credit properties * List all states in which the Agent has managed tax credit properties and provide a contact name and number for each state agency * Describe any common interest or ownership between the property owner and the Agent * Is the Agent licensed by the North Carolina Real Estate Commission to conduct the business of property management in North Carolina? Disclose the license number and the entity name of record * Describe the lines of authority, responsibility, and accountability (internal controls) within the Agent entity * Describe the oversight that will be provided by the Agent to ensure compliance with Section 42 as it relates to eligibility and record keeping * Identify the staff position that will be responsible for the preparation and submission of tax credit reports required by the Agency * List the position(s) that will be responsible for carrying out the functions of eligibility determination, tenant selection, unit assignment, certification, and recertification * Describe the type and frequency of tax credit training that will be provided to on-site and Agent’s staff * Describe the key eligibility criteria that will be addressed on the rental application and which household members that it will relate to (household composition, income, assets, student status, etc.) * Agent first name * Agent last name 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 33/46 * Describe the screening tools that will be utilized to ensure deserving applicants are selected. Indicate whether credit reports, criminal history reports, and verifications of previous rental history will be included * If applicants are subject to meeting a minimum income, please identify the minimum(s), explain the method used to arrive at it, and how it will be applied to certificate and voucher holders * Describe the Agent’s experience with affirmative marketing practices * Describe the Agent’s policy for accepting Section 8 certificates and vouchers Prior experiences Please list ALL current and past development experiences for this management company. Experience 1 * Any outstanding uncorrected noncompliance? (8823) * Property type * Apartment name * City * State * Zip * # units * Financing type * Tax credits * Date started * Currently participating? Date ended 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 34/46 Developer Experience Summary All member/partners must be listed on the Ownership Entity page. A summary must be completed for each entity listed on the Ownership Entity page. Terroir Development, LLC / Stephanie Norris * Principal Office Address Principal Name Terroir Development, LLC First Name Stephanie Last Name Norris * Is this the Principal to be considered under QAP Section IV(D)(1) (must have been the Applicant in the preliminary application)? Yes PO Box 15025 * Principal Office City Wilmington * Principal Office State North Carolina * Name of North Carolina low-income housing tax credit project(s) this Principal has developed, operated and maintained in compliance between January 1, 2015 and January 1, 2020? Lockwood Village Apartments * Have you been involved in any project awarded 9% tax credits in 2020 for which the equity investment has not closed as of the full application deadline? Yes * Please explain The equity for Highlands Village Apartments (APP20-0160) has not closed as of the date of the 2021 Full Application submittal for the reasons noted below. A Letter of Intent has been executed with Merchants Capital that targets the equity closing by 10/1/2021. * COVID-19 and the Presidential Election delayed equity markets in 2020 * Boston Capital, our equity syndicator for most recent LIHTC deals, was purchased by Boston Financial in Dec 2020, which delayed their release of LOI's 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 35/46 For the following questions, answer for all projects even if not LIHTC or in North Carolina. * Sharp increases construction material prices, specifically for lumber, are creating significant gaps in the funding and creating underwriting delays. * Are you involved in any North Carolina project awarded tax credits after 2000 where there has been a change in general partners or managing members during the last 5 years that the Agency did not approve in writing beforehand? No * Please explain * Would you be removed from the ownership of a project that is the subject of an application under the rehabilitation set-aside in the current cycle? No * Please explain * Total number of 8823’s filed on your tax credit projects that remain uncorrected? 