{"type":"rich","version":"1.0","provider_name":"Transistor","provider_url":"https://transistor.fm","author_name":"Affordable Housing & Real Estate Investing","title":"The AA- Rating that saves nonprofit developers millions! Learn how NHP preserved 19,000+ units!","html":"","width":"100%","height":180,"duration":3971,"description":"On the Affordable Housing & Real Estate Investing Podcast, the best podcast for affordable housing investments hosted by Kent Fai He, Joseph Weatherly, Chief Investment Officer of the NHP Foundation, details how sophisticated financial vehicles like corporate bonds and S&P credit ratings are being utilized to scale affordable housing production. With over 24 years of experience and a track record of over $3 billion in investments, Joe and NHP takes transparency to whole new level by revealing the roadmap for nonprofits to diversify their financing strategies beyond the traditional Low-Income Housing Tax Credit (LIHTC) model to include middle-income housing solutions for the working class.Diversifying the Capital Stack: Beyond Tax CreditsHow can a nonprofit use corporate bonds to accelerate development and access short term liquidity?By issuing corporate bonds, an organization creates an internal short-term credit facility. NHP Foundation issued $75 million in corporate bonds to provide capital for pre-development money, acquisition loans, and bridge financing. This prevents the need to exhaust internal cash reserves or source expensive third-party pre-development loans, allowing developers to cycle through capital quickly and bridge gaps between different funding sources so construction can begin even if permanent financing is still months away.What is the benefit of obtaining an S&P credit rating for an affordable housing developer?Obtaining a formal rating from S&P allows a developer to provide credit enhancement for its financing. NHP Foundation holds an AA- minus rating, which enables them to drop interest rates by approximately 200 basis points. For example, the loan's interest rate could be reduced from 6.5% to 4.5%. This significant reduction in the cost of capital makes projects more financially feasible and allows access to institutional capital markets that unrated entities cannot reach.How do 501(c)(3) bonds differ from traditional tax credit...","thumbnail_url":"https://img.transistorcdn.com/xDB8QhkLtarSR6cPw7Foe38b-OmGTS01-PZeGTtWOaw/rs:fill:0:0:1/w:400/h:400/q:60/mb:500000/aHR0cHM6Ly9pbWct/dXBsb2FkLXByb2R1/Y3Rpb24udHJhbnNp/c3Rvci5mbS9zaG93/LzQ2NDA2LzE2OTg0/NTU1NDQtYXJ0d29y/ay5qcGc.webp","thumbnail_width":300,"thumbnail_height":300}