ABOUT THE DEVELOPERS OF TAX CREDIT PROPERTIES

In addition to the standard accepted skills that are required from a developer, the developer of affordable housing has to be proficient in three other areas as well. They are:

The Federally-Mandated Point Allocation System. This point system is administered by each state to qualify potential developers and is designed to insure that each development is economically sound and built by a qualified developer. In this complicated due diligence process, points are awarded based on, among other things, experience, solvency and the needs of the community.

The Numbers First Approach to developing affordable housing. As discussed, economic factors are dictated in advance by various government agencies. It is the task of the developer to find properties that will fit the numbers, assuring economic viability.

The political and civil service bureaucracy. For a developer to take advantage of all the potential subsidies, they have to understand how to deal with a number of different government agencies.

In the past, Nonprofit entities have specialized in being the primary developers of affordable housing. With the ever increasing number of developers trying to enter the industry, competition for the limited number of Tax Credits has increased. When you take into consideration the thorough due diligence Point Allocation System required by the government to prove economic viability, the best endorsement and statement of qualifications for a developer of affordable housing may be the fact that they have qualified for the Tax Credits to begin with.