0 * Please list project(s) with uncorrected 8823s * Have you been found to be directly or indirectly responsible for any other project within the past five years in which there is or was uncorrected noncompliance more than three months from the date of notification by the Agency or any other state allocating agency? No * Please explain * Have you or a project for which you are a Principal been involved within the past ten (10) years in a bankruptcy, adverse fair housing settlement, adverse civil rights settlement, or adverse federal or state government proceeding and settlement? No * Please explain 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21 -0251/WithData 36/46 Terroir Development, LLC / Joan Norris * Have you or a publicly subsidized project for which you are a Principal been in a mortgage default or arrearage of three months or more within the last five years? No * Please explain * Have you been involved within the past ten years in a project which received an allocation of tax credits but failed to meet standards or requirements of the tax credit allocation or failed to fulfill one of the representations contained in an application for tax credits? No * Please explain * Have you been debarred or received a limited denial of participation in the past 10 years by any federal or state agency from participating in any development program? No * Please explain * Do you have any outstanding flags in HUD’s national 2530 Previous Participation system? No * Please explain Principal Name Terroir Development, LLC First Name Joan Last Name Norris * Is this the Principal to be considered under QAP Section IV(D)(1) (must have been the Applicant in the preliminary application)? 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 37/46 * Principal Office Address No PO Box 15025 * Principal Office City Wilmington * Principal Office State North Carolina * Name of North Carolina low-income housing tax credit project(s) this Principal has developed, operated and maintained in compliance between January 1, 2015 and January 1, 2020? Lockwood Village Apartments * Have you been involved in any project awarded 9% tax credits in 2020 for which the equity investment has not closed as of the full application deadline? Yes * Please explain The equity for Highlands Village Apartments (APP20-0160) has not closed as of the date of the 2021 Full Application submittal for the reasons noted below. A Letter of Intent has been executed with Merchants Capital that targets the equity closing by 10/1/2021. * COVID-19 and the Presidential Election delayed equity markets in 2020 * Boston Capital, our equity syndicator for most recent LIHTC deals, was purchased by Boston Financial in Dec 2020, which delayed their release of LOI's * Sharp increases construction material prices, specifically for lumber, are creating significant gaps in the funding and creating underwriting delays. * Are you involved in any North Carolina project awarded tax credits after 2000 where there has been a change in general partners or managing members during the last 5 years that the Agency did not approve in writing beforehand? No * Please explain * Would you be removed from the ownership of a project that is the subject of an application under the rehabilitation set-aside in the current cycle? No * Please explain 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 38/46 For the following questions, answer for all projects even if not LIHTC or in North Carolina. * Total number of 8823’s filed on your tax credit projects that remain uncorrected? 0 * Please list project(s) with uncorrected 8823s * Have you been found to be directly or indirectly responsible for any other project within the past five years in which there is or was uncorrected noncompliance more than three months from the date of notification by the Agency or any other state allocating agency? No * Please explain * Have you or a project for which you are a Principal been involved within the past ten (10) years in a bankruptcy, adverse fair housing settlement, adverse civil rights settlement, or adverse federal or state government proceeding and settlement? No * Please explain * Have you or a publicly subsidized project for which you are a Principal been in a mortgage default or arrearage of three months or more within the last five years? No * Please explain * Have you been involved within the past ten years in a project which received an allocation of tax credits but failed to meet standards or requirements of the tax credit allocation or failed to fulfill one of the representations contained in an application for tax credits? No * Please explain 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 39/46 Buildings Buildings BIN Number * Address Unit Summary for This Building * Have you been debarred or received a limited denial of participation in the past 10 years by any federal or state agency from participating in any development program? No * Please explain * Do you have any outstanding flags in HUD’s national 2530 Previous Participation system? No * Please explain NC-21-16501 4615 Gordon Road - Building 