We are excited to launch a series of blog posts highlighting the benefits available to real estate development projects through the use of tax credit financing and our work in this industry.
At Brian Wishneff & Associates (BW&A), our passion is to promote the revitalization of communities, and to help organizations and real estate developers across the country looking to do the same, through the rehabilitation of America’s historic buildings. There is an incredible wealth of American history lying within these historic structures. While many of these buildings remain blighted and vacant today, extremely significant economic opportunity, both private and public, is very easily unlocked through the use of one of the oldest and most successful financing incentives available for real estate development projects, and indispensable to organizations looking to renovate or rehabilitate a historic structure: the Federal Historic Tax Credit.
The Federal Historic Tax Credit (“FHTC”) is the nation’s largest federal incentive promoting urban and rural revitalization through private and public investment in reusing historic buildings. Since the HTC program’s inception in 1977, more than 44,000 rehabilitation projects have been undertaken representing over $96 billion of investment in rehabilitation, approximately 600,000 new and rehabilitated housing units have been produced, including more than 166,000 low- and moderate-income housing units, and over 2.5 Million jobs have been created, as of 2018.
The program provides a tax credit of 20% of qualified expenditures, which can be monetized into cash from a third-party investor, who contributes equity to the project. Depending on a number of factors, Federal Historic Tax Credits (“FHTCs”), can cover between 10-15% of the construction budget of a qualifying project. 36 states also have companion programs of some kind that “piggy-back” off of the Federal program. Projects can usually take advantage of both State and Federal programs, which together can often represent up to 35% of your development budget. The best part about these programs is that there is no restriction on how this money can be used.
BW&A is a full-service real estate consulting and syndication firm that specializes in the finance and operations of tax credit enhanced development projects. Since 1995, we have worked on over 200 Historic Tax Credit projects across 36 states and the District of Columbia, serving a myriad of clients ranging from for-profit developers, to non-profit organizations, municipalities, IDAs, universities, business owners, housing agencies, and many other entities in a variety of industry segments looking to take advantage of tax credits. We are also a developer of historic buildings ourselves. Focusing most of our work on high-impact incentive programs such as Historic, New Market, Low-Income and Renewable Energy Tax Credits, BW&A has been able to secure over $600 million of equity for our clients since our inception. Our next post will highlight how we specialize in helping even small not-for-profit projects to take advantage of tax credits.
For information about tax credits and how BW&A can help, please contact us today.
