Greystone Real Estate Capital has closed its first LIHTC investment vehicle at $103 million. Proceeds will fund the development and preservation of 959 income-restricted units across 11 projects.
The developments are spread across Louisiana, Massachusetts, Mississippi, New Jersey, Ohio and Pennsylvania. This undertaking is estimated to generate some 1,100 jobs and $132 million in wages and business revenue.
Seven institutional investors operating in the financial and insurance sectors pledged capital toward the fund, which launched last year together with Greystone’s new LIHTC platform.
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Yet, this isn’t the company’s first foray into the affordable market. Greystone has been involved in the sector as a government-sponsored enterprise and Federal Housing Administration lender.
Earlier this year, Greystone issued a $90 million Fannie Mae loan to Metropolitan Realty Group for the refinancing of Cromwell Tower Apartments, a 317-unit affordable community in Yonkers, N.Y. The property caters to residents earning up to 60 percent of the area median income.
LIHTC alterations to boost affordable development
LIHTCs are instrumental as developers are looking to navigate and fill in the intricate layers of the affordable capital stack. More than 300 different federal, state and local stipends were instrumental in the financing of the 27,000 fully affordable properties in Yardi Matrix’s database as of July, according to the firm’s affordable housing report.
The most widespread program—tax-exempt private activity bonds—is packaged with 4 percent LIHTC. Currently, this type of financing must not account for more than 50 percent of land and building cost; however, the One Big Beautiful Bill Act changes that starting next year, lowering the threshold to 25 percent and allowing more projects to pencil out.
The bill also increases the 9 percent LIHTC allocation by 12 percent in 2026. Such projects typically involve ground-up developments, as opposed to 4 percent undertakings, which center around rehabilitation. All in all, LIHTC investment could push past the $15 billion mark over the next 10 years, according to Nelson Mullins.
Other LIHTC investment vehicles that recently closed include Walker & Dunlop’s Fund 124, which raised $240 million for the development of 1,701 affordable units, and PNC’s Fund 98, which amassed $208 million to finance the construction and rehabilitation of more than 2,000 income-restricted apartments.
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