100 Placed in Service Date * SRO 0 * Low Income 24 * Efficiency 0 * Market Rate 0 * One Bedroom 6 * Employee 0 * Two Bedroom 12 * Total 24 * Three Bedroom 6 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 40/46 BIN Number * Address Unit Summary for This Building BIN Number * Address * Four Bedroom 0 * Five Bedroom 0 * Total 24 NC-21-16502 4615 Gordon Road - Building 200 Placed in Service Date * SRO 0 * Low Income 36 * Efficiency 0 * Market Rate 0 * One Bedroom 1 * Employee 0 * Two Bedroom 11 * Total 36 * Three Bedroom 24 * Four Bedroom 0 * Five Bedroom 0 * Total 36 NC-21-16503 4615 Gordon Road - Building 300 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 41/46 Unit Summary for This Building Carryover Information The following items must be collected in order to generate your Carryover Allocation Agreement Carryover Agreement Info * Total Reasonably Expected Basis in the Project * Actual Basis as of the date of this Agreement Percentage of Actual Basis to Expected Basis * Expected Placed in Service Date Placed in Service Date * SRO 0 * Low Income 24 * Efficiency 0 * Market Rate 0 * One Bedroom 6 * Employee 0 * Two Bedroom 12 * Total 24 * Three Bedroom 6 * Four Bedroom 0 * Five Bedroom 0 * Total 24 $13,126,579 $49,040 0.4 12/31/2023 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 42/46 Carryover Signature Info * Partner Entity signing document on behalf of the Ownership Entity Additional Partner Entity (if needed for signature block) * Additional Partner type * Name of person signing document * Title of person signing document Allocation Document Uploads Document Upload Overview Generate Carryover Document Once the Buildings Section and Carryover Information Sections have been saved and validated, generate your Carryover Agreement by clicking the button below. * Carryover Agreement Signed Carryover Agreement NCHFA - Estrella Landing Carryover Alloc_TERROIR.pdf Carryover Agreement Terroir Development, LLC Stephanie L. Norris Managing Member 11/18/21, 8:39 AM RTC App Allocation Rental Tax Credit Application: APP21-0251 https://www.nchfa.org/RTCApp/Application/Print/APP21-0251/WithData 43/46 Executed Carryover Agreement Executed Carryover Agreement Estrella Landing executed carryover.pdf Carryover Agreement * IRS EIN Letter IRS letter giving the Federal taxpayer identification number for the Ownership Entity. ESTRELLA LANDING - IRS EIN 2021-09-09.pdf Employer Identification Number Letter * Certificate of Limited Partnership or Articles of Incorporation Ownership Entity documentation filed with the North Carolina Secretary of State’s Office. ESTRELLA LANDING - ARTICLES OF ORG 2021-09-09.pdf Articles of Incorporation * Legal Description of Property A current, valid narrative legal description of each parcel of land if a valid postal service address does not exist for each building. DOCS-#840024-v1Legal_Description_for_Carryover_(Estrella_Landi ng).pdf Property Legal Description Exhibit A.1.1 - NCHFA - 2021 Credit Exchange Letter 2022-05-16.pdf Microsoft Word - QAP return credit ltr May 16, 2022 To Whom it May Concern: Since 2014, the North Carolina QAP has included a provision to allow for the return of credits to provide owners the opportunity to return an allocation of credits in exchange for the same amount from the next year’s credit allocation to avoid the loss of credits if the project is not able to meet the placed-in-service deadline. In the 2022 QAP, we revised this provision due to COVID related delays and cost increases, and we allowed both 2019 and 2020 awards the opportunity to return tax credits for an equal amount of 2022 tax credits with a 2024 placed in service deadline. It is our intent to include a similar provision in the 2023 QAP to allow the 2021 awards to receive 2023 tax credits with a 2025 placed in service deadline. If you have any additional questions, please feel free to contact me directly at (919) 877-5641 or sfarmer@nchfa.com. Sincerely, Scott Farmer Executive Director A self-supporting public agency Scott Farmer Executive Director PO Box 28066 Raleigh, NC 27611-8066 3508 Bush Street Raleigh, NC 27609-7509 TEL. 919-877-5700 FAX 919-877-5701 www.nchfa.com Exhibit A.1.2 - NCHFA - EL Project Update 2022-05-26.pdf WHLP-CV REQUEST WRITE UP Estrella Landing Apartments, LLC would like to request WHLP-CV funds in the amount of 3,020,000 to help address the funding shortfall caused by COVID 19-related issues. The resulting global pandemic has created historic job-related cost increases in every major construction category. There are no material changes proposed for this site from the application to this request as it relates to the overall unit count, unit sizes and mix, project and unit amenities, landscaping, parking, and items of this nature. The relevant job characteristics: outside of cost, remain consistent to