NewPoint, a real estate finance company, today announced the launching of NewPoint Impact, an affordable housing platform that will connect “private capital with government-subsidized products,” according to a press release.
The launch was a partnership between the company and Morgan Properties, a Pennsylvania-based real estate investment and management company for multifamily housing.
Rob Wrzosek, NewPoint’s president of Affordable Strategies, will oversee the operations between NewPoint’s Proprietary Affordable Team and its originators and mortgage broker partners to provide customized products to its customers. The release also noted that loans through the platform start at $8 million, will have terms between two and 40 years “depending on the execution”, and are available for both for-profit and nonprofit developers.
“Our goal with the NewPoint Impact products is to provide investors and developers with something fundamentally different in a sector that has remained relatively unchanged in recent years, despite a market that has evolved,” Wrzosek said in the release. “These solutions solve for contemporary challenges and provide additional certainty in creating and preserving desperately needed affordable housing during an increasingly volatile environment.”
With the help of these financial solutions, NewPoint Impact says it will fund the construction and acquisition or rehabilitation of affordable housing.
This comprises four provisions, namely a 4% tax-exempt bond financing along with a 4% LIHTC program, 4% Fannie Mae M.TEBs. or a municipal bond, a Synthetic 221(d)(4) which can “underwrite” FHA 223(f) financing and Resyndication Bridge Loan for repositioning of affordable housings.
David Brickman, CEO of NewPoint, says the new product will transform multifamily finance through affordable housing finance.
“We have already established an affordable housing platform comprised of the foremost experts in Fannie Mae, Freddie Mac and FHA executions – now, through our partnership with Morgan Properties, we have created additional tools to bring unmatched value, speed and creativity to the organizations working to solve our nation’s affordable housing crisis,” Brickman said in the release.
Morgan Properties also created its Special Situations platform for investment opportunities. It is also a participant in Freddie Mac K Series investors and has acquired 29 B-Piece deals across $28 billion in loans, the statement says. It also partnered with Wilshire Lane Capital, a California-based venture capital firm, with the aim of identifying startups to invest in and test its technology across its multifamily portfolio in January 2022, as reported by FinLedger.
NewPoint says the partnership will also enable Morgan Properties to provide liquidity to the affordable housing sector. Jason Morgan, principal and president of Morgan Properties Special Situations, explained that there is a dearth of such housing in the U.S., and says the company aims to make renting more accessible to people.
“Partnering with NewPoint is a great opportunity to not only lend our expertise and expand our credit platform, but also help developers jumpstart construction on these critically-needed affordable housing projects,” he added.
The statement also added research on rental households in the country, stating that almost 25% of this population spends more than half of their income on rent. To alleviate renters from this problem, NewPoint Impact was created with input from developers to provide financing to make housing affordable, it also said.
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