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What changed in Greystone Housing Impact Investors LP's 10-K — 2022 vs 2023

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Paragraph-level year-over-year comparison of Greystone Housing Impact Investors LP's 2022 and 2023 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2023 report.

+653 added−639 removedSource: 10-K (2024-02-22) vs 10-K (2023-02-23)

Top changes in Greystone Housing Impact Investors LP's 2023 10-K

653 paragraphs added · 639 removed · 483 edited across 6 sections

Item 1. Business

Business — how the company describes what it does

71 edited+13 added−11 removed69 unchanged
Biggest changeThese properties also compete by offering quality apartments in attractive locations and provide tenants with amenities such as recreational facilities, garages, services and pleasant landscaping. 12 Recent Developments Recent Investment Activities The following table presents information regarding the investment activities of the Partnership for the years ended December 31, 2022 and 2021: Investment Activity # Amount (in 000`s) Retired Debt (in 000`s) Tier 2 income allocable to the General Partner (in 000`s) (1) Notes to the Partnership`s consolidated financial statements For the Three Months Ended December 31, 2022 Mortgage revenue bond advances 8 $ 91,040 N/A N/A 6 Mortgage revenue bond redemptions 2 6,029 N/A N/A 6 Governmental issuer loan advances 6 18,955 N/A N/A 7 MF property sold 1 29,033 $ 24,229 N/A 8 Investments in unconsolidated entities 2 10,912 N/A N/A 9 Property loan advances 4 46,439 N/A N/A 10 Taxable mortgage revenue bond advances 3 2,980 N/A N/A 12 Taxable governmental issuer loan advance 1 4,000 N/A N/A 12 For the Three Months Ended September 30, 2022 Mortgage revenue bond advance 1 $ 1,623 N/A N/A 6 Mortgage revenue bond redemption and paydown 2 11,577 $ 10,420 N/A 6 Governmental issuer loan advances 7 39,820 N/A N/A 7 Investments in unconsolidated entities 2 2,524 N/A N/A 9 Return of investment in unconsolidated entity upon sale 1 7,400 N/A N/A 9 Property loan advances 6 22,742 N/A N/A 10 Property loan redemptions 3 27,081 N/A N/A 10 Taxable mortgage revenue bond advance 1 2,300 N/A N/A 12 Taxable governmental issuer loan advances 3 3,000 N/A N/A 12 For the Three Months Ended June 30, 2022 Mortgage revenue bond advances 3 $ 20,307 N/A N/A 6 Mortgage revenue bond redemption 1 7,100 $ 7,100 N/A 6 Governmental issuer loan advances 5 39,806 N/A N/A 7 Investments in unconsolidated entities 4 7,824 N/A N/A 9 Return of investment in unconsolidated entity upon sale 1 7,341 N/A N/A 9 Property loan advances 7 23,527 N/A N/A 10 Taxable mortgage revenue bond advances 2 2,000 N/A N/A 12 For the Three Months Ended March 31, 2022 Mortgage revenue bond advances 3 $ 69,365 N/A N/A 6 Mortgage revenue bond redemptions 4 70,479 $ 45,109 N/A 6 Governmental issuer loan advances 6 16,882 N/A N/A 7 Investments in unconsolidated entities 5 12,777 N/A N/A 9 Return of investment in unconsolidated entity upon sale 1 12,240 N/A $ 3,242 9 Property loan advances 5 38,412 N/A N/A 10 Property loan redemptions and principal paydowns 7 3,251 N/A N/A 10 Taxable mortgage revenue bond advances 2 6,325 N/A N/A 12 For the Three Months Ended December 31, 2021 Mortgage revenue bond advances 5 $ 56,726 N/A N/A 6 Mortgage revenue bond redemption 1 4,065 $ 3,553 N/A 6 Governmental issuer loan advances 6 18,781 N/A N/A 7 Investments in unconsolidated entities 5 17,548 N/A N/A 9 Property loan advances 6 36,537 N/A N/A 10 Taxable mortgage revenue bond advance 1 1,000 N/A N/A 12 For the Three Months Ended September 30, 2021 Mortgage revenue bond advances 2 $ 3,995 N/A N/A 6 Mortgage revenue bond redemptions 4 32,380 $ 25,690 $ 462 6 Governmental issuer loan advances 6 35,582 N/A N/A 7 Investments in unconsolidated entities 3 6,112 N/A N/A 9 Return of investment in unconsolidated entity upon sale 1 8,600 N/A 73 9 Property loan advances 4 14,420 N/A N/A 10 Taxable mortgage revenue bond advance 1 1,000 N/A N/A 12 For the Three Months Ended June 30, 2021 Mortgage revenue bond advances 2 $ 6,880 N/A N/A 6 Governmental issuer loan advances 5 26,474 N/A N/A 7 Land acquisition for future development 1 1,054 N/A N/A 8 Investments in unconsolidated entities 2 11,641 N/A N/A 9 Return of investment in unconsolidated entity upon sale 1 10,736 N/A $ 1,366 9 Property loan advances 2 1,859 N/A N/A 10 For the Three Months Ended March 31, 2021 Mortgage revenue bond advance 1 $ 2,072 N/A N/A 6 Mortgage revenue bond redemptions 2 7,385 N/A N/A 6 Governmental issuer loan advances 6 39,068 N/A N/A 7 Investment in unconsolidated entity 1 1,426 N/A N/A 9 Return of investment in unconsolidated entity upon sale 1 10,425 N/A $ 702 9 Property loan advances 3 3,000 N/A N/A 10 Taxable governmental issuer loan advance 1 1,000 N/A N/A 12 (1) See “Cash Available for Distribution” in Item 7 of this Report. 13 Recent Financing Activities The following table presents information regarding the debt financing, derivatives, Preferred Units and partners’ capital activities of the Partnership for the years ended December 31, 2022 and 2021, exclusive of retired debt amounts listed in the investment activities table above: Financing, Derivative and Capital Activity # Amount (in 000`s) Secured Notes to the Partnership`s consolidated financial statements For the Three Months Ended December 31, 2022 Net borrowing on Acquisition LOC 6 $ 24,558 Yes 14 Proceeds from TOB trust financings with Mizuho 8 70,387 Yes 15 Proceeds from TOB trust financing with Barclays 4 27,285 Yes 15 Interest rate swaps purchased 3 - N/A 17 Exchange of Series A Preferred Units for Series A-1 Preferred Units 1 10,000 N/A 19 For the Three Months Ended September 30, 2022 Net repayment on Acquisition LOC 4 $ 8,512 Yes 14 Proceeds from TOB trust financings with Mizuho 4 24,930 Yes 15 Proceeds from TOB trust financing with Barclays 1 20,215 Yes 15 For the Three Months Ended June 30, 2022 Net borrowing on Acquisition LOC 5 $ 9,255 Yes 14 Proceeds from TOB trust financings with Mizuho 7 51,045 Yes 15 Proceeds from TOB trust financing with Barclays 1 11,875 Yes 15 Repayment of TOB Financings with Mizuho 2 5,079 Yes 15 Exchange of Series A Preferred Units for Series A-1 Preferred Units 1 20,000 N/A 19 For the Three Months Ended March 31, 2022 Net repayment on Acquisition LOC 1 $ 15,515 Yes 14 Proceeds from TOB trust financings with Mizuho 8 108,530 Yes 15 Proceeds from TOB trust financing with Barclays 1 800 Yes 15 Unrestricted cash from total return swap 1 41,275 Yes 17 Interest rate swaps purchased 2 - N/A 17 For the Three Months Ended December 31, 2021 Net borrowing on secured LOC 1 $ 39,214 Yes 14 Proceeds from TOB financings with Mizuho 6 61,419 Yes 15 Proceeds from TOB financing with Barclays 1 3,175 Yes 15 For the Three Months Ended September 30, 2021 Proceeds from TOB financings with Mizuho 7 $ 46,223 Yes 15 Proceeds on issuance of BUCs, net of issuance costs 1 31,243 N/A N/A For the Three Months Ended June 30, 2021 Net borrowing on secured LOC 1 $ 6,500 Yes 14 Proceeds from TOB financings with Mizuho 5 30,983 Yes 15 Termination of unsecured operating LOC 1 - No N/A For the Three Months Ended March 31, 2021 Net repayment on unsecured LOCs 5 $ 7,475 No N/A Proceeds from TOB trust financings with Mizuho 5 39,594 Yes 15 14 Regulatory Matters We conduct our operations in reliance on an exemption from registration as an investment company under the Investment Company Act of 1940, as amended (the “Investment Company Act”).