the project as proposed at the time of the tax credit award. We have included letters from the proposed project lenders with updated deal terms as applicable. The current proposed deferred fee 0.00 matches the proposed amount at the time of the tax credit award. Most of the specific construction cost increases, in this update, are due to increases in construction cost throughout the job. Those costs increases include items like materials, increases in pricing for the commodities used in the production of equipment used throughout the job, lumber material of all types, wood assembly materials including trusses and makeup, all categories of PM&E items, exterior materials like cementitious board and brick, supply chain and logistics cost, labor and finding labor, and time constraints which have added cost. We have also included for your review a summary breakdown that compares our application proposed pricing along with our updated pricing for this request as a side-by-side comparison. Estrella Cost Comparison at Approved Application to Current Item Original Revised Construction No. Description of Work Approved Application Contract Difference 1 Purchase of Buildings (rehab) 2 Demolition (Rehab/Adaptive Reuse only) 3 On Site Improvements Clearing/Final Grading/Excess and Borrow 645,154.00 563,270.00 81,884.00 Soil Treatment 5,022.00 7,347.00 (2,325.00) Site Drainage 325,416.00 293,880.00 31,536.00 Site Utilites/Site Lighting 373,246.00 587,760.00 (214,514.00) Pavingand Surfacing/Curb and Gutter 412,339.00 489,800.00 (77,461.00) Walkways 99,372.00 73,470.00 25,902.00 Site Signate 6,989.00 48,980.00 (41,991.00) Parking Lot Painting 7,426.00 24,490.00 (17,064.00) Dumpsite Pads/Fencing 55,910.00 73,470.00 (17,560.00) Fencing/Gates 10,265.00 24,490.00 (14,225.00) Landscaping/Topsoil 172,536.00 262,043.00 (89,507.00) Other Playground and Outdoor Furnishings 70,325.00 4 Rehabilitation 5 Construction of New Builidng(s) Termite Treatment 4,062.86 5,528.15 (1,465.29) Concrete 260,799.32 354,858.66 (94,059.34) Masonry 177,680.66 241,761.86 (64,081.20) Metals 213,458.09 290,442.55 (76,984.46) Carpentry& Millwork 1,703,094.56 2,317,321.97 (614,227.41) Thermal & Moisture Protection 941,428.85 1,280,958.67 (339,529.82) Doors & Windows 322,669.63 439,041.64 (116,372.01) Finishes 674,048.60 917,146.74 (243,098.14) Specialities 391,868.97 676,875.05 (285,006.08) Equipment 117,432.27 159,784.66 (42,352.39) Mechanical 1,068,994.05 1,454,530.75 (385,536.70) Electrical 644,530.14 701,593.30 (57,063.16) 6 Accessory Building(s) Termite Treatment 487.13 608.91 (121.78) Concrete 20,872.30 26,090.38 (5,218.08) Masonry 11,794.66 14,801.32 (3,006.66) Metals 2,415.03 3,018.79 (603.76) Carpentry& Millwork 33,670.03 42,087.54 (8,417.51) Thermal & Moisture Protection 42,022.25 52,527.82 (10,505.57) Doors & Windows 10,883.22 13,604.02 (2,720.80) Finishes 16,350.02 20,379.16 (4,029.14) Specialities 21,356.64 26,696.18 (5,339.54) Equipment 1,290.88 1,613.60 (322.72) Mechanical 22,423.43 28,029.29 (5,605.86) Electrical 8,434.41 10,542.99 (2,108.58) 7 General Requirements (max 6% lines 2-6) 533,764.00 691,730.64 (157,966.64) 8 Constractor Overhead (max 2% lines 2-7) 188,597.00 244,411.49 (55,814.49) 9 Contractor Profit (max 8% lines 2-7 6% if identity of interest) 754,387.00 977,645.97 (223,258.97) 10 Construction Contingency 518,641.00 672,131.61 (153,490.61) 11 Architect's Fee-Design (11+12 = max 3% lines 2-10) 314,744.00 277,140.00 37,604.00 12 Architect's Fee- Inspection 12,000.00 12,000.00 13 Engineering Costs 45,000.00 45,000.00 SUBTOTAL (lines 1 through 13) 11,263,201.00 14,448,903.71 (3,185,702.71) 14 Construction Insurance 45,000.00 90,000.00 (45,000) 15 Construction Loan Orig. Fee 90,000.00 95,000.00 (5,000) 16 Construction Loan Interest 426,727.00 508,478.73 (81,752) 17 Construction Loan Credit Enhancement 18 Construction Period Taxes 5,000.00 5,000.00 19 Building Permit Fees 25,000.00 25,000.00 20 Water, Sewer and Impact Fees 99,750.00 107,720.00 (7,970) 21 Survey 30,000.00 30,000.00 22 Property Appraisal 12,000.00 12,000.00 23 Environmental Report 12,000.00 35,000.00 (23,000) 24 Market Study 4,400.00 6,000.00 (1,600) 25 Bond Costs 26 Bond Issurance Costs Estrella Development Cost 27 Placement Fee 28 Permanent Loan Origination Fee 93,863.00 90,174.21 3,689 29 Permanent Loan Credit Enhancement 30 Title and Recording 20,000.00 25,000.00 (5,000) SUBTOTAL (lines 14 through 30) 863,740.00 1,029,372.94 (165,633) 31 Real Estate Attorney 35,000.00 35,000.00 32 Other Attorney's Fees 100,000.00 90,000.00 10,000 33 Tax credit Applciation Fee 2,800.00 2,800.00 34 Tax Credit Allocation Fee 112,889.00 112,889.00 35 WHLP Closing Fee 36 RPP Closing Fee 37 Cost Certification/ Accounting Fees 17,500.00 10,750.00 6,750 38 Tax Opinion 5,000.00 5,000 39 Organizational 1,000.00 (1,000) 40 Tax Credit