Miami-based Atlantic Pacific Companies is requesting a $3.8 million loan from Miami-Dade County to address unexpected cost overruns on three affordable housing developments. These projects, collectively offering 470 units, are crucial for providing housing to low and moderate-income households in the region. The loan would be funded by money previously repaid to the county by Atlantic Pacific from a completed project.
Key Takeaways
- Atlantic Pacific Companies is seeking a $3.8 million loan from Miami-Dade County.
- The funds are needed to cover cost overruns on three affordable housing projects totaling 470 units.
- The loan would be a redeployment of funds previously repaid by Atlantic Pacific to the county.
- The county commission will vote on the loan request.
Loan Details and Project Breakdown
Miami-Dade commissioners are set to vote on whether to reallocate $3.8 million in surtax funds to Atlantic Pacific. This financing typically features a two-year interest-free period followed by a 0.75 percent interest rate over a 30-year term. The requested funds are earmarked for three specific projects:
- Perrine Apartments II: This age-restricted development in south Miami-Dade will receive $1.6 million. It will feature 150 units, including studios, one-bedroom, and two-bedroom apartments, reserved for households earning 30% to 80% of the area median income (AMI). Construction was 20% complete as of September, with an expected third-quarter completion.
- Brownsville Village V: This project in Brownsville is slated to receive $1.2 million. It will comprise 120 units (28 studios, 92 one-bedrooms) for households earning 30% to 80% of the AMI. The project has faced significant labor and materials cost increases, totaling $1.8 million, due to a nearly two-year delay stemming from ground lease issues with Miami-Dade, which owns the land. Completion is anticipated in the fourth quarter.
- Northside Property III: This development will receive $1 million of the loan. It is planned to have 200 units (50 studios, 150 one-bedrooms) in an unincorporated area of the county, with rents targeted at those earning 30% to 70% of the AMI. "Significant unforeseen costs" of $1.4 million related to underground utility relocation are impacting this project. Construction was 95% complete as of September, with an expected fourth-quarter completion.
Context of Affordable Housing Financing
The $3.8 million loan would be redeployed from Atlantic Pacific’s recently completed 110-unit Amber Garden development. Affordable housing developers in South Florida frequently utilize various creative financing strategies to maintain lower costs and offer below-market rents. Mechanisms like the federal Rental Assistance Demonstration (RAD) program, which allows developers to lease public housing complexes from the county at a discount in exchange for building affordable units, are common. Miami-Dade has seen approximately 10,000 units approved under RAD in the past year. Local governments and their Community Redevelopment Agencies also often provide grants and loans to support these developments.
Sources
- Atlantic Pacific Seeks County Loan for Affordable Projects, The Real Deal.