Biggest changeThese properties also compete by offering quality apartments in attractive locations and provide tenants with amenities such as recreational facilities, garages, services and pleasant landscaping. 12 Recent Developments Recent Investment Activities The following table presents information regarding the investment activities of the Partnership for the years ended December 31, 2023 and 2022: Investment Activity # Amount (in 000`s) Retired Debt (in 000`s) Tier 2 income (loss) allocable to the General Partner (in 000`s) (1) Notes to the Partnership`s consolidated financial statements For the Three Months Ended December 31, 2023 Mortgage revenue bond acquisition and advances 4 $ 21,575 N/A N/A 6 Mortgage revenue bond paydown 1 2,072 $ 1,765 N/A 6 Governmental issuer loan acquisition and advances 4 7,000 N/A N/A 7 Governmental issuer loan redemption 1 40,000 36,000 N/A 7 Property loan acquisitions and advances 5 18,252 N/A N/A 8 Property loan redemption 1 13,387 12,030 N/A 8 Investments in unconsolidated entities 6 16,104 N/A N/A 9 MF property sold 1 40,736 25,000 - 10 Taxable mortgage revenue bond advance 1 3,000 N/A N/A 12 For the Three Months Ended September 30, 2023 Mortgage revenue bond advances 3 $ 7,665 N/A N/A 6 Mortgage revenue bond paydown 1 7,590 $ 9,980 N/A 6 Governmental issuer loan acquisition and advances 5 22,573 N/A N/A 7 Governmental issuer loan redemptions 3 70,636 61,459 N/A 7 Property loan advances 2 11,950 N/A N/A 8 Property loan redemption and paydowns 3 39,921 35,655 N/A 8 Investments in unconsolidated entities 4 10,194 N/A N/A 9 Taxable mortgage revenue bond advance 1 4,000 N/A N/A 12 Taxable mortgage revenue bond redemption 1 7,000 5,770 N/A 12 For the Three Months Ended June 30, 2023 Mortgage revenue bond acquisitions and advance 6 $ 51,150 N/A N/A 6 Governmental issuer loan advances 4 20,402 N/A N/A 7 Governmental issuer loan redemption 1 34,000 $ 30,600 N/A 7 Property loan advances 3 9,608 N/A N/A 8 Property loan redemption and paydowns 3 29,990 26,005 N/A 8 Investments in unconsolidated entities 2 3,744 N/A N/A 9 Return of investment in unconsolidated entities upon sale 1 9,025 N/A $ 813 9 Taxable mortgage revenue bond acquisitions and advance 3 4,500 N/A N/A 12 Taxable governmental issuer loan advance 1 2,573 N/A N/A 12 For the Three Months Ended March 31, 2023 Mortgage revenue bond advances 6 $ 60,547 N/A N/A 6 Mortgage revenue bond redemptions 3 11,856 $ 7,579 $ (1,428 ) 6 Governmental issuer loan advances 4 17,377 N/A N/A 7 Property loan advances 4 7,581 N/A N/A 8 Property loan redemption and paydowns 3 18,316 15,700 N/A 8 Investments in unconsolidated entities 2 5,698 N/A N/A 9 Return of investment in unconsolidated entities upon sale 2 12,283 N/A 3,843 9 Taxable mortgage revenue bond advances 2 1,805 N/A N/A 12 Taxable governmental issuer loan advance 1 3,000 N/A N/A 12 For the Three Months Ended December 31, 2022 Mortgage revenue bond advances 8 $ 91,040 N/A N/A 6 Mortgage revenue bond redemptions 2 6,029 N/A N/A 6 Governmental issuer loan advances 6 18,955 N/A N/A 7 Property loan advances 4 46,439 N/A N/A 8 Investments in unconsolidated entities 2 10,912 N/A N/A 9 MF property sold 1 29,033 $ 24,229 N/A 10 Taxable mortgage revenue bond advances 3 2,980 N/A N/A 12 Taxable governmental issuer loan advance 1 4,000 N/A N/A 12 For the Three Months Ended September 30, 2022 Mortgage revenue bond advance 1 $ 1,623 N/A N/A 6 Mortgage revenue bond redemption and paydown 2 11,577 $ 10,420 N/A 6 Governmental issuer loan advances 7 39,820 N/A N/A 7 Property loan advances 6 22,742 N/A N/A 8 Property loan redemptions 3 27,081 N/A N/A 8 Investments in unconsolidated entities 2 2,524 N/A N/A 9 Return of investment in unconsolidated entity upon sale 1 7,400 N/A N/A 9 Taxable mortgage revenue bond advance 1 2,300 N/A N/A 12 Taxable governmental issuer loan advances 3 3,000 N/A N/A 12 For the Three Months Ended June 30, 2022 Mortgage revenue bond advances 3 $ 20,307 N/A N/A 6 Mortgage revenue bond redemption 1 7,100 $ 7,100 N/A 6 Governmental issuer loan advances 5 39,806 N/A N/A 7 Property loan advances 7 23,527 N/A N/A 8 Investments in unconsolidated entities 4 7,824 N/A N/A 9 Return of investment in unconsolidated entity upon sale 1 7,341 N/A N/A 9 Taxable mortgage revenue bond advances 2 2,000 N/A N/A 12 For the Three Months Ended March 31, 2022 Mortgage revenue bond advances 3 $ 69,365 N/A N/A 6 Mortgage revenue bond redemptions 4 70,479 $ 45,109 N/A 6 Governmental issuer loan advances 6 16,882 N/A N/A 7 Property loan advances 5 38,412 N/A N/A 8 Property loan redemptions and principal paydowns 7 3,251 N/A N/A 8 Investments in unconsolidated entities 5 12,777 N/A N/A 9 Return of investment in unconsolidated entity upon sale 1 12,240 N/A $ 3,242 9 Taxable mortgage revenue bond advances 2 6,325 N/A N/A 12 13 (1) See “Cash Available for Distribution” in Item 7 of this Report.
Our BUCs are traded on the New York Stock Exchange ("NYSE") under the symbol “GHI.” The Partnership has designated three series of non-cumulative, non-voting, non-convertible preferred units (collectively, the “Preferred Units”) that represent limited partnership interests in the Partnership consisting of the Series A Preferred Units, the Series A-1 Preferred Units, and the Series B Preferred Units.
Our BUCs are traded on the New York Stock Exchange ("NYSE") under the symbol “GHI.” The Partnership has designated three series of non-cumulative, non-voting, non-convertible preferred units that represent limited partnership interests in the Partnership consisting of the Series A Preferred Units, the Series A-1 Preferred Units, and the Series B Preferred Units (collectively, the “Preferred Units”).
Each of the TEBS financings are non-recourse to the Partnership such that our shortfall funding for each TEBS financing is limited to the stated amount of our residual interests. The TOB trust and term TOB trust financings are recourse obligations of the Partnership.
The TEBS financings and TEBS Residual Financing are non-recourse to the Partnership such that our shortfall funding for each financing is limited to the stated amount of our residual interests. The TOB trust and term TOB trust financings are recourse obligations of the Partnership.
The Plan is also intended to attract and retain the services of individuals who are essential for the Partnership’s growth and profitability and to encourage those individuals to devote their 15 best efforts to advancing the Partnership’s business. Greystone also supports employees with an annual confidential employee survey, Employee Assistance Program and ethics hotline.
The Plan is also intended to attract and retain the services of individuals who are essential for the Partnership’s growth and profitability and to encourage those individuals to devote their 15 best efforts to advancing the Partnership’s business. Greystone also supports employees with an annual confidential employee survey, an Employee Assistance Program and ethics hotline.
Business Objectives and Strategy Investment Strategy Our primary business objective is to manage our portfolio of investment to achieve the following: • Generate attractive, risk-adjusted total returns for our Unitholders; • Create streams of recurring income to support regular cash distributions to Unitholders; • Pass through tax-advantaged income to Unitholders; • Generate income from capital gains on asset dispositions; • Use leverage effectively to increase returns on our investments; and • Preserve and protect Partnership assets.
Business Objectives and Strategy Investment Strategy Our primary business objective is to manage our portfolio of investments to achieve the following: • Generate attractive, risk-adjusted total returns for our Unitholders; • Create streams of recurring income to support regular distributions to Unitholders; • Pass through tax-advantaged income to Unitholders; • Generate income from capital gains on asset dispositions; • Use leverage effectively to increase returns on our investments; and • Preserve and protect Partnership assets.
We filed a registration statement on Form S-4 to register the offering and issuance of up to 9,450,000 of Series A-1 Preferred Units under a shelf registration process that was declared effective by the SEC on July 6, 2021, and subsequently amended pursuant to a Post-Effective Amendment to the Form S-4, which was declared effective by the Commission on April 13, 2022.
We previously filed a registration statement on Form S-4 to register the offering and issuance of up to 9,450,000 of Series A-1 Preferred Units under a shelf registration process that was declared effective by the SEC on July 6, 2021, and subsequently amended pursuant to a Post-Effective Amendment to the Form S-4, which was declared effective by the Commission on April 13, 2022.
We primarily invest in MRBs that are senior obligations of the secured properties, though we may also invest in subordinate MRBs. Our MRBs predominantly bear interest at fixed interest rates and require regular principal and interest payments on either a monthly or semi-annual basis. The majority of our MRBs have initial contractual terms of 15 years or more.
We primarily invest in MRBs that are senior obligations of the secured properties, though we may also invest in subordinate and/or taxable MRBs. Our MRBs predominantly bear interest at fixed interest rates and require regular principal and interest payments on either a monthly or semi-annual basis. The majority of our MRBs have initial contractual terms of 15 years or more.
The borrowers associated with our MRBs are either syndicated partnerships formed to receive allocations of LIHTCs or not-for-profit entities. We do not directly or indirectly invest in LIHTCs but invest in MRBs that are issued in association with federal LIHTC allocations because such MRBs bear interest that we expect and believe is exempt from federal income taxes.