Monitoring Fees 127,680.00 127,680.00 SUBTOTAL (lines 31 through 40) 400,869.00 380,119.00 20,750 41 Furnishings and Equipment 60,000.00 60,000.00 42 Relocation Expense 43 Developers Fees 1,134,000.00 1,134,000.00 44 Merchants Bank Processing Fee 14,080.00 1,500.00 12,580 45 MCC Processing Fee 5,000.00 5,000.00 46 Rent Up Expenses 25,200.00 25,200.00 47 Application & Permit Fees 3,000.00 (3,000) 47 Third Parpty Repots 23,500/Hud Inspection fee 1,500 25,000.00 48 UPFRONT Initial IMP 11,733.00 11,733 SUBTOTAL (lines 41 through 48) 1,275,013.00 1,228,700.00 46,313 49 Rent Up Reserve 25,200.00 25,200.00 50 Operating Reserve 343,180.00 355,086.40 (11,906) 51 Initial Dep to Replacement Reserves 58,800.00 21,000.00 37,800 52 Carryover Loan Fee 5,000.00 (5,000) 53 DEVELOPMENT COST (lines 1 through 52) 14,230,003.00 17,493,382.04 (3,263,379) 66 Land Cost 725,000.00 725,000.00 67 Total Replacement Cost 14,955,003.00 18,218,382.04 (3,263,379) 7/21/22, 4:13 PM RTC App - Funding Sources https://www.nchfa.org/RTCApp/App/APP21-0251/FundingSources 1/1 Terms of Service© 2022 - NCHFA Project: Estrella Landing Apartments Underwriter: Tara Hall Status: 2021 - Project Update Submitted Funding Sources Source Amount Non-Amortizing Rate (%) Term (Yrs) Amort. Period (Yrs) Annual Debt Service Bank Loan 4,508,710 6.25% 15 40 307,173 RPP Loan RPP-DR Loan 2,500,000 0% 20 20 0 Local Gov. Loan (specify) RD 515 Loan RD 538 Loan (specify) AHP Loan CDBG-DR Other Loan 2 (specify) Other Loan 3 (specify) RD 515 Assumed Tax Exempt Bonds Workforce Housing Loan Program 0% 30 30 0 WHLP-CV 3,020,000 0% 30 30 0 Equity: Federal LIHTC 8,189,283 $0.870Estimated pricing on sale of tax credits Non-Repayable Grant Equity: Historic Tax Credits Deferred Developer Fees Owner Investment 388 Other (specify) Total Sources 18,218,381 Non-amortizing indicates that the loan does not have a fixed annual debt service. For these items, you must fill in 30 -year debt service below. Total Sources must equal total replacement cost in Project Development Cost (PDC) section. All fields for the Workforce Housing Loan Program are locked except for Amount. Remarks concerning project funding sources (Please be sure to include the name of the funding source(s)) 1 3 2 1 2 3 Equity Investor: TBD (still negotiating) Permanent Lender: Merchants Capital – MBI 9% Forward Permanent Loan Product 7/21/22, 4:14 PM RTC App - Development Costs https://www.nchfa.org/RTCApp/App/APP21-0251/DevCosts 1/2 Project: Estrella Landing Apartments Underwriter: Tara Hall Status: 2021 - Project Update Submitted Development Costs Item Cost Element TOTAL COST Eligible Basis 30% PV 70% PV 1 Purchase of Building(s) (Rehab / Adaptive Reuse only) 2 Demolition (Rehab / Adaptive Reuse only) 3 On-site Improvements 2,449,000 2,449,000 4 Rehabilitation 5 Construction of New Building(s) 8,839,844 8,839,844 6 Accessory Building(s) 240,000 240,000 7 General Requirements (max 6% lines 2-6) 691,731 691,731 8 Contractor Overhead (max 2% lines 2-7) 244,411 244,411 9 Contractor Profit (max 8% lines 2-7; 6% if Identity of Interest) 977,646 977,646 10 Construction Contingency (5% lines 2-9, Rehab/Adaptive Reuse 10%) 672,132 672,132 11 Architect's Fee - Design (11 + 12 = max 3% lines 2-10) 277,140 277,140 12 Architect's Fee - Inspection 12,000 12,000 13 Engineering Costs 45,000 45,000 SUBTOTAL (lines 1 through 13) 14,448,904 14 Construction Insurance (prorate) 90,000 90,000 15 Construction Loan Orig. Fee (prorate) 95,000 95,000 16 Construction Loan Interest (prorate) 508,478 508,478 17 Construction Loan Credit Enhancement (prorate) 18 Construction Period Taxes (prorate) 5,000 5,000 19 Building Permit Fee 25,000 25,000 20 Water, Sewer and Impact Fees 107,720 107,720 21 Survey 30,000 30,000 22 Property Appraisal 12,000 12,000 23 Environmental Report 35,000 35,000 24 Market Study 6,000 6,000 25 Bond Costs 26 Bond Issuance Costs 27 Placement Fee 28 Permanent Loan Origination Fee 90,174 29 Permanent Loan Credit Enhancement 30 Title and Recording 25,000 SUBTOTAL (lines 14 through 30) 1,029,372 31 Real Estate Attorney 35,000 35,000 32 Other Attorney's Fees 90,000 50,000 33 Tax Credit Application Fees (Preliminary and Full) 2,800 34 Tax Credit Allocation Fee 112,889 35 WHLP Closing Fee ($1,500 if requesting funds) 36 RPP Closing Fee ($2,000 if requesting funds) 37 Cost Certification / Accounting Fees 10,750 9,500 38 Tax Opinion 39 Organizational (Partnership) 1,000 40 Tax Credit Monitoring Fee ($1,520 per unit) 127,680 SUBTOTAL (lines 31 through 40) 380,119 41 Furnishings and Equipment 60,000 60,000 42 Relocation Expense 7/21/22, 4:14 PM RTC App - Development Costs https://www.nchfa.org/RTCApp/App/APP21 -0251/DevCosts 2/2 Terms of Service© 2022 - NCHF A 43 Developer's Fee 1,134,000 1,134,000 44 MBI/MCC Processing Fee 6,500 45 Carryover Loan Fee 5,000 46 Rent-up Expense 25,200 47 Const