Asset Management Forum Allen Feliz TCAM 186 Lincoln Street Boston MA (617)

Transcription

1 NCSHA Housing Credit Connect 2013 San Francisco June 24, 2013 Asset Management Forum Allen Feliz TCAM 186 Lincoln Street Boston MA (617)

2 What is Asset Management? Collecting, monitoring and analyzing information To take action and make decisions that Maintain and maximize performance of the asset 2

3 What is being managed for whom? Residents Loan serviced and repaid Lender(s) Quality, affordable housing Tax benefits Tax Credit Investor Community Compliance Allocators Profits Owner 3

4 Why Asset Management Matters It reduces risk by identifying and addressing small problems before they become big problems It improves performance and increases value It provides the information and wisdom to prepare for and make decisions when the time comes It provides a feedback loop on program effectiveness and market conditions 4

5 Major Components of Asset Management 5 Financial Monitoring Site Inspections Market Analysis GP/Management Agent Health and Performance Compliance Reporting Risk Rating Refinancings Workouts

6 Industry Trends and Hot Topics 6 Property performance Most LIHTC properties continue to perform well LIHTC Compliance still not a major issue around the industry Data still a challenge in tracking and managing performance National fiscal trends and their potential impact on housing programs Much talk about this elsewhere in the conference With respect to asset management, key issues include: Sequestration Pressure on real estate tax abatements and exemptions Increasing concerns about rental assistance funding risks (e.g. Project- Based Section 8) Rental Assistance Demonstration (RAD) Aging portfolios and the need for recapitalization Growing needs among state housing finance agencies and housing authorities State s asset management experience with TCAP and Section 1602 TCEP Properties

7 Preservation Needs/Tax Credit Properties Ready for the Next Stage Number of properties beyond 10-year credit period 16,754 15,485 13,967 12,483 10,998 9,679 15,400 13,400 11,400 9,400 7,400 5,400 3,400 1,400 1,406 2,740 4,106 5,458 6,962 8,

8 Disposition Landscape General Overview GP in charge Residual value varies greatly Tax implications Transactions are all complex Opportunities Capital market conditions still excellent Solve problems charitable contributions 8 Challenges Limited control Plenty of properties not worth debt Multiple approvals often necessary

9 Current Needs/Concerns Among State Housing Agencies and Housing Authorities Building/enhancing internal capacity to perform asset management Organizational structure Data systems and reporting Coordination between production (e.g. allocations and/or development) and asset management Debt asset management (e.g. monitoring of soft loans) Recapitalization for Post Year 15 properties Workout support 9

10 Asset Management for TCAP and Section 1602 TCEP Properties What is different? The tax credit allocating agency s new role and extra oversight of the GP/management agent Clear and organized properly level data and cooperation of GP/management agents are keys to effective ARRA asset management Asset management staffing and processes could vary from one organization to another, but effective asset management requires immediate, comprehensive and focused oversight 10

11 About TCAM 11 Mission: Provide high-quality, comprehensive, independent asset and portfolio management services to capital providers in the affordable housing and tax credit industries Client focus Long-term fiduciary perspective Independence: not associated with syndicators and not dependent on the next deal s origination fees Clients benefit from Deep expertise in a specialized industry Customized and flexible solutions Senior level attention

12 Full Range of Asset Management Services Direct Asset Management Shadow Asset Management Consulting Services Oversee property manager or developer/gp For state agencies, owners, GPs, investors, lenders Oversee syndicator or asset manager For housing authorities, guarantors, lenders For state agencies, housing authorities, owners, investors, syndicators, lenders 12

13 TCAM Experience TCAM s engagements have helped clients manage: 800+ Affordable Rental Properties 120,200 Apartment Units $5+ Billion Capital in 46 + Washington, DC and Puerto Rico States 13

14 A Mix of Corporate, Public and Non- Profit Clients 14