The borrowers associated with our MRBs are either syndicated partnerships formed to receive allocations of LIHTCs or not-for-profit entities. We do not directly or indirectly invest in LIHTCs. We do invest in MRBs that are issued in association with federal LIHTC allocations because such MRBs bear interest that we expect and believe is exempt from federal income taxes.
Sources of the funds to pay principal and interest on a GIL consist of the net cash flow of the secured property, proceeds from the sale or refinancing of the secured property, and limited-to-full payment guaranties provided by affiliates of the borrower. We typically commit to fund our GIL investment commitments on a draw-down basis during construction.
Sources of the funds to pay principal and interest on a GIL consist of the net cash flow of the secured property, proceeds from the sale or refinancing of the secured property, and limited-to-full payment guaranties provided by the borrower or its affiliates. We typically commit to fund our GIL investment commitments on a draw-down basis during construction.
We plan to continue investing in additional MRBs and GILs issued to finance affordable multifamily and seniors residential rental housing properties. 9 We continue to evaluate opportunities for MRB investments to fund seniors housing properties and/or skilled nursing properties issued as private activity or 501(c)(3) bonds similar in legal structure to those issued for traditional affordable multifamily housing properties.
We plan to continue investing in additional MRBs and GILs issued to finance affordable multifamily and seniors residential rental housing properties. We continue to evaluate opportunities for MRB investments to fund seniors housing properties and/or skilled nursing properties issued as private activity or 501(c)(3) bonds similar in legal structure to those issued for traditional affordable multifamily housing properties.
Otherwise, the secured investment asset will be sold and we will be required to fund any shortfall in funds available to pay the principal amount of the senior securities after payment of accrued interest and other trust expenses. If we do not fund the shortfall, default and liquidation provisions will be invoked against us.
Otherwise, the secured investment asset(s) will be sold and we will be required to fund any shortfall in funds available to pay the principal amount of the senior securities after payment of accrued interest and other trust expenses. If we do not fund the shortfall, default and liquidation provisions will be invoked against us.
Each GIL is secured by a mortgage on all real and personal property of the to-be-constructed affordable multifamily property. The GILs may share first mortgage lien positions with property loans and/or taxable GILs also owned by us.
Each GIL is secured by a mortgage on all real and personal property of the to-be-constructed affordable multifamily property. The GILs may share first mortgage lien positions with property loans and/or taxable GILs 7 also owned by us.
The Partnership believes there continues to be a significant unmet demand for affordable multifamily and seniors residential housing in the United States. Government programs that provide direct rental support to residents have not kept up with demand.
The Partnership believes there continues to be significant unmet demand for affordable multifamily and seniors residential housing in the United States. Government programs that provide direct rental support to residents have not kept up with demand.
A GIL does not constitute an obligation of any government, agency or authority and 7 no government, agency or authority is liable for them, nor is the taxing power of any government pledged to the payment of principal or interest on the GIL.
A GIL does not constitute an obligation of any government, agency or authority and no government, agency or authority is liable for them, nor is the taxing power of any government pledged to the payment of principal or interest on the GIL.
The Series A Preferred Units are subject to optional redemption by the holder upon the sixth anniversary of the closing of the sale of Series A Preferred Units and the holders are entitled to distributions at a fixed rate of 3.0% per annum.
The Series A Preferred Units are subject to optional redemption by the holder upon the sixth anniversary of the closing of the 11 sale of Series A Preferred Units and the holders are entitled to distributions at a fixed rate of 3.0% per annum.
In July 2021, we entered into a Capital on Demand TM Sales Agreement to offer and sell, from time to time at market prices on the date of sale, BUCs up to an aggregate offering price of $30 million via an “at the market offering.” As of December 31, 2022, we have not sold any BUCs under this program.
In July 2021, we entered into a Capital on Demand TM Sales Agreement to offer and sell, from time to time at market prices on the date of sale, BUCs up to an aggregate offering price of $30 million via an “at the market offering.” As of December 31, 2023, we have not sold any BUCs under this program.
The distributive share of income, deductions and credits is reported to our Unitholders on Internal Revenue Service (“IRS”) Schedule K-1 and Unitholders should include such amount in their respective federal and state income tax returns. We hold certain property loans through a wholly owned subsidiary that is a “C” corporation for income tax purposes.
The distributive share of income, deductions and credits is reported to our Unitholders on Internal Revenue Service (“IRS”) Schedule K-1 and Unitholders should include such amount in their respective federal and state income tax returns. We hold certain property loans and real estate through a wholly owned subsidiary that is a “C” corporation for income tax purposes.
JV Equity Investments We invest in non-controlling membership interests in unconsolidated entities for the construction of market-rate multifamily real estate properties. Our JV Equity Investments are passive in nature. Operational oversight of each property is controlled by our joint venture partner according to the entity’s operating agreement.
JV Equity Investments We invest in non-controlling membership interests in unconsolidated entities for the construction of market-rate multifamily and seniors real estate properties. Our JV Equity Investments are passive in nature. Operational oversight of each property is controlled by our joint venture partner according to the entity’s operating agreement.
Of the 14 employees of Greystone Manager responsible for the Partnership’s operations, three are women and one employee identifies as ethnically diverse. Greystone Manager is responsible for filling open positions as it relates to the Partnership and considers both internal and external candidates. Greystone Manager may contract with third party search firms to identify candidates for open positions as needed.
Of the 16 employees of Greystone Manager responsible for the Partnership’s operations, three are women and one employee identifies as ethnically diverse. Greystone Manager is responsible for filling open positions as it relates to the Partnership and considers both internal and external candidates. Greystone Manager may contract with third party search firms to identify candidates for open positions as needed.
Our ownership of the membership interests entitles us to shares of certain cash flows generated by the JV Equity Investments from operations and upon the occurrence of certain capital transactions, such as a refinancing or sale. Upon the sale of a property, net proceeds will be distributed according to the entity operating agreement.
Our ownership of the membership interests entitles us to shares of certain cash flows generated by the JV Equity Investments from operations and upon the occurrence of certain capital transactions, such as a refinancing or sale. Upon the sale of a property, net proceeds will be distributed according to the entity's operating agreement.
We will continue to assess if and when to issue BUCs under this program going forward. Reportable Segments As of December 31, 2022, we had four reportable segments: (1) Affordable Multifamily MRB Investments, (2) Seniors and Skilled Nursing MRB Investments, (3) Market-Rate Joint Venture Investments, and (4) MF Properties.
We will continue to assess if and when to issue BUCs under this program going forward. Reportable Segments As of December 31, 2023, we had four reportable segments: (1) Affordable Multifamily MRB Investments, (2) Seniors and Skilled Nursing MRB Investments, (3) Market-Rate Joint Venture Investments, and (4) MF Properties.
Similarly, we attempt to obtain variable-rate debt financing for our variable-rate investment assets such that we are largely hedged against rising interest rates without the need for separate hedging instruments. We leverage certain fixed-rate investment assets with variable-rate debt financings, such as the TOB trusts, Secured Notes and one TEBS financing.
Similarly, we attempt to obtain variable-rate debt financing for our variable-rate investment assets such that we are largely hedged against rising interest rates without the need for separate hedging instruments. We leverage certain fixed-rate investment assets with variable-rate debt financings, such as the TOB trusts and one TEBS financing.
State and local housing authorities may require additional tenant income or rent restrictions that are more restrictive than those required by Treasury Regulations. There are no Treasury Regulations related to MRBs that are secured by a commercial property owned by a non-profit borrower.
State and local housing authorities may require additional tenant income or rent restrictions that are more restrictive than those minimum levels required by Treasury Regulations. There are no Treasury Regulations related to MRBs that are secured by a commercial property owned by a non-profit borrower.
All properties are managed by a property management company affiliated with our joint venture partner. Decisions on when to sell an individual property are made by our joint venture partner based on its view of the local market conditions and current leasing trends.
The properties are predominately managed by a property management company affiliated with our joint venture partner. Decisions on when to sell an individual property are made by our joint venture partner based on its view of the local market conditions and current leasing trends.
Greystone provides formal and informal training programs to enhance the skills of employees providing services to the Partnership and to instill Greystone’s corporate policies and practices. The Partnership also reimburses the cost of formal training for those programs that are directly related to the tasks and responsibilities of the employees related to operations of the Partnership.
Greystone provides formal and informal training programs to enhance the skills of employees providing services to the Partnership and to instill Greystone’s corporate policies and practices. The Partnership also reimburses the cost of formal training for those programs that are directly related to the tasks and responsibilities of the employees who perform the operations of the Partnership.
Governmental Issuer Loans (“GILs”) We invest in governmental issuer loans ("GILs") that are issued by state or local governmental authorities to finance the construction of affordable multifamily properties.
Governmental Issuer Loans (“GILs”) We invest in governmental issuer loans ("GILs") that are issued by state or local governmental authorities to finance the construction and/or rehabilitation of affordable multifamily properties.
We may acquire additional Tax Exempt Investments and Other Investments provided that the acquisition may not cause the aggregate book value of all Tax Exempt Investments plus Other Investments to exceed 25% of our total assets at the time of acquisition. We currently own no Tax Exempt Investments as of December 31, 2022.
We may acquire additional Tax Exempt Investments and Other Investments provided that the acquisition may not cause the aggregate book value of all Tax Exempt Investments plus Other Investments to exceed 25% of our total assets at the time of acquisition. We own no Tax Exempt Investments as of December 31, 2023.
The proceeds received from these transactions would be redeployed into other investments consistent with our investment objectives. We anticipate holding our GILs until maturity as the terms are typically for two to four years and have defined forward purchase commitments from Freddie Mac, acting through a servicer.
The proceeds received from these transactions would be redeployed into other investments consistent with our investment objectives. We anticipate holding our GILs until maturity as the terms are typically for two to four years and have defined forward purchase commitments from Freddie Mac.
These competitors often have greater access to capital and can originate investments with interest rates and terms that do not meet our return requirements. This competition may reduce the availability of investments for acquisition and may reduce the interest rate that issuers are willing to pay on our future investments.
These competitors often have greater access to capital and can acquire investments with interest rates and terms that do not meet our return requirements. This competition may reduce the availability of investments for acquisition by us and may reduce the interest rate that issuers are willing to pay on our future investments.
We also invest in governmental issuer loans (“GILs”), which are similar to MRBs, to provide construction financing for affordable multifamily properties. We expect and believe the interest received on our MRBs and GILs is excludable from gross income for federal income tax purposes.
The Partnership has also invested in governmental issuer loans (“GILs”), which are similar to MRBs, to provide construction financing for affordable multifamily properties. We expect and believe the interest received on our MRBs and GILs is excludable from gross income for federal income tax purposes.
We calculate our Leverage Ratio as total outstanding debt divided by total assets using cost (adjusted for paydowns) for MRBs, GILs, property loans, taxable MRBs and taxable GILs, and initial cost for deferred financing costs and real estate assets. As of December 31, 2022, our overall Leverage Ratio was approximately 73%.
We calculate our Leverage Ratio as total outstanding debt divided by total assets using cost (adjusted for paydowns) for MRBs, GILs, property loans, taxable MRBs and taxable GILs, and initial cost for deferred financing costs and real estate assets. As of December 31, 2023, our overall Leverage Ratio was approximately 72%.
Upon stabilization, the servicer will purchase our GIL at par and then immediately sell the GIL to Freddie Mac pursuant to a financing commitment between the servicer and Freddie Mac. As of December 31, 2022, the servicer for eleven of our GILs is an affiliate of Greystone.
Upon stabilization, the servicer will purchase our GIL at par and then immediately sell the GIL to Freddie Mac pursuant to a financing commitment between the servicer and Freddie Mac. As of December 31, 2023, the servicer for eight of our GILs is an affiliate of Greystone.
Human Capital Resources As of December 31, 2022, the Partnership had no employees. Fourteen employees of Greystone Manager are responsible for the Partnership’s operations, inclusive of the Partnership’s chief executive officer and chief financial officer. Such employees are subject to the policies and compensation practices of Greystone.
Human Capital Resources As of December 31, 2023, the Partnership had no employees. Sixteen employees of Greystone Manager are responsible for the Partnership’s operations, inclusive of the Partnership’s chief executive officer and chief financial officer. Such employees are subject to the policies and compensation practices of Greystone.
AFCA 2 may also earn mortgage and investment placement fees resulting from the identification and evaluation of additional investments that are acquired by the Partnership. Any fees related to the origination of our investment assets are paid by the property owner. The fees, if any, will be subject to negotiation between AFCA 2 and such property owners.
AFCA 2 also earns mortgage and investment placement fees resulting from the identification and evaluation of additional investments that are acquired by the Partnership. Any fees related to the acquisition of our investment assets are paid by the property owner. The fees, if any, will be subject to negotiation between AFCA 2 and such property owners.
In addition, we filed a registration statement on Form S-3 for the registration of up to 10,000,000 of Series B Preferred Units, which was declared effective by the SEC on September 9, 2021, and subsequently amended pursuant to a Post-Effective Amendment to the Form S-3, which was declared effective by the Commission on April 13, 2022.
In addition, we filed a registration statement on Form S-3 for the registration of up to 10,000,000 of Series B Preferred Units, which was declared effective by the SEC on September 9, 2021, and subsequently amended pursuant to a Post-Effective Amendment to the Form S-3, which was declared effective by the Commission on June 15, 2023.
Those constraints are dependent upon several factors, including the investment assets being leveraged, the tenor of the leverage program, whether the financing is subject to mark-to-market based collateral calls, and the liquidity and marketability of the financed assets.
Those constraints are dependent upon several factors, including the characteristics of the investment assets being leveraged, the tenor of the leverage program, whether the financing is subject to mark-to-market collateral posting requirements, and the liquidity and marketability of the financed assets.
The Mizuho and 10 Barclays ISDA master agreements also require the Partnership’s partners’ capital, as defined, to maintain a certain threshold and that the BUCs remain listed on a national securities exchange. The ISDA master agreement with Barclays also puts limits on the Partnership’s Leverage Ratio (as defined by the Partnership below).
The Mizuho and Barclays ISDA master agreements contain covenants that require the Partnership’s partners’ capital, as defined, to maintain a certain threshold and that the BUCs remain listed on a national securities exchange. The ISDA master agreement with Barclays also requires that the Partnership’s Leverage Ratio (as defined by the Partnership below) remain below a certain threshold.
The Series B Preferred Units are subject to optional redemption by the holder upon the eighth anniversary of the closing of the sale of Series B Preferred Units and the holders are entitled to distributions at a fixed rate of 3.4% per annum.
The Series B Preferred Units are subject to optional redemption by the holder upon the sixth anniversary of the closing of the sale of Series B Preferred Units and the holders are entitled to distributions at a fixed rate of 5.75% per annum.
We also make noncontrolling equity investments in unconsolidated entities for the construction, stabilization, and ultimate sale of market-rate multifamily properties (“JV Equity Investments”). We are entitled to distributions if, and when, cash is available for distribution either through normal operations, a refinance, or a sale of the property.
The Partnership also makes noncontrolling equity investments in unconsolidated entities for the construction, stabilization, and ultimate sale of market-rate multifamily properties ("JV Equity Investments"). The Partnership is entitled to distributions if, and when, cash is available for distribution either through operations, a refinance, or a sale of the property.
We generally structure our debt financings such that principal, interest, and any trust expenses are payable from the cash flows of the secured investment assets, and we are generally entitled to all residual cash flows for our general use.
We retain the residual interests which entitle us to certain rights to the investment assets and to residual cash proceeds. We generally structure our debt financings such that principal, interest, and any trust expenses are payable from the cash flows of the secured investment assets, and we are generally entitled to all residual cash flows for our general use.
As a result, we may experience significant income recognition in those quarters when a property is sold and our equity investment is redeemed. As of December 31, 2022, we owned membership interests in 11 unconsolidated entities located in three states in the United States. Seven of the 11 JV Equity Investments are located in Texas.
As a result, we may experience significant income recognition for these investments in those quarters when a property is sold and our equity investment is redeemed. As of December 31, 2023, we owned membership interests in 12 unconsolidated entities located in four states in the United States. Eight of the 12 JV Equity Investments are located in Texas.
Investment Types Mortgage Revenue Bonds (“MRBs”) We invest in MRBs that are issued by state and local governments, their agencies, and authorities to finance the construction or acquisition and rehabilitation of income-producing multifamily rental properties.
See Item 1A, “Risk Factors” in this Report for additional details. Investment Types Mortgage Revenue Bonds (“MRBs”) We invest in MRBs that are issued by state and local governments, their agencies, and authorities to finance the construction or acquisition and rehabilitation of income-producing multifamily rental properties.
We may utilize other types of secured or unsecured borrowings in the future, including more complex financing structures and diversification of our leverage sources and counterparties. We refer to our TEBS, TOB trust, and term TOB trust securitizations and our Secured Notes as our debt financings.
We may utilize other types of secured or unsecured borrowings in the future, including more complex financing structures and diversification of our leverage sources and counterparties. We refer to our TEBS, TOB trust, term TOB trust, and TEBS Residual Financing securitizations as our debt financings. These debt financing securitizations are accounted for as consolidated VIEs for reporting purposes.
As of December 31, 2022, we have not issued any Series A-1 Preferred Units under the registration statement on Form S-3.
As of December 31, 2023, we have issued $18 million of Series A-1 Preferred Units under the registration statement on Form S-3.
The Board of Managers of Greystone Manager establishes an overall maximum leverage level (the “Leverage Ratio”) and retains the right to change the Leverage Ratio in the future based on the consideration of factors the Board of Managers considers relevant. In February 2023, the Board of Managers approved an increase in the maximum leverage ratio from 75% to 80%.
The Board of Managers of Greystone Manager has established an overall maximum leverage level (the “Leverage Ratio”) of 80% and retains the right to change the Leverage Ratio in the future based on the consideration of factors the Board of Managers considers relevant.
We currently obtain leverage on our investments and assets through various sources that include: • Our secured line of credit facilities with BankUnited, N.A. and Bankers Trust Company; • Tax-Exempt Bond Securitization (“TEBS”) programs with Freddie Mac; • Tender Option Bond (“TOB”) trust securitizations with Mizuho Capital Markets (“Mizuho”) and Barclays Bank PLC (“Barclays”); • Term TOB trust securitizations with Morgan Stanley; and • Secured notes (“Secured Notes”) issued to Mizuho.
We currently obtain leverage on our investments and assets through various sources that include: • Our secured line of credit facilities; • Tax-Exempt Bond Securitization (“TEBS”) programs with Freddie Mac; • Tender Option Bond (“TOB”) and term TOB trust securitizations with Mizuho Capital Markets (“Mizuho”), Barclays Bank PLC (“Barclays”), and Morgan Stanley; and • A TEBS residual securitization (the “TEBS Residual Financing”) through a governmental issuer.
Our Other Investments primarily consist of MF Properties, other real estate assets, JV Equity Investments and certain property loans as of December 31, 2022. We rely on an exemption from registration under the Investment Company Act of 1940, which has certain restrictions on the types and amounts of securities owned by the Partnership.
Our Other Investments primarily consist of real estate assets, JV Equity Investments and certain property loans. We rely on an exemption from registration under the Investment Company Act of 1940, which has certain restrictions on the types and amounts of securities owned by the Partnership. See the “Regulatory Matters” section included within this Item 1 below for further information.
Interest earned on our taxable MRBs is taxable for federal income tax purposes. Our taxable MRBs may share senior mortgage interest in the property with the MRBs or may be subordinate to the MRBs.
Interest earned on our taxable MRBs is taxable for federal income tax purposes. Our taxable MRBs may share senior mortgage interest in the property with the MRBs or may be subordinate to the MRBs. We owned 14 taxable MRBs with outstanding principal of $23.2 million as of December 31, 2023.
The TEBS, TOB trust and term TOB trust securitizations are accounted for as consolidated VIEs for reporting purposes. These arrangements are structured such that we transfer our investment assets to an entity, such as a trust or special purpose entity, which then issues senior securities and residual interests.
These arrangements are structured such that we transfer our investment assets to an entity, such as a trust or special purpose entity, which then issues senior securities and residual interests. The senior securities are sold to third-party investors in exchange for debt proceeds.
There can be no assurance that we will be able to finance additional acquisitions of MRBs, GILs and other investments through additional debt financings. We set target constraints for each type of debt financing utilized.
An inability to access debt financing at an acceptable cost may result in adverse effects on our financial condition and results of operations. There can be no assurance that we will be able to finance additional acquisitions of MRBs, GILs and other investments through additional debt financing. We set target constraints for each type of debt financing utilized.
The following table summarizes the amount of our MRB investments with LIHTC-associated borrowers and non-profit borrowers based on principal outstanding as of December 31, 2022: Borrower Type MRB Principal Outstanding Percentage of all MRB Investments LIHTC-associated borrowers $ 395,563,043 51 % Non-profit borrowers 370,727,772 48 % Non-LIHTC private activity bonds 4,723,437 1 % Totals $ 771,014,252 100 % We may also invest in taxable MRBs secured by the same properties as our MRBs.
The following table summarizes the amount of our MRB investments with LIHTC-associated borrowers and non-profit borrowers based on principal outstanding as of December 31, 2023: Borrower Type MRB Principal Outstanding Percentage of all MRB Investments LIHTC-associated borrowers $ 407,928,063 46 % Non-profit borrowers 439,631,263 50 % Non-LIHTC private activity bonds 37,105,000 4 % Totals $ 884,664,326 100 % We may also invest in taxable MRBs secured by the same properties as our MRBs.
If unitholders elect to exchange Series A Preferred Units for Series A-1 Preferred Units, the new Series A-1 Preferred Units will not be eligible for redemption until the sixth anniversary of the date of the exchange, except in certain limited circumstances.
Under this offering, the Partnership may issue up to 1,750,000 Series B Preferred Units in exchange for our outstanding Series A Preferred Units. Series B Preferred Units issued in exchange for Series A Preferred Units will not be eligible for redemption until the sixth anniversary of the date of the exchange, except in certain limited circumstances.
We expect and believe the interest earned on our GILs is excludable from gross income for federal income tax purposes. The GILs are senior obligations of the secured properties and bear interest at variable interest rates. The GILs have initial terms of two to four years, though the borrower typically may prepay all amounts due at any time without penalty.
We expect and believe the interest earned on our GILs is excludable from gross income for federal income tax purposes. The GILs are senior obligations of the secured properties and bear interest at variable or fixed interest rates.
In addition, we may acquire and hold interests in multifamily, student and senior citizen residential properties (“MF Properties”) until the “highest and best use” can be determined by management. The conduct of the Partnership’s business and affairs is governed by the Partnership’s Second Amended and Restated Agreement of Limited Partnership dated December 5, 2022 (the “Partnership Agreement”).
In addition, the Partnership may acquire and hold interests in multifamily, student and senior citizen residential properties (“MF Properties”) until the “highest and best use” can be determined by management.
Our sole general partner is America First Capital Associates Limited Partnership Two (“AFCA 2” or the “General Partner”). The general partner of AFCA 2 is Greystone AF Manager LLC (“Greystone Manager”), which is an affiliate of Greystone & Co. II LLC (“Greystone & Co.”).
The general partner of AFCA 2 is Greystone AF Manager LLC (“Greystone Manager”), which is an affiliate of Greystone & Co. II LLC (“Greystone & Co.”).
We account for our JV Equity Investments using the equity method and recognize a preferred return on our contributed equity during the hold period.
We account for our JV Equity Investments using the equity method and recognize a preferred return on our contributed equity during the hold period. Our preferred returns are paid from distributable cash flow before any distributions are made to our joint venture partner.
The TOB trusts and Secured Notes with Mizuho and the TOB trust with Barclays are subject to ISDA master agreements with each counterparty that contain certain covenants and requirements. The TOB trust financings with Mizuho and Barclays require that the Partnership's residual interests in each TOB trust maintain a certain value in relation to total assets in each TOB trust.
The TOB trusts with Mizuho and Barclays are subject to ISDA master agreements with each counterparty that contain certain covenants and requirements.
At the closing of each GIL, Freddie Mac, through a servicer, has forward committed to purchase the GIL at maturity at par if and when the property has reached stabilization and other conditions are met.
The GILs have initial terms of two to four years, though the borrower typically may prepay all amounts due at any time without penalty. At the closing of each GIL, Freddie Mac, through a servicer, forward commits to purchase the GIL at maturity at par if and when the property has reached stabilization and other conditions are met.
As of December 31, 2022, we held interest rate swaps with notional amounts totaling $194.7 million and one interest rate cap with a notional amount of $75.0 million.
As of December 31, 2023, we had interest rate swap positions with notional amounts totaling $333.3 million and one interest rate cap with a notional amount of $73.4 million.
One MRB is secured by a mortgage on the ground, facilities, and equipment of a seniors housing property currently under construction in Michigan. Our MRBs are either owned directly by us or are held in trusts created in connection with debt financing transactions that are consolidated VIEs.
Our MRBs are either owned directly by us or are held in trusts created in connection with debt financing transactions that are consolidated VIEs.
In addition, both the Mizuho and Barclays ISDA master agreements specify that default(s) on the Partnership’s other senior debts above a specified dollar amount, in the aggregate, will constitute a default under such agreement. If the Partnership is not in compliance with any of these covenants, a termination event of the financing facilities would be triggered.
In addition, both the Mizuho and Barclays ISDA master agreements have cross-default previsions whereby default(s) on the Partnership’s 10 other senior debts above a specified dollar amount, in the aggregate, will constitute a default under the ISDA master agreements.
The willingness of leverage providers to extend financing is dependent on various factors such as their underwriting standards, regulatory requirements, available lending capacity, and existing credit exposure to the Partnership. An inability to access debt financing at an acceptable cost may result in adverse effects on our financial condition and results of operations.
If the Partnership is not in compliance with any of these covenants, a termination event of the financing facilities would be triggered. The willingness of leverage providers to extend financing is dependent on various factors such as their underwriting standards, regulatory requirements, available lending capacity, and existing credit exposure to the Partnership.
We have not yet issued any Series B Preferred Units as of December 31, 2022. 11 We have previously issued Series A Preferred Units totaling $94.5 million.
As of the date of this report, we had 2,250,000 Series B Preferred Units issued and outstanding. We have previously issued Series A Preferred Units totaling $94.5 million, of which $27.5 million are outstanding as of December 31, 2023.
Our GILs have been issued under Section 142(d) of the Internal Revenue Code (“IRC”) and are subject to the same set aside and tenant income restrictions noted in the “Mortgage Revenue Bonds” description above. The borrowers associated with our GILs are syndicated partnerships formed to receive allocations of LIHTCs.
The following table summarizes our GIL investments as of December 31, 2023: Total GILs Total Properties Total Units Total States Aggregate Outstanding Principal Outstanding Funding Commitments GIL investments 10 9 1,627 5 $ 222,947,300 $ 51,120,535 Our GILs have been issued under Section 142(d) of the Internal Revenue Code (“IRC”) and are subject to the same set aside and tenant income restrictions noted in the “Mortgage Revenue Bonds” description above.
We also continue to make additional strategic JV Equity Investments for the development of market-rate multifamily residential properties, through noncontrolling membership interests. We are also evaluating potential JV Equity Investments for the development of market-rate seniors housing properties. We believe such equity investments diversify our investment portfolio while also providing attractive risk-adjusted returns for our Unitholders.
We also continue to make additional strategic JV Equity Investments for the development of market-rate multifamily and seniors residential properties, through noncontrolling membership interests. We currently have investments with four joint venture partners, of which two were new in 2023.
During 2022, two Series A Preferred Unit holders elected to exchange 3,000,000 existing Series A Preferred Units for 3,000,000 newly issued Series A-1 Preferred Units. As of December 31, 2022, we had 6,450,000 Series A Preferred Units issued and outstanding.
During January 2024, one Series A Preferred Unit holder elected to exchange 1,750,000 existing Series A Preferred Units for 1,750,000 newly issued Series B Preferred Units.
Such GILs are secured by 13 affordable multifamily properties containing a total of 2,419 rental units located in six states in the United States. All our GILs are held in trusts created in connection with debt financing transactions that are consolidated VIEs.
Our GILs are held in trusts created in connection with debt financing transactions that are consolidated VIEs.
As of December 31, 2022, we owned one MF Property, the Suites on Paseo, containing a total of 384 rental units located in California. Property Loans We also invest in property loans to finance the construction, finance capital improvements, or otherwise support property operations of multifamily residential properties.
We owned four taxable GILs with outstanding principal of $13.6 million as of December 31, 2023. Property Loans We also invest in property loans to finance the construction, finance capital improvements, or otherwise support property operations of multifamily residential properties. Multifamily residential properties financed with property loans may or may not be properties securing our MRB and GIL investments.
Multifamily residential properties financed with property loans may or may not be properties securing our MRB and GIL investments. Such property loans may be secured by property, other collateral, or may be unsecured. General Investment Matters Our investments are categorized as either Mortgage Investments, Tax Exempt Investments or Other Investments as defined in our Partnership Agreement.
Such property loans may be secured by property, other collateral, or may be unsecured. As of December 31, 2023, we owned seven property loans related to our GIL investment properties, three property loans related to our MRB investments, and two property loans to other borrowers.
During 2021, we acquired our first senior citizen housing MRB, Meadow Valley, that will finance the construction and stabilization of a combined independent living, assisted living and memory care facility in Traverse City, MI. We continually assess opportunities to expand and/or reposition our existing portfolio of MRBs, GILs and other investments.
To date, we acquired an MRB secured by a to-be-constructed seniors housing property in Michigan, and an MRB secured by an operating skilled nursing facility in New Jersey. 9 We continually assess opportunities to expand and/or reposition our existing portfolio of MRBs, GILs and other investments.
MRBs may have optional call dates 6 that may be exercised by the borrower or us that are earlier than the contractual maturity. Such optional calls may be at either par or a premium to par. As of December 31, 2022, we reported 77 MRBs on our consolidated balance sheet with an aggregate outstanding principal amount of approximately $771.0 million.
Some MRBs have optional call dates that may be exercised by the borrower which may be at either par or a premium to par. Some MRBs have optional repurchase dates whereby we can require a redemption prior to the contractual maturity, typically at par.
Removed
There are currently no Series B Preferred Units issued and outstanding.
Added
The conduct of the Partnership’s business and affairs is governed by the Partnership’s Second Amended and Restated Agreement of Limited Partnership dated December 5, 2022, as further amended (the “Partnership Agreement”). Our sole general partner is America First Capital Associates Limited Partnership Two (“AFCA 2” or the “General Partner”).
Removed
See Item 1A, “Risk Factors” in this Report for additional details.
Added
The Partnership does not intend to issue additional Series A Preferred Units in the future.
Removed
On November 29, 2022, the Partnership filed an Amendment to the Certificate of Limited Partnership of the Partnership (the “Certificate Amendment”) with the Secretary of State of the State of Delaware to change the name of the Partnership from “America First Multifamily Investors, L.P.” to “Greystone Housing Impact Investors LP.” The name change became effective on December 5, 2022.
Added
The following table summarizes our MRB investments as of December 31, 2023: 6 Total MRBs Total Properties Total Units Total States Aggregate Outstanding Principal Outstanding Funding Commitments MRB investments 85 73 (1) 11,819 15 $ 884,664,326 $ 148,829,966 (1) Properties secured by our MRB investments consist of 71 multifamily properties, one seniors housing property, and one skilled nursing facility.
Removed
The Certificate Amendment and name change were approved by the Board of Managers of Greystone Manager and did not require the approval of the Partnership’s BUC holders.
Added
The borrowers associated with our GILs are syndicated partnerships formed to receive allocations of LIHTCs. We may also invest in taxable GILs secured by the same properties as our GILs. Interest earned on our taxable GILs is taxable for federal income tax purposes. Our taxable GILs share a senior mortgage interest in the property with the GILs.
Removed
The MRBs are secured by 66 multifamily residential properties containing a total of 10,976 rental units located in 13 states in the United States. One MRB is secured by a mortgage on the ground, facilities, and equipment of a commercial ancillary health care facility in Tennessee.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

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Biggest changeSummary Risk Factors These risks are discussed more fully below and include, but are not limited to, risks related to: Risks Related to our Business and Investments • We are managed by our general partner and engage in transactions with related parties. • Global economic, political and market conditions, including uncertainty about the financial stability of the United States, could have a significant adverse effect on our business, financial condition and results of operations. • We are subject to risks associated with the current interest rate environment, and changes in interest rates may affect our cost of capital and, consequently, our net income and CAD. • We are subject to risks related to inflation. • Our investment assets are generally illiquid and our valuation estimates are subject to inherent uncertainty. • The market value of our investment assets may be adversely impacted by increasing interest rates. • The receipt of contractual interest and principal payments on our MRBs, GILs and property loans will be affected by the economic results of the secured properties. • The rent restrictions and occupant income limitations imposed on properties securing our MRBs and GILs may limit the revenues of such properties. • There are risks related to the lease-up of newly constructed or renovated properties that may affect the MRBs, GILs and property loans secured by these properties. • The repayment of principal of our MRBs, GILs, and property loans is principally dependent upon proceeds from the sale or refinancing of the secured properties. • We are subject to various risks associated with our MRB and property loan investments secured by seniors housing and skilled nursing properties. • There are various risks associated with our JV Equity Investments. • There are risks related to the construction of properties underlying our investment assets. • Conditions in the low income housing tax credit markets due to known or potential changes in U.S. corporate tax rates may increase our cost of borrowing, make financing difficult to obtain or restrict our ability to invest in MRBs and other investments, each of which may have a material adverse effect on our results of operations and our business. • There are various risks associated with our commitments to fund investments on a draw-down or forward basis. • If we acquire ownership of properties securing our MRBs, GILs and/or property loans, we will be subject to all the risks normally associated with the ownership of such properties. • Properties related to our MRBs and JV Equity Investments are geographically concentrated in certain states. • Our investments in certain asset classes may be concentrated with certain developers and related affiliates. • Recourse guaranties related to our GILs and property loans are concentrated in certain entities. • There is risk that a third-party developer that has provided guaranties of preferred returns on our Vantage JV Equity Investments may not perform. • There are risks associated with the financial performance of our MF Property investment. • There are additional risks when we make property loans to properties securing our MRBs. • Our reserves for credit losses are based on estimates and may prove inadequate, which could have a material adverse effect on us. • Properties related to our investment assets may not be completely insured against damages from natural disasters. • The properties related to our investment assets may be subject to liability for environmental contamination which could increase the risk of default or loss on our investment. • We are subject to reinvestment risk from maturities and prepayments of our investment assets. • The effects of the outbreak and spread of a highly infectious or contagious disease may adversely affect our business activities, financial condition and results of operations.
Biggest changeSummary Risk Factors These risks are discussed more fully below and include, but are not limited to, risks related to: Risks Related to our Business and Investments • We are managed by our general partner and engage in transactions with related parties. • Global economic, political and market conditions, including uncertainty about the financial stability of the United States, could have a significant adverse effect on our business, financial condition and results of operations. • We are subject to risks associated with the current interest rate environment, and changes in interest rates may affect our cost of capital and, consequently, our net income and Cash Available for Distribution. • We are subject to risks related to inflation. • Our investment assets are generally illiquid and our valuation estimates are subject to inherent uncertainty. • The market value of our investment assets may be adversely impacted by increasing interest rates. • The receipt of contractual interest and principal payments on our debt investments will be affected by the economic results of the secured properties. • The rent restrictions and occupant income limitations imposed on properties securing our MRBs and GILs may limit the revenues of such properties. • There are risks related to the lease-up of newly constructed or renovated properties that may affect our debt investments secured by these properties. • The repayment of principal of our debt investments is principally dependent upon proceeds from the sale or refinancing of the secured properties. • We are subject to various risks associated with our debt investments secured by seniors housing and skilled nursing properties. • There are various risks associated with our JV Equity Investments including, but not limited to, risks normally associated with the ownership of such multifamily real estate, sales or refinancing, third-party property management, and variable interest costs. • There are risks related to the construction of properties underlying our investment assets. • Conditions in the low income housing tax credit markets due to known or potential changes in U.S. corporate tax rates may increase our cost of borrowing, make financing difficult to obtain or restrict our ability to invest in MRB and other investments, each of which may have a material adverse effect on our results of operations and our business. • There are various risks associated with our commitments to fund investments on a draw-down or forward basis. • If we acquire ownership of properties securing our investment assets through foreclosure or otherwise, we will be subject to all the risks normally associated with the ownership of such properties. • Properties related to our MRB investments and JV Equity Investments are geographically concentrated in certain states. • Our investments in certain asset classes may be concentrated with certain developers and related affiliates. • Recourse guaranties related to our GIL investments and property loans are concentrated in certain entities. • There is risk that a third-party developer that has provided guaranties of preferred returns on our Vantage JV Equity Investments may not perform. • Our reserves for credit losses are based on estimates and may prove inadequate, which could have a material adverse effect on our financial results. • Properties related to our investment assets may not be completely insured against damages from natural disasters. • The properties related to our investment assets may be subject to liability for environmental contamination which could increase the risk of default or loss on our investment. • We are subject to reinvestment risk from maturities and prepayments of our investment assets. • Adverse developments affecting the banking industry, such as actual events or concerns regarding bank failures, liquidity, defaults, or non-performance by financial institutions, could adversely affect our current and projected business operations and our financial condition and results of operations.
As the holder of residual interests in these trusts, we can look only to the cash flow of the trust remaining after payment of these senior obligations for payment on the residual interests. No third party guarantees the payment of any return to be received for our residual interests.
As the holder of residual interests in these trusts, we can look only to the cash flow of the trust remaining after payment of these senior obligations for payment on our residual interests. No third party guarantees the payment of any return to be received on our residual interests.
We may lose our investment in the residual interest and, except for our TEBS financings, realize additional losses to fully repay the senior trust obligations. An insolvency or receivership of the program sponsor could impair our ability to recover the assets and other collateral pledged in connection with a bond securitization financing.
We may lose our investment in the residual interest and, except for our TEBS financings and TEBS Residual Financing, realize additional losses to fully repay the senior trust obligations. An insolvency or receivership of the program sponsor could impair our ability to recover the assets and other collateral pledged in connection with a bond securitization financing.
In addition, if the General Partner determines that the ratio of the aggregate market value of issued and outstanding BUCs to the aggregate value of issued and outstanding Series A Preferred Units and Series A-1 Preferred Units has fallen below 1.0 and has remained below 1.0 for a period of 15 consecutive business days, then each holder of Series A, Series A-1 and Series B Preferred Units will have the right to redeem, in whole or in part, the Preferred Units held by such holder at a per unit redemption price equal to $10.00 per unit plus all declared and unpaid distributions thereon to the date of redemption.
In addition, if the General Partner determines that the ratio of the aggregate market value of issued and outstanding BUCs to the aggregate value of issued and outstanding Series A Preferred Units and Series A-1 Preferred Units has fallen below 1.0 and has remained below 1.0 for a period of 15 30 consecutive business days, then each holder of Series A, Series A-1 and Series B Preferred Units will have the right to redeem, in whole or in part, the Preferred Units held by such holder at a per unit redemption price equal to $10.00 per unit plus all declared and unpaid distributions thereon to the date of redemption.
Under the terms of the Series A and Series A-1 Preferred Units, upon the sixth anniversary of the closing of the sale to an investor, and upon each anniversary thereafter, each holder of such Preferred Units will have the right, but not the obligation, to cause the Partnership to redeem, in whole or in part, the units held by such holder at a per unit redemption price equal to $10.00 per unit plus an amount equal to all declared and unpaid distributions thereon to the date of redemption.
Under the terms of the Series A, Series A-1 and Series B Preferred Units, upon the sixth anniversary of the closing of the sale to an investor, and upon each anniversary thereafter, each holder of such Preferred Units will have the right, but not the obligation, to cause the Partnership to redeem, in whole or in part, the units held by such holder at a per unit redemption price equal to $10.00 per unit plus an amount equal to all declared and unpaid distributions thereon to the date of redemption.
In addition, the Preferred Units will rank junior to all Partnership current and future indebtedness (including indebtedness outstanding under the Partnership’s senior bank credit facility) and other liabilities, and any other senior securities we may issue in the future with respect to assets available to satisfy claims against the Partnership. Treatment of distributions on our Preferred Units is uncertain.
In addition, the Preferred Units will rank junior to all Partnership current and future indebtedness (including indebtedness 32 outstanding under the Partnership’s senior bank credit facility) and other liabilities, and any other senior securities we may issue in the future with respect to assets available to satisfy claims against the Partnership. Treatment of distributions on our Preferred Units is uncertain.
Under certain circumstances, holders of the Series A Preferred Units may have to repay amounts wrongfully returned or distributed to them. Under Section 17-607 of the Delaware Revised Uniform Limited Partnership Act, we may not make a distribution if the distribution would cause the Partnership’s liabilities to exceed the fair value of its assets.
Under certain circumstances, holders of the Preferred Units may have to repay amounts wrongfully returned or distributed to them. Under Section 17-607 of the Delaware Revised Uniform Limited Partnership Act, we may not make a distribution if the distribution would cause the Partnership’s liabilities to exceed the fair value of its assets.
The federal conservatorship of Freddie Mac and related efforts, along with any changes in laws and regulations affecting the relationship between Freddie Mac and the U.S. Government, may materially adversely affect our business. The problems faced by Fannie Mae and Freddie Mac commencing in 2008 resulting in them being placed into federal conservatorship and receiving significant U.S.
The federal conservatorship of Freddie Mac and related efforts, along with any changes in laws and regulations affecting the relationship between Freddie Mac and the U.S. Government, may materially adversely affect our business. 34 The problems faced by Fannie Mae and Freddie Mac commencing in 2008 resulting in them being placed into federal conservatorship and receiving significant U.S.
One of our secured line of credit facilities has a deficiency guaranty provided by an affiliate, Greystone Select Incorporated (“Greystone Select”), and is subject to various financial and non-financial covenants. A covenant default by Greystone Select will trigger a default on our obligations under the line of credit facility and accelerate amounts owed to the lenders.
One of our secured line of credit facilities has a deficiency guaranty provided by an affiliate, Greystone Select Incorporated (“Greystone Select”), and is subject to various financial and non-financial covenants. A covenant default by Greystone Select will trigger a default on our obligations under the line of credit facility supported by Greystone Select and accelerate amounts owed to the lenders.
If Freddie Mac were to be downgraded to below investment grade, it would have a negative effect on our 34 ability to finance our MRB portfolio on a longer-term basis and could negatively impact our cash flows from operations and our ability to continue distributions to our Unitholders at current levels.
If Freddie Mac were to be downgraded to below investment grade, it would have a negative effect on our ability to finance our MRB portfolio on a longer-term basis and could negatively impact our cash flows from operations and our ability to continue distributions to our Unitholders at current levels.
However, the primary source of principal and interest payments on these property loans is the net cash flow generated by these properties or the net proceeds from the sale or refinancing of these properties after payment of the related MRBs. The net cash flow from the operation of a property may be impacted by many factors as previously discussed.
The primary source of principal and interest payments on these property loans is the net cash flow generated by these properties or the net proceeds from the sale or refinancing of these properties after payment of the related MRBs. The net cash flow from the operation of a property may be impacted by many factors as previously discussed.
Whether because of a global or local financial crisis or other circumstances, such as if one or more of our lenders experiences severe financial difficulties, they or other lenders could become unwilling or unable to provide us with financing, could increase our retained interests required for such financing, or could increase the costs of that financing.
Whether because of a global or local financial crisis or other circumstances, such as if one or more of our lenders experiences severe financial difficulties, they or other lenders could become unwilling or unable to provide us with financing, could increase our retained interests required for such financing, or could increase the costs of financing.
If we are unable to generate sufficient cash from operations, we may need to reduce the level of cash distributions per BUC from current levels. In addition, there is no assurance that we will be able to maintain our current level of annual cash distributions per BUC even if we complete our current investment plans.
If we are unable to generate sufficient cash from operations, we may need to reduce the level of cash distributions per BUC from current levels. In addition, there is 29 no assurance that we will be able to maintain our current level of annual cash distributions per BUC even if we complete our current investment plans.
On December 14, 2021, the OCC adopted a final rule implementing these changes to its CRA regulations, which became effective on January 1, 2022. 31 Investments are not typically designated as qualifying investments by the OCC, FRB or FDIC at the time of issuance.
On December 14, 2021, the OCC adopted a final rule implementing these changes to its CRA regulations, which became effective on January 1, 2022. Investments are not typically designated as qualifying investments by the OCC, FRB or FDIC at the time of issuance.
To the extent we generate taxable income, Unitholders will be subject to income taxes on this income, whether or not they receive cash distributions. 33 As a partnership, our Unitholders are individually liable for income taxes on their proportionate share of any taxable income realized by us, whether or not we make cash distributions.
To the extent we generate taxable income, Unitholders will be subject to income taxes on this income, whether or not they receive cash distributions. As a partnership, our Unitholders are individually liable for income taxes on their proportionate share of any taxable income realized by us, whether or not we make cash distributions.
Increasing market interest rates will generally result in declining investment asset valuations, which may decrease the amount realized on the sale of our investments or the amount of debt financing that can be obtained from lenders, each resulting in lower returns on our investment assets.
Increasing market interest rates will generally result in declining investment asset valuations, which may decrease the amount realized on the sale of our investments or the amount of debt financing that can be obtained from lenders, each resulting in lower net returns on our investment assets.
We are subject to reinvestment risk from maturities and prepayments of our investment assets. Our MRB investments may have optional call dates that may be exercised by either the borrower or the Partnership that are earlier than the contractual maturity at either par or premiums to par.
We are subject to reinvestment risk from maturities and prepayments of our investment assets. Our MRB investments may have optional call dates that can be exercised by either the borrower or the Partnership that are earlier than the contractual maturity at either par or premiums to par.
In addition, our risks from derivative instruments include the following: • The costs to purchase our derivative instruments may not be recovered over the contractual term. • The counterparty may be unable to perform its obligations to us under the instrument. • If a liquid secondary market does not exist for these instruments, we may be required to maintain a derivative position until exercise or expiration, which could result in losses to us. • There may be a lack of available counterparties with acceptable credit profiles that are willing to originate derivative instruments for interest rate indices that match our variable interest rate exposure, such as the SIFMA index.
In addition, our risks from derivative instruments include the following: • The costs of purchasing our derivative instruments may not be recovered over the contractual term. • The counterparty may be unable to perform its obligations to us under the instrument. • If a liquid secondary market does not exist for these instruments, we may be required to maintain a derivative position until exercise or expiration, which could result in losses. • There may be a lack of available counterparties with acceptable credit profiles that are willing to originate derivative instruments for interest rate indices that match our variable interest rate exposure, such as the SIFMA index.
The Partnership may sell assets for reasons relating 32 to CRA qualification at times when such sales may not be desirable and may hold short-term investments that produce relatively low yields pending the selection of long-term investments believed to be CRA-qualified.
The Partnership may sell assets for reasons relating to CRA qualification at times when such sales may not be desirable and may hold short-term investments that produce relatively low yields pending the selection of long-term investments believed to be CRA-qualified.
The costs associated with the remediation of any such contamination may be significant and may exceed the value of a property or result in the property owner defaulting on the MRB, GIL or property loan secured by the property or otherwise result in a loss of our investment in the property.
The costs associated with the remediation of any such contamination may be 25 significant and may exceed the value of a property or result in the property owner defaulting on the MRB, GIL or property loan secured by the property or otherwise result in a loss of our investment in the property.
Conversely, if the revenue from our investment does not sufficiently cover the interest expense, hedging expense and other costs of the financing, our net income will be less or our net loss will be greater than if we had not borrowed funds.
Conversely, if the income from our investment does not sufficiently cover the interest expense, hedging expense and other costs of the financing, our net income will be less or our net loss will be greater than if we had not borrowed funds.
The loss of tax-exemption for any individual MRB or GIL would not, in and of itself, result in the loss of tax-exemption for any unrelated MRBs or GILs. However, the loss of such tax-exemption could result in the distribution to our Unitholders of taxable income relating to such MRBs and GILs.
The loss of tax-exemption for any individual MRB or GIL 33 would not, in and of itself, result in the loss of tax-exemption for any unrelated MRBs or GILs. However, the loss of such tax-exemption could result in the distribution to our Unitholders of taxable income relating to such MRBs and GILs.
In addition, because the senior securities may typically be tendered back to the trust, causing the trust to remarket the senior securities from time to time, an increase in interest rates may be required in order to successfully remarket these securities.
In addition, because the senior securities may be tendered back to the trust, causing the trust to remarket the senior securities from time to time, an increase in interest rates may be required in order to successfully remarket these securities.
By their nature, related party transactions may not be considered to have been negotiated at arm’s length. These relationships may also cause a conflict of interest in other situations where we are negotiating with Greystone or its affiliates. See Note 22 of the Partnership’s consolidated financial statements for additional details.
By their nature, related party transactions may not be considered to have been negotiated at arm’s length. These relationships may also cause a conflict of interest in other situations where we are negotiating with Greystone or its affiliates. See Note 23 of the Partnership’s consolidated financial statements for additional details.
The short-term nature of these leases generally serves to reduce the risk to the properties of the adverse effects of inflation; however, market conditions may prevent such properties from increasing rental rates in amounts sufficient to offset higher operating expenses. Rental rates for set-aside units at affordable multifamily properties are typically tied to certain percentages of the area median income.
The short-term nature of these leases generally serves to reduce the risk to the properties of the adverse effects of inflation; however, market conditions may prevent such properties from increasing rental rates in amounts sufficient to offset higher operating costs. Rental rates for set-aside units at affordable multifamily properties are typically tied to certain percentages of the area median income.
Conditions in the low income housing tax credit markets due to known or potential changes in U.S. corporate tax rates may increase our cost of borrowing, make financing difficult to obtain or restrict our ability to invest in MRBs and other investments, each of which may have a material adverse effect on our results of operations and our business.
Conditions in the low income housing tax credit markets due to known or potential changes in U.S. corporate tax rates may increase our cost of borrowing, make financing difficult to obtain or restrict our ability to invest in MRB and other investments, each of which may have a material adverse effect on our results of operations and our business.
However, significant defaults causing enforcement of guaranties against the two entities will negatively impact our ability to enforce our guaranties in the event of multiple defaults on our GIL and property loan investments. There is risk that a third-party developer that has provided guaranties of preferred returns on our Vantage JV Equity Investments may not perform.
However, significant defaults resulting in enforcement of guaranties against the two entities will negatively impact our ability to enforce our guaranties in the event of multiple defaults on our GIL and property loan investments. There is risk that a third-party developer that has provided guaranties of preferred returns on our Vantage JV Equity Investments may not perform.
Our ability to fund our operations, meet financial obligations, and finance targeted investment opportunities may be impacted by an inability to secure and maintain debt financing from current or potential future lenders. Our lenders are primarily large global financial institutions or regional commercial banks, with exposures both to global financial markets and to more localized economic conditions.
Our ability to fund our operations, meet financial obligations, and finance targeted investment opportunities may be impacted by an inability to secure and maintain debt financing from current or potential future lenders. Our lenders are primarily large global financial institutions or regional commercial banks, with exposure both to global financial markets and to more localized economic conditions.
Such cost increases may result in less distributable operating cash from our JV Equity Investments and may also result in lower property sales prices causing a reduction in distributions upon capital events. The majority of tenant leases related to various investment assets are for terms of one year or less.
Such cost increases may result in less distributable operating cash from our JV Equity Investments and may also result in lower property sales prices causing a reduction in distributions upon capital events. The majority of tenant leases related to multifamily investment assets are for terms of one year or less.
In the event the sponsor of an asset securitization financing program becomes insolvent, it could be placed in receivership. In that situation, it is possible that we would not be able to recover the investment assets or other collateral pledged in connection with the securitization financing or that we will not receive all payments due on our residual interests.
In the event the sponsor of an asset securitization financing program becomes insolvent, it could be placed in receivership. In that situation, it is possible that we may not be able to recover the investment assets or other collateral pledged in connection with the securitization financing or that we will not receive all payments due on our residual interests.
Interest rates have risen in recent months, and the risk that they may continue to do so is pronounced. In addition, a decreased U.S. government credit rating could create broader financial turmoil and uncertainty, which may weigh heavily on our financial performance and the market value of our BUCs.
Interest rates have risen in recent years, and the risk that they may continue to do so is pronounced. In addition, a decreased U.S. government credit rating could create broader financial turmoil and uncertainty, which may weigh heavily on our financial performance and the market value of our BUCs.
We may also be subject to government regulations, natural disasters, and environmental issues, any of which could have an adverse effect on our financial results, cash flows and our ability to sell the properties. Properties related to our MRBs and JV Equity Investments are geographically concentrated in certain states.
We may also be subject to government regulations, natural disasters, and environmental issues, any of which could have an adverse effect on our financial results, cash flows and our ability to sell the properties. Properties related to our MRB investments and JV Equity Investments are geographically concentrated in certain states.
If there is a default, we are entitled to the borrower's original allocation of LIHTCs, which we can monetize through sales to third party investors. The value of the LIHTCs is dependent on market demand and the underlying properties ability to cover debt service during the permanent financing phase, which is uncertain.
If there is a default, we are entitled to the borrower's original allocation of LIHTCs, which we can monetize through sales to third party investors. The value of LIHTCs is dependent on market demand and the underlying property’s ability to cover debt service during the permanent financing phase, which is uncertain.
The inappropriate use of certain media could cause brand damage or information leakage. Negative posts or comments about the Partnership on any social networking web site could seriously damage its reputation. In addition, the disclosure of non-public information through external media channels could have a negative impact to the Partnership.
The inappropriate use of certain media could cause brand damage or information leakage. Negative posts or comments about the Partnership on any social networking web site could seriously damage our reputation. In addition, the disclosure of non-public information