Dwg Application & Permit Fees 3,000 48 Other Non-basis Expense (specify) SUBTOTAL (lines 41 through 48) 1,233,700 49 Rent up Reserve 25,200 50 Operating Reserve 355,086 51 Initial Deposit to Replacement Reserves 21,000 52 Other Reserve (specify) 53 DEVELOPMENT COST (lines 1 through 52) 17,493,381 16,651,602 54 Less Federally Funded Grant 55 Less Disproportionate Standard 56 Less Nonqualified Nonrecourse Financing 57 Less Historic Tax Credit 58 TOTAL ELIGIBLE BASIS 16,651,602 16,651,602 59 Applicable Fraction (percentage of LI Units) 100% 100.000000% 100% 60 Basis Before Boost 16,651,602 16,651,602 61 Basis Boost of up to 110% 100% 100% 62 TOTAL QUALIFIED BASIS 16,651,602 16,651,602 63 Tax Credit Rate 4.000000% 9% 64 Federal Tax Credits (maximum $1,200,000) 1,498,644 1,498,644 65 Federal Tax Credits Requested (if less than line 64) 941,391 941,391 66 Land Cost 725,000 67 TOTAL REPLACEMENT COST 18,218,381 FEDERAL TAX CREDITS IF AWARDED 941,391 Comments Project Development Cost per unit 108,093 7/21/22, 4:14 PM RTC App - On-Site Improvements https://www.nchfa.org/RTCApp/App/APP21-0251/OnSiteImprovements 1/1 Terms of Service© 2022 - NCHF A Project: Estrella Landing Apartments Underwriter: Tara Hall Status: 2021 - Project Update Submitted On-site Improvements This is a detailed breakdown of the On-Site Improvements cost element summarized in the Development Costs table. The total should match that value. Item Total Clearing/Grading/Final Grading/Excess and Borrow 563,270 Demolition Earthwork/Excavation/Aerating Soil Treatment 7,347 Pile Foundations Caissons Retaining Wall(s) Site Drainage 293,880 Site Utilities/Site Lighting 587,760 Paving and Surfacing/Curb and Gutter 489,800 Walkways 73,470 Site Signage 48,980 Parking Lot Painting 24,490 Dumpster Pads/Fencing 73,470 Fencing/Gates 24,490 Landscaping/Topsoil 262,043 Irrigation Systems Rock and Hardpan Excavation Site Supervision Personnel Site Amenities(Playground, Tot Lot, Gazebo, Garden Plot, etc.) Underground Storm Water Retention Outdoor Maintenance Building Other (specify in Remarks) Total 2,449,000 Remarks 7/21/22, 4:16 PM RTC App - Project Update Doc Uploads https://www.nchfa.org/RTCApp/App/APP21-0251/ProjectUpdateDocUploads 1/2 Terms of Service© 2022 - NCHF A Project Update Doc Uploads Document Upload Overview Investor Letter of Intent Investor Letter of Intent No document uploaded Commitment Letter(s) Commitment letter(s) for all permanent loan sources. Merchants - MBI Forward Perm Loan Letter_Estrella Landing 2022-05-26.pdf Commitment Letter Utility Allowance Documentation Documentation to support estimated utility costs. No document uploaded Site Plan Site plan, floor plans and elevations. Full size plans (24 x 36 inches) must also be delivered to the Agency in hard copy format. No document uploaded Developer Correspondence Any additional supporting documentation for the Project Update NCHFA WHLP-CV - Project Summary_Estrella Landing.pdf Developer Correspondence Project: Estrella Landing Apartments Underwriter: Tara Hall Status: 2021 - Project Update Submitted 7/21/22, 4:17 PM RTC App - My Documents https://www.nchfa.org/RTCApp/App/APP21-0251/MyDocuments 1/2 Project: Estrella Landing Apartments Underwriter: Tara Hall Status: 2021 - Project Update Submitted My Documents Preliminary Submission - 1/22/2021 Preliminary - Evidence of Site Control: Purchase Agreement - 4615 Gordon Road_FULLY EXECUTED.pdf - 1/21/2021 Preliminary - Evidence of Site Control: Terroir - Estrella Landing_Access.pdf - 1/21/2021 Preliminary - Notice of Real Property Acquisition: NRPA - 4615 Gordon Road_FULLY EXECUTED.pdf - 1/21/2021 Preliminary - Site Map: Google Maps - Driving Instructions.pdf - 1/22/2021 Preliminary - Site Map: County - 4615 Gordon Rd_GIS Vicinity Map.pdf - 1/22/2021 Preliminary - Site Amenities: Google Maps - Driving Instructions.pdf - 1/22/2021 Preliminary - Site Amenities: County - 4615 Gordon Rd_GIS Vicinity Map.pdf - 1/22/2021 Preliminary - Site Amenities: County - 4615 Gordon Rd_GIS Tax Parcel Map.pdf - 1/22/2021 Preliminary - Site Amenities: Google Maps - Primary Grocery.pdf - 1/22/2021 Preliminary - Site Amenities: Google Maps - Primary Pharmacy.pdf - 1/22/2021 Preliminary - Site Amenities: Google Maps - Primary Shopping.pdf - 1/22/2021 Preliminary - Site Amenities: Google Maps - Second Pharmacy.pdf - 1/22/2021 Preliminary - Site Amenities: Google Maps - Second Retail.pdf - 1/22/2021 Preliminary - Site Amenities: Google Maps - Second Service.pdf - 1/22/2021 Preliminary - Site Amenities: Google Maps - Second Medical.pdf - 1/22/2021 Preliminary - Site Amenities: Google Maps - Second Public Park.pdf - 1/22/2021 Preliminary - Site Amenities: Google Maps - Second Public School.pdf - 1/22/2021 Preliminary - Site Amenities: Photo - Primary Grocery_Lowes Foods.pdf - 1/22/2021 Preliminary - Site Amenities: Photo - Primary Pharmacy_Walgreens.pdf - 1/22/2021 Preliminary - Site Amenities: Photo - Primary Shopping_Family Dollar.pdf - 1/22/2021 Preliminary - Site Amenities: Photo - Second Medical_Medac Urgent.pdf - 1/22/2021 Preliminary - Site Amenities: Photo - Second Retail_Dollar General.pdf - 1/22/2021 Preliminary - Site Amenities: Photo - Second Service_Shell Gas & C-Store.pdf - 1/22/2021 Preliminary - Site Amenities: Photo - Second Public Park_Parkwood.pdf - 1/22/2021 Preliminary - Site Amenities: Photo - Second Public School_Trask MS.pdf - 1/22/2021 Preliminary - Site Amenities: Photo - Second Pharmacy_Walgreens (Market St).pdf - 1/22/2021 Preliminary - Site Amenities: Google Maps - Second Public School_Laney HS.pdf - 1/22/2021 Preliminary - Site Amenities: Photo - Second Public School_Laney HS.pdf - 1/22/2021 Preliminary - Site and Floor Plans: MRA -Estrella Landing Prelim Plans 2021-01-22.pdf - 1/22/2021 Preliminary - Market Study: Estrella Landing Apts. (WILMINGTON, NC - 17374) MS.pdf - 3/15/2021 Preliminary - Rental Tax Credit Application: APP21-0251 - Preliminary.pdf - 1/22/2021 Full Submission - 5/14/2021 Full - Flood Zone Designation: BWA - Estrella Landing Flood Cert 2021-04-19.pdf - 5/10/2021 Full - Zoning Confirmation Letter: County - Estrella Landing Rezoning Approval 4.5.2021.pdf - 5/10/2021 Full - Water-Sewer Impact Fees: CFPUA - Estrella Landing W&S Availability Letter 2021-04-26.pdf - 5/10/2021 Full - Utility Letters: CFPUA - Estrella Landing W&S Availability Letter 2021-04-26.pdf - 5/10/2021 Full - Utility Allowance Documentation: UApro - Estrella Landing Utility Allowances_April 2021.pdf - 5/10/2021 Full - Uniform Residential Appraisal Report: Tallent - Estrella Landing Land Appraisal 05-11-2021.pdf - 5/12/2021 Full - Financial Statements: Personal Financial Statement_JON 2020-12-31.pdf Full - Financial Statements: Personal Financial Statement_SLN 2021-03-31.pdf Full - Site Plans: MRA - Estrella Landing Prelim Plans 2021-05-04.pdf - 5/13/2021 Full - Commitment Letter: Merchants - Estrella Landing HUD 223F Commitment 2021-05-14.pdf - 5/14/2021 Full - Utility Allowance Documentation: UApro - Estrella Landing Utility Allowances_April 2021.pdf - 7/19/2021 Full - Rental Tax Credit Application: APP21-0251 - Full.pdf - 5/14/2021 Final Applicant Acceptance - 7/28/2021 Final - Rental Tax Credit Application: APP21-0251 - Final.pdf - 7/28/2021 7/21/22, 4:17 PM RTC App - My Documents https://www.nchfa.org/RTCApp/App/APP21-0251/MyDocuments 2/2 Terms of Service© 2022 - NCHF A Allocation Application Returned - 9/24/2021 Allocation - Employer Identification Number Letter: ESTRELLA LANDING - IRS EIN 2021-09-09.pdf - 9/24/2021 Allocation - Articles of Incorporation: ESTRELLA LANDING - ARTICLES OF ORG 2021-09-09.pdf - 9/24/2021 Allocation - Property Legal Description: DOCS-#840024-v1-Legal_Description_for_Carryover_(Estrella_Landing).pdf - 9/24/2021 Allocation - Signed Carryover Agreement: NCHFA - Estrella Landing Carryover Alloc_TERROIR.pdf - 9/24/2021 Allocation - Rental Tax Credit Application: APP21-0251 - Allocation - Awarded.pdf - 9/24/2021 Allocation Application Acceptance - 10/1/2021 Allocation - Employer Identification Number Letter: ESTRELLA LANDING - IRS EIN 2021-09-09.pdf - 10/1/2021 Allocation - Articles of Incorporation: ESTRELLA LANDING - ARTICLES OF ORG 2021-09-09.pdf - 10/1/2021 Allocation - Property Legal Description: DOCS-#840024-v1-Legal_Description_for_Carryover_(Estrella_Landing).pdf - 10/1/2021 Allocation - Signed Carryover Agreement: NCHFA - Estrella Landing Carryover Alloc_TERROIR.pdf - 10/1/2021 Allocation - Executed Carryover Agreement: Estrella Landing executed carryover.pdf - 10/1/2021 Allocation - Rental Tax Credit Application: APP21-0251 - Allocation - Awarded.pdf - 10/1/2021 Working Documents Allocation - Employer Identification Number Letter: ESTRELLA LANDING - IRS EIN 2021-09-09.pdf - 9/20/2021 Allocation - Articles of Incorporation: ESTRELLA LANDING - ARTICLES OF ORG 2021-09-09.pdf - 9/20/2021 Allocation - Property Legal Description: DOCS-#840024-v1-Legal_Description_for_Carry over_(Estrella_Landing).pdf - 9/23/2021 Allocation - Signed Carryover Agreement: NCHFA - Estrella Landing Carryover Alloc_TERROIR.pdf - 9/24/2021 Allocation - Executed Carryover Agreement: Estrella Landing executed carryover.pdf - 9/30/2021 Project Update - Other Commitment Letter: Merchants - MBI Forward Perm Loan Letter_Estrella Landing 2022-05-26.pdf - 5/26/2022 Project Update - Developer Correspondence: NCHFA WHLP-CV - Project Summary_Estrella Landing.pdf - 5/26/2022 Exhibit A.3 - NCHFA - EL CDBG Cond Commitment 2021-12-21.pdf Exhibit A.4 - Merchants - EL Perm Loan Commitment 2022-05-26.pdf 410 Monon Blvd, 5th Floor | Carmel, IN 46032 PHONE 317-569-7420 WEB merchantscapital.com May 26, 2022 Ms. Stephanie Norris Terroir Development, LLC PO Box 15025 