Compounding Interests, Compounding Inequities


Victory Crossing

Silver Spring, MD

Victory Crossing is a 105-unit, new construction apartment community for mixed-income seniors located in the White Oak area of Silver Spring at 1090 Milestone Drive. The property is situated on 2.5 acres leased from Montgomery County under a 75-year ground lease.

The unit mix includes 80 1 BR and 25 2BR units (of which 10 are market-rate). Forty-nine (49) of the units – 38 1 BR and 11 2 BR - have 20-year project-based voucher rent subsidies provided by the Housing Opportunities Commission of Montgomery County (HOC). Victory Housing partnered with HOC to transfer these 49 households so that HOC could redevelop a nearby property under the HUD RAD program. HOC also made a $1.8M contribution to Victory Housing, which was subsequently loaned by Victory to the project to pay the entire 75-year cost of the ground lease at closing.

Common amenities include a library with aquarium, computer room, sunroom, community room with fireplace, pantry / warming kitchen, wellness room, fitness center, billiards, and WiFi. The community is smoke-free and the units have washers and dryers. Victory Crossing earned a LEED Silver designation.

Resident services include partnerships with local nonprofit service providers, monthly deliveries from area food banks, and scheduled trips from a Victory Housing passenger van.

Financing included the first use of the Freddie Mac Tax-Exempt Loan (TEL) program on an affordable housing project in Maryland. Specifically, the plan included a $11.3 construction / $7.7M permanent Maryland Community Development Administration (“CDA”) tax-exempt loan / TEL loan; $5.8M in 4 % tax credits syndicated by Hudson Housing Capital, a CDA Rental Housing Works loan of $2.5M, Montgomery County loans totaling $5.4M; and the Victory Housing loan of $1.8M. The construction loan was provided by Capital One.

Paca House Apartments

Baltimore, Maryland

The redevelopment of Paca House converted single room occupancy units (SRO’s) without kitchens and baths, into 92 fully furnished apartments (41 efficiencies and 51 one bedroom units) and provides significant amenities, including a computer lab, library, lounge, two community meeting rooms, on-site laundry and free Wi-Fi in all common areas. Of the project’s 92 units, 10 are unrestricted; these one-bedrooms are currently leased to Veteran’s Affairs Supportive Housing (VASH) voucher recipient holders through a partnership with the U.S. Department of Veterans Affairs.

Paca House Partners LP, a joint venture between Somerset Development Company, New Community Partners (NCP) and Volunteers of America Chesapeake (VOAC), acquired Paca House in July 2018. Construction was completed and achieved 100% qualified occupancy in December 2019. This project leveraged numerous local partnerships, including the Coordinated Access Referral System, through which homeless persons are prioritized, provided urgently needed medical services and routed expeditiously to Paca House.

Paca House was designed by Waldon Studio Architects with Harkins Builders, Inc. as the General Contractor. The original building included an historic Baltimore City Fire House, an early 20th century warehouse building and an addition connecting the two buildings. It opened in 1996 as a Low Income Housing Tax Credit (LIHTC) project. The redevelopment added a new addition on a vacant parcel along North Paca Street, doubling the affordable square footage of the building to approximately 73,000 square feet.

Paca House was awarded $1,500,000 in annual credits by the Maryland Community Development Administration (CDA). The credits were syndicated by Boston Financial Investment Management. Capital One Bank is the LIHTC investor and construction, bridge and permanent lender. The Project’s fifteen sources of financing leveraged approximately $2.4M of hard debt, $15.2M of private equity investment and $9M of subordinate debt financing. The project’s total development costs are approximately $26 million (approximately $317k per LIHTC unit), of which construction costs comprise approximately $14 million. Each LIHTC unit used $18,292 of annual federal tax credit allocation.

Soft loans were provided by: Maryland CDA; the Baltimore City Department of Housing and Community Development; the Federal Home Loan Bank of Pittsburgh via Fulton Bank; Volunteers of America National Services; and VOAC. Grants were provided by: The Harry and Jeanette Weinberg Foundation; The Home Depot Foundation; Northrup Grumman and Citi Community Development via the Local Initiatives Support Corporation. Paca House will remain affordable for at least 40 years. The project’s 20-year HAP contract allows Paca House to serve households earning 30% Area Median Income (AMI) or below, and 50% AMI or below.

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