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Peter Duffley and Anna Short-Slightom represented CAHEC New Markets, LLC (“CAHEC”) in a new markets tax credit (“NMTC”) transaction to finance the construction of a new YMCA facility in Southeast Raleigh. Phil Runkel and Alison Kling assisted with real estate matters, and Susan Cooper assisted with environmental matters.
Womble helped CAHEC allocate $15 million in NMTCs for the $21.7 million development. Womble negotiated, prepared and reviewed critical transactional documents, ranging from various loan agreements, organizational documents and fee arrangements, to tax and enforceability opinions. Peter and Anna assisted CAHEC in their role in the NMTC transaction as a community development entity (“CDE”) by structuring the transaction to ensure the NMTC requirements were met while also meeting CAHEC’s business concerns.
The Southeast Raleigh YMCA is part of a 114,868 SF building that will be shared with a Wake County public elementary school. The Southeast Raleigh YMCA and elementary school are the first phase of a master planned community known as the Beacon site in a severely distressed area of Raleigh, NC with a poverty rate of 21.6% and an unemployment rate 1.84 times the national average. The 31-acre Beacon site will be a driver of improved health, wellness, education, affordable housing, and economic development in southeast Raleigh.
Enacted in 2000, the NMTC program is designed to stimulate economic and community development and job creation in low-income communities by attracting investment capital from the private sector. Taxpayers invest equity capital in qualified CDEs (such as CAHEC) in exchange for a credit against their federal income taxes. In turn, CDEs are required to invest the proceeds in low-income communities that have traditionally been unable to attract conventional financing.
CAHEC New Markets, LLC is a subsidiary of Community Affordable Housing Equity Corporation and is recognized by the U.S. Department of the Treasury’s CDFI Fund as a CDE.
