HOUSING DEVELOPMENT FUND COMES TO AID OF NEW HAVEN DEVELOPER WITH FULL SERVICE PACKAGE TO PUT 12 CONDOMINIUMS BACK ON TRACK

New Haven Construction’s Santa Fe Commons -- Three-bedroom, 2.5-bath Townhouses -- Will Include Four Affordable Housing Units

STAMFORD, Conn., April 10, 2008- Alberto Alvarez was almost all set to build the largest development in his ten-year career as owner of New Haven Construction. He had acquired a site in the northeast section of New Haven, in a residential neighborhood well located near shopping and highways. He had received zoning approval to build Santa Fe Commons -- 12 three-bedroom, one full and two half-bath townhouse condominiums with two-car garages. The Maryland-based bank he had applied to for financing through a local mortgage broker had received an appraisal of the project that they felt was too low and declined his request. Fortunately, the mortgage broker was also familiar with Housing Development Fund (HDF). She suggested that Alvarez contact the unique nonprofit bank based in Stamford, whose special multi-family financing program is designed to help small developers like Alvarez create more units of affordable, as well as market rate housing. In addition, with its homebuyer and technical assistance programs, HDF was able to put together a soup-to-nuts process to assure the success of the project – from construction financing to finding and assisting the buyers.

Recently, HDF and New Haven Construction closed on a financing package of $2.1 million. In the interim, Alvarez had used his own funds to clear the site, draft condo documents and pour footings for the first of four phases at Santa Fe Commons. But, in spite of a strong commitment to the project, Alvarez was highly leveraged with dwindling funds and could not have moved beyond these preliminary steps without the infusion of funding from HDF.

Today there are 12 units and four will be sold as affordable housing. The Housing Development Fund has partnered with Neighborhood Housing Services of New Haven (NHS) to identify and counsel first time homebuyers for the affordable units, while HDF will put together downpayment and closing cost assistance for the buyers.

“This loan represents HDF’s first in New Haven – and we expect many more to follow,” said Kevin Porter, who oversees HDF’s lending programs. “Having an excellent local partner like NHS has given us an excellent introduction to the area where we expect to become more active. There is most definitely a need for a program like ours as there is very little, if any, traditional financing available for small developers with projects of this size.”

For its multi-family program, HDF put together a consortium of 16 Connecticut banks that have contributed to a pool of funds totaling $30 million. Because risk is spread among the banks, HDF can offer more favorable first mortgage terms to qualified developers than individual commercial lenders can, including smaller down payments and lower interest rates.

In this case, the fact that the banks in the consortium are local and understand the New Haven market was instrumental in substantiating the over-all value of the development. Also, in addition to hard construction costs, HDF included soft costs like architecture and engineering, appraisals and building permits in total project value.

“As a developer and renovator of two-to-four unit properties I had only worked with mortgage brokers,” said Alberto Alvarez. “HDF took a chance on me when conventional lenders wouldn’t. Having them as a resource will make all the difference in the success of Santa Fe Commons and the growth of my business.”

The Housing Development Fund was founded in 1989. It has expanded to serve all of southwestern Connecticut from its Stamford headquarters and a Danbury office opened in 2004. HDF’s homebuyer assistance programs include its First Time Homebuyers Program, SmartMove low interest second mortgage program, CHFA (Connecticut Housing Finance Authority) approved Homebuyer Education Classes Program and Below Market Rate Program (BMR). HDF is a HUD-certified lender and Housing Counseling agency. The organization provides homebuyers with homebuyer finance, counseling and assistance programs.

HDF offers low-interest, flexible financing to developers through its Multi-Family Lending Program. HDF also offers technical assistance to municipalities, and works with the private sector, other nonprofits, and government entities to facilitate the development of more affordable housing. Through its Advocacy Initiative, HDF convenes symposia for business leaders and community decision makers featuring national, regional and local experts on important topics related to affordable housing and homeownership.

The organization manages public/private partnerships to lend funds for these affordable housing initiatives. It has the largest public/private pool of mortgage financing for affordable housing in Connecticut – both homeownership and multi-family development- $60 million.

The Housing Development Fund, Inc. is headquartered at 100 Prospect Street, South Tower Plaza, Stamford, Connecticut, and maintains an office at 8 West Street, in Danbury. For additional information call Tami Strauss at 203-969-1830 x19 or visit www.hdf-ct.org.