Tyler, TX; 50 Units; Market Rate Apartments
Lake Park Duplexes is a 50-unit apartment community to be built in Tyler, Texas. The three-bedroom, two bathroom units will feature private entrances and driveways and provide young families with an affordable alternative to single-family home ownership. The developer looked to Rockhall and FHA’s attractive new construction loan program to finance the project.
Multifamily/HUD Experience. The owner, while a seasoned real estate developer in the retail space, lacked multifamily and HUD development experience. Rockhall identified and surrounded the developer with a qualified, HUD experienced development team to help ensure the success of the project.
Housing Market. HUD rejected the initial pre-application over concerns about the market. However, Rockhall appealed and demonstrated the demand for the proposed development, pointing to the overall supply shortage and other positive trends in the market (i.e. the recent development of high-end single family homes and proximity to recently built supporting schools, shopping, and retail.)
Meeting HUD’s Green Standards. HUD released its new guidance on reduced Mortgage Insurance Premiums (MIP) for Green Projects after the design was already completed and the application was in processing. Rockhall worked with HUD, a qualified energy consultant, and the design architect to redesign the project to meet Energy Star guidelines.
Rockhall successfully convinced HUD of the demand for the project and secured attractive FHA new construction financing. The loan financed 85% of development cost, locked in a low interest for the construction period plus a 40 year term, and secured the Green Project reduced MIP rate. Construction is currently in process and is expected to be completed within 12 months from initial closing. The project will provide much needed quality family and work-force housing in a growing market.