Wilmington, NC 28408 Re: Estrella Landing Apartments Financing Proposal Dear Ms. Norris: Merchants Capital recognizes that Terroir Development, LLC is acting as sponsor of a Low-Income Housing Tax Credit development to be known as Estrella Landing Apartments, located at 4615 Gordon Road, Wilmington, North Carolina 28411. The formal name of the owning entity is Estrella Landing Apartments, LLC. We have reviewed the application to be submitted to NCHFA for Estrella Landing Apartments. We expressly acknowledge that the development will be subject to specific income limits and the 40-80 set aside. It is our understanding that Estrella Landing Apartments will consist of eighty-four (84) rental units, providing affordable rental housing. There are two (2) income/rent set aside within the development, as follows: • Twenty-One (21) units will be set aside with rents targeted at or below thirty (30%) of the New Hanover County area median income; • Sixty-three (63) units will be set aside with rents targeted at or below sixty (60%) of the New Hanover County area median income; Merchants Capital will provide permanent financing for Estrella Landing Apartments under the following terms and conditions via a Merchants Bank of Indiana 9% Forward Commitment Permanent Program: BORROWER: Estrella Landing Apartments, LLC LOAN AMOUNT: $4,508,710.00 INTEREST RATE: Underwritten at 6.25% fixed. The interest rate shall be a fixed rate based on the 10-year SOFR swap rate plus the Investor spread plus the servicing spread. The current rate is estimated at 6.15%. TERM: 15 years AMORTIZATION: 40 years FINANCING FEE: 2.0% 410 Monon Blvd, 5th Floor | Carmel, IN 46032 PHONE 317-569-7420 WEB merchantscapital.com MERCHANTS CAPITAL APPLICATION FEE: $21,500 (Includes 3rd Party reports, Merchants non-refundable processing fee and legal retainer) LENDER LEGAL FEES: $25,000 (Estimated) PRE-PAYMENT PENALTY: Yield Maintenance COLLATERAL: First mortgage on the subject parcel(s) and all improvements including eighty-four (84) rental units known as Estrella Landing Apartments. At this time preliminary credit approval has been obtained. This proposal however is subject to the borrower’s ability to deliver IRS Section 42 Low Income Housing Tax Credits for the development, in an amount and under terms satisfactory to Merchants Capital and the following conditions: 1. Final review and approval of plans and specifications; 2. Completion of construction; 3. Final review and approval of the financial forecasts; 4. Review and approval of appraisal, project capital needs, and environmental reports; 5. Project must attain three consecutive months property operations based on permanent loan underwriting a 1.15x DSCR prior to closing; 6. Verification of funding of equity and any other required funding sources; 7. Full due diligence and approval by Merchants Capital and Merchants Bank of Indiana; Thank you for this opportunity to participate in this development. Sincerely, ______________________________ Jeffrey T. Spahn, Senior Vice President Exhibit B - Terroir - Mission Statement & Member Experience.pdf TERROIR DEVELOPMENT, LLC P.O. BOX 15025 ♦ WILMINGTON, NORTH CAROLINA 28408 ♦ OFFICE 910.791.3354 Mission Statement We continue to build upon the 40+ year experience of our Members, exclusively in the area of developing affordable, safe and attractive housing for our Community’s most vulnerable Residents. We collaborate with development partners, lenders, vendors and allies with the expertise and passion for the same goal and vision. We persistently work to improve living conditions for members of our Community with limited means and help them find a place to call home. TERROIR DEVELOPMENT, LLC P.O. BOX 15025 ♦ WILMINGTON, NORTH CAROLINA 28408 ♦ OFFICE 910.791.3354 STEPHANIE L. NORRIS AFFORDABLE HOUSING EXPERIENCE TERROIR DEVELOPMENT, LLC YEAR # OF % OF LIHTC SENIOR COMPLEX LOCATION BUILT UNITS AFFORDABLE UNITS PROPERTY (55+) TOTAL DEVELOPMENT COST Highlands Village New Bern, NC 2022 60 100% YES NO $11,325,089 Bennett Village Wilmington, NC 2020 72 100% YES NO $11,698,442 Artesa Village Sunset Beach, NC 2020 72 100% YES NO $11,138,055 OTTER CREEK PARTNERS, LLC & SNW, LLP YEAR # OF % OF LIHTC SENIOR COMPLEX LOCATION BUILT UNITS AFFORDABLE UNITS PROPERTY (55+) TOTAL DEVELOPMENT COST Ravenswood Reserve Wilson, NC 2018 60 100% YES YES $6,994,649 Ravenswood Wilson, NC 2015 72 100% YES NO $8,466,477 Lockwood Village Wilmington, NC 2015 60 100% YES NO $8,151,351 Covey Reserve Whiteville, NC 2013 44 100% YES YES $5,347,465 Covey Run Ph 2 Whiteville, NC 2011 48 100% YES NO $5,567,265 Maple Ridge Ph 3 Fayetteville, NC 2010 80 100% YES NO $8,587,394 Covey Run Whiteville, NC 2009 48 100% YES NO $5,277,468 Maple Ridge Fayetteville, NC 2008 48 100% YES NO $4,936,153 Waterbrook Raleigh, NC 2007 64 100% YES YES $6,805,311