62-Unit Apartment Complex for Low Income Seniors Opens in Richmond

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Financing was provided primarily by Mechanics Bank

WALNUT CREEK, Calif.–(BUSINESS WIRE)–The City of Richmond has 61 more units of housing for low-income seniors
now that the Harbour
View Apartments
, a 4-story property located at 25 Harbour Way in
downtown Richmond, CA has been completed. The $17 million project,
developed by The Pacific Companies (TPC),
was financed using a complicated financing structure involving
tax-exempt bonds, a forward interest rate swap and federal low income
housing tax credits (LIHTCs). The bonds were issued in two series with
Mechanics Bank directly purchasing $9 million of the senior series and a
private investor purchasing $4 million of the junior series. Wells Fargo
Affordable Housing Community Development Corporation committed to
purchasing the LIHTCs.

“This project was a great fit for us,” says Bruce Lofgren, vice
president, the Mechanics Bank lender who led the bank’s involvement. “We
already have a major commitment to help create affordable housing in
Richmond and in this case, we had the privilege of working with an
experienced and respected affordable housing development firm that
specializes in developing and operating LIHTC properties in California
and other western states. Our ability to understand the complexity of
the financing structure and our involvement in the City of Richmond made
Mechanics Bank the best choice for financing this project.”

The four-story, elevator-served, wood and steel frame structure contains
62 apartment units, including 50 one-bedroom units and 12 two- bedroom
units (including a manager’s unit). Other project improvements include a
community room, laundry room, manager’s office, elevator lobby, storage
areas, three reading lounges, craft room, fitness room, and a community
garden area. With the exception of the manager’s unit, the apartment
rents are affordable to senior (55+ years old) households with incomes
at or below 50% and 60% of the area median income as published by HUD.

Lofgren, a 30-year veteran in real estate finance who spent about 13
years in the community lending group at Bank of America before joining
Mechanics Bank in 2005, says, “This project fills a demonstrated need in
the Richmond community and offers many other benefits as well. It was
built on a dilapidated industrial site that was an eyesore and was
bringing down property values in the area. With high quality new
construction there now, property values have the potential to improve
and the whole neighborhood will be affected positively.”

Mechanics Bank also recently purchased $3 million of Social Impact Bonds
that Richmond
Community Foundation
(RCF) will use to acquire, rehabilitate and
sell blighted homes throughout the City of Richmond. It’s the first time
SIBs have been used for this purpose. For more information about the
bank go to www.mechanicsbank.com.

Contacts

Mechanics Bank
Hatti Hamlin, 925-872-4328
HattiHamlin@comcast.net