- Long-Term Ownership by Non-Profits
For some non-profits, long-term ownership is ideal. It can allow the non-profit to maximize the financial benefits and maintain control of property it owns. Here are some of the key questions to consider before assessing a development project and the option of long-term ownership: What are the non-profit’s goals for development of an under-utilized property?
- Raise capital for missions, essential capital improvements, and/or ongoing operations?
- Create affordable housing as a mission?
- Upgrade space for current programs or create new space for future services?
Key factors to consider before undertaking a development project:
- What can be built on the site under current zoning?
- What population does the non-profit wish to serve?
- Which public subsidy programs, if any, are most feasible for the project and which are consistent with the non-profit’s goals for the development?
- Does the non-profit prefer to sell, lease or continue to own the property?
What are the benefits of developing rental housing with a developer-partner, through a site development agreement (the “turnkey” model)?
- Model can create units with affordable rents
- Potential for maximizing financial benefits for the non-profit
- Potential for minimizing the financial risk to the non-profit through a “Site Development Agreement”
What does ownership of the project mean for the non-profit?
- Non-profit contributes land and receives payment for the land
- Non-profit receives share of cash flow over 15 years and all cash flow thereafter
What is the Site developer’s role in the development process?
- Assembles an experienced development team
- Oversees design and construction
- Obtains financing commitments (debt and equity)
- Provides pre-construction funds and guarantees for the financing, as needed
- Provides for professional, long-term management and operation of the property
- Retains minority interest in general partnership, if required by lender or investor
- Receives share of developer fee
We can assist you in assessing the options for your non-profit.
We offer a range of services, including site selection, feasibility analysis, assembling financing and project management. We specialize in finding debt and equity financing optimized for your residential development projects. We also can help assemble the team of professionals needed to complete your projects efficiently and effectively. Your team may include architects, engineers, attorneys, general contractors and property managers.