Middleburg, a Virginia-based investment, development and management firm, has closed Middleburg Workforce Housing Fund with the $91.0 million acquisition of three apartment communities in Atlanta, GA. The properties include:
Middleburg will execute a strategy at each property that includes a substantial renovation of the physical assets to greatly improve housing quality with an emphasis on maximizing energy efficiency to preserve affordability and lower total housing cost for our residents. In addition, Middleburg will provide responsive community programs to its residents and engage the local community through job fairs, after school programs, and continuing education for adults.
“Vacant properties in disrepair are magnets for crime and unsafe for the few residents actually living there,” said Middleburg Managing Partner, Chris Finlay. “Our holistic approach will transform these properties and also the surrounding communities. Middleburg is uniquely capable, with fully integrated development, construction and management operations, to bring these communities to life as fundamentally new assets; not just preserving but adding to the inventory of workforce housing available to the many people desperately seeking homes they can afford.”
The Fund, announced in January 2019, was launched with the contribution of a previously acquired property, Vesta Derby Oaks, in Louisville, KY. Including debt, the Fund deployed approximately $120.0 million in the four properties, and will now focus on executing the respective strategies including full renovations. Middleburg has partnered with KeyBank Real Estate Capital Community Development Lending and Investment (CDLI) and Capital Bank for construction financing of the Atlanta portfolio. “CDLI and Capital Bank mirror our interest in investments that provide safe, secure and affordable rental housing and provides cost effective capital to promote this initiative,” stated Kory Geans, Chief Investment Officer for Middleburg.
“KeyBank is proud of our continued partnership with Middleburg to deliver quality, innovative and affordable rental housing to communities,” said Tiffany Durr, a senior relationship manager with CDLI. “KeyBank’s full service financing platform and collaboration with Middleburg and Capital Bank allowed us to create a customized financing solution for the acquisition and renovation of these properties.”
“One of our key priorities is to foster economic development and strengthen the communities we serve,” said Rick Manley, Mid-Atlantic market president of Capital Bank. “Last year, our company announced our Community Benefits Plan that commits nearly $4 billion to broaden access to financial resources across our footprint. This strategic partnership with Middleburg aligns with our efforts to strengthen our underserved communities by providing access to affordable housing.”
Middleburg, utilizing internal research and asset management teams, will carefully track and measure the success of the redeveloped properties, looking at data before and after renovation to continuously adjust its programs and report back to its investors. The four critical areas of focus from a reporting standpoint are: Affordability, Housing Quality, Environment, and Community Engagement.
Given the tremendous demand that exists for workforce housing, Middleburg has initiated conversations with social impact focused institutions and accredited investors to participate in the company’s next community impact fund, Middleburg Community Impact Fund II, in order to continue restoring, transforming and preserving critical workforce housing and their surrounding communities throughout the Southeast U.S.
“Middleburg is thrilled with the strong interest in our initial Workforce Housing Fund from family offices and social impact-minded investors,” said Alonso Garza, Head of Funds Management. “Our reputation as a meticulous asset manager with top notch operational teams has supported the launch of this new direction that takes our longtime interest in the transformation of workforce housing and their respective communities to a higher level.”
About Middleburg: Middleburg is a fully integrated multifamily development, investment, and management company operating in the southeastern and mid-Atlantic United States. Since 2004, Middleburg has acquired and developed more than 16,000 apartment units, executing approximately $2.0 billion in transactions. The Middleburg team shares a vision for greater value creation through community impact. The firm’s success is rooted in a genuine desire to serve its local communities in thoughtful and holistic ways. Middleburg embraces people, property, and partnerships to enhance the lives of others, contribute positively to its neighborhoods and maximize real returns for partners. For more information, please visit www.LiveMiddleburg.com.
About Key Community Development Lending/Investment
KeyBank Community Development Lending and Investment (CDLI) helps fulfill Key’s purpose to help clients and communities thrive by financing projects that stabilize and revitalize communities. Experts in complex tax credit lending and investing, Key is one of a handful of affordable housing lenders in the country with a platform that brings together balance sheet, equity, and permanent loan offerings. For its ability to lend to, invest in, and serve its communities – especially low-to-moderate income communities – KeyBank has earned nine consecutive “Outstanding” ratings on the Community Reinvestment Act exam, from the Office of the Comptroller of the Currency.
About Capital Bank: First Tennessee Bank National Association operating as Capital Bank and First Tennessee Bank, is one of the five largest regional banks headquartered in the Southeast, with more than 250 branches and the largest deposit market share in Tennessee. Capital Bank, First Tennessee Bank, FTB Advisors, and FTN Financial are part of First Horizon National Corp. (NYSE:FHN). The company’s banking subsidiary was founded in 1864 and has the 14th oldest national bank charter in the country. FTB Advisors wealth management group has more than 300 financial professionals and about $4.8 billion in assets under management. FTN Financial is a capital markets industry leader in fixed income sales, trading and strategies for institutional customers in the U.S. and abroad. The company has been ranked by American Banker magazine among the Top 10 Most Reputable U.S. banks and as one of the nation’s best employers by the National Association for Female Executives and Fortune magazine. More information is available at www.capitalbank-us.com.