Leading financial services provider Merchants Capital announced more than $66.3 million in total financing for the new construction of Maple Block Flats, a 204-unit workforce housing project in Petoskey, Michigan, a growing vacation destination.
Merchants Capital provided a $29.6 million Freddie Mac Unfunded Non-LIHTC Forward permanent loan for the development, and its parent company, Merchants Bank, provided a $36.7 million construction loan.
Maple Block Flats is the first project in Michigan to receive Michigan State Housing Development Authority (MSHDA’s) Affordable Housing Tax Increment Financing (AHTIF), which accounts for $6 million of the $14 million in tax increment financing being granted for the development. More than $12 million was provided in state grants and loans, with strong support from Michigan Economic Development Corporation (MEDC); the Michigan Department of Environment, Great Lakes and Energy (EGLE); the City of Petoskey; the Emmet County Brownfield Redevelopment Authority and numerous local businesses.
“This was a very collaborative effort to springboard affordable housing development in Petoskey and keep pace with its growth,” said Brian Shelbourne, Vice President of Originations at Merchants Capital. “We are proud to deliver key components of the capital stack and look forward to working with Great Lakes Capital to bring additional workforce housing solutions to the area.”
Maple Block Flats will feature seven garden-style apartment buildings with 18 studios, 72 one-bedroom units and 114 two-bedroom units. Fifty percent of the units will be restricted to residents who earn between 60% to 120% of the area median income (AMI). Ten percent of the total units will be income and rent restricted for those making less than 80% of the AMI.
“Our construction loan closing is the culmination of over three years of pre-development work on a very challenging project,” said Jeff Smoke, Managing Director and Principal at Great Lakes Capital. “We were able to work with Merchants to close a complicated capital stack that involved incentives from five different government entities, with the MDSHA Missing Middle incentive being the most impactful. This is a catalytic project for Northern Michigan and our second in the region. We look forward to providing more large scale housing solutions for West Michigan communities, utilizing the state’s newly created housing development incentives.”
Maple Block Flats is being developed by real estate development and private equity firm Great Lakes Capital, specialists in multifamily properties; including affordable housing, mixed income and market rate; medical office; general office and retail. The company has invested more than $1.9 billion in real estate projects throughout the Midwest and western United States.
Each unit at Maple Block Flats will contain a washer/dryer, solid surface countertops, efficient HVAC and vinyl plank flooring. In addition to the clubhouse, residents will also have access to pickleball courts, a pool, playground and dog park.
