June 2023

Atlanta Urban Development Corporation

Leveraging public land to create high quality mixed-income housing

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GOALS

The City of Atlanta and its partners seek the creation of a specialized entity capable of
leading redevelopment of public land to achieve the following goals:
1. Build a new model of public land development not reliant on tax credits
2. Establish long-term affordability and control of housing on newly developed sites
3. Work with Invest Atlanta to implement the Atlanta City Council-approved
Housing Production Fund to provide critical capital for additional public land
projects
4. Add additional public land development capacity that compliments and
expands housing development efforts of the existing public agencies’ work

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RECOMMENDATIONS

1. Allocate $38M from the Housing Opportunity Bond which will be used to create a Housing
Production Fund (HPF), providing low-interest, mezzanine construction financing for AUDC-
partnered affordable housing projects.

2. Create a new Atlanta Housing affiliated entity, the Atlanta Urban Development
Corporation, focused on developing mixed-income housing on public land.

3. AUDC projects to be sourced primarily from City and public partners’ portfolio of public
land.

4. City would provide seed capital to establish and fund operations, acquisitions, and
establish initial equity for projects.

5. Utilize a lean, fee-based based staffing model where a private contractor would initially
operate the AUDC funded by the City of Atlanta seed capital.
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AUDC PARTNER ORGANIZATION CHART
GOVERNMENTAL

FINANCIAL ORGANIZATIONAL

CoA provides initial

operating budget, land
URFA acts as program administrator of for development AUDC incorporated through Atlanta
Housing Production Fund, including intake, HPF
Housing, with Atlanta Housing approving
underwriting, project approval, and Funding organizational powers, bylaws, and
closing. board appointments

AUDC’s Investment
Atlanta Urban
Committee recommends Development
projects for URFA funding
approval Corporation
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CASE STUDY: HOUSING OPPORTUNITY COMMISSION’S HOUSING PRODUCTION FUND
The Housing Opportunity Commission has pioneered a mixed-income housing model that has
cleared a 3k+ unit pipeline relying on public land and low-interest, municipally financed debt

• Montgomery County’s HOC (Maryland) partners w/ fee

developers to build mixed-income, mixed-use housing w/ (MONTGOMERY COUNTY MD)

no LIHTC built on public land

• 20% units @ 50% AMI, 10% units @ 80%AMI

• Use $50M fund to issue a revolving, low-interest,

mezzanine construction financing (Housing Production
Fund) for their own projects
• Fund is secured by County’s housing trust fund’s annual
$3M commitment
• Actual spend from trust fund is much lower than $3M
HOCs The Lindley, 200 units of mixed-income TOD
• The model’s successes have been recognized
• In 2022, County passed 2nd phase of $50MM
• State of MD proposing a state matching fund
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RECOMMENDATION #1
Allocate $38M from the Housing Opportunity Bond which will be used to create a
Housing Production Fund (HPF), providing low-interest, mezzanine construction
financing for AUDC-partnered affordable housing projects.

• Getting to 20k affordable housing units will require an increase in non-LIHTC affordable unit
creation. Public land is our best resource to do this.
• The Housing Production Fund is a low-interest, mezzanine construction financing fund for
non-LIHTC, new construction mixed-income, publicly-owned multifamily projects,
typically on public land.
• At least 30% of units will be affordable for households earning less than or equal to 80%
AMI with at least half of such units affordable for 60% AMI households or below.
• Deeper affordability can be achieved by marrying philanthropic and concessionary capital.
• Projects will be majority publicly-owned and have long-term affordability.
• Funds will be managed by Invest Atlanta, Housing Opportunity Bond Program Administrator.
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HOUSING PRODUCTION FUND FINANCING AND PIPELINE
• Revolvability: Loaned HPF funds will be repaid at
stabilization through permanent financing, within 4 to 5 CAPITAL STACK - CONSTRUCTION
years of construction start. Partner Equity

Equity
5-10% devel. costs
• Financial Self-Sufficiency: HPF would support majority of Public Equity
its portion HOB debt service. 0-10% devel. costs
• Leverage: Approximately $200MM in project loans can Housing Production Fund

debt
be issued over the 20-year life of the bonds with less than

HPF
20% devel. costs
$1M in annual City investment. 3-5% IR (below market)

• P3 Partnerships: Developer private partners will Conventional Construction

Conventional
contribute to public HPF and land investments. Financing

debt
60-75% devel. costs
• Phase I Pipeline of public land available for HPF will Market rate
include 3 to 4 projects. (possibly more favorable b/c of
risk reduction)
• Production: Projected to produce 400 affordable housing
units per phase (4 – 5 years), or 800 units by 2029.
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RECOMMENDATION #2
Create a new entity (Atlanta Urban Development Corporation) incorporated
through Atlanta Housing focused on developing mixed-income housing on public
land.
• Entity would be a wholly owned subsidiary of Atlanta Housing.

• Separate entity allows for a specialized board composition and direct accountability for
engagement and execution of development portfolio.

• Builds on internationally proven model of specialized public development corporations for

the specific purpose of developing select public land properties.

• Incorporation through Atlanta Housing creates flexibility for potential use of certain powers
under the Housing Authorities Laws as granted by Atlanta Housing.

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RECOMMENDATION #3
AUDC projects to be sourced primarily from City and public partner’s portfolio of
public land.
• The board will be comprised of 9 members: AH Board Chair, Mayor or their designee, City
Council CDHS Chair, Invest Atlanta CEO (non-voting), AH CEO (non-voting), and 4 seats appointed
by the AH Board

• AUDC will create an Investment Committee composed, in part, of local real estate, finance,
and/or affordable housing professionals to recommend projects for approval by AUDC board and
use of HPF funds by Invest Atlanta.

• City has identified 9 City-owned properties that are strong candidates for inclusion into the
AUDC’s portfolio.

• AUDC will work with public partners, including Atlanta Housing, to identify and potentially transfer
select properties within their portfolio. AH land transfers would be subject to AH Board and HUD
approval pursuant to federal disposition regulations. 9
RECOMMENDATION #4
City would provide seed capital to establish and fund operations, acquisitions, and
establish initial equity for projects.

• AUDC will require initial seed funding to support operations, including the hiring of
contractor staff. No AH or HUD funds will be used.

• The Mayor’s Office will work with City Council to identify and allocate necessary funds
and City-owned sites for the AUDC.

• This seed capital will also provide an initial equity source for Phase I of projects,
including initial costs for due diligence.

• There are no financial expectations or obligations of Atlanta Housing for AUDC other
than formation and appointment of Board of Directors, from time to time.
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RECOMMENDATION #5
Utilize a lean, fee-based based staffing model where a private contractor would
initially staff the AUDC.

• Initial staffing for the project would be sourced to a

private firm.
• This would allow the AUDC to be staffed immediately
with real estate industry professionals.
• Long-term intention is to staff the organization through
permanent, non-contract hires.
• Executive leadership would not have equity in the
projects but would be paid partially based on how fast CASE STUDY: ROWEN FOUNDATION
projects are constructed and leased up. Gwinnett County contracted with a private
consulting firm, HR&A, to initially staff the
• Additionally, AUDC support staff will be temporarily Rowen Foundation to acquire and lead
augmented by City staff. redevelopment of the 2000+ acre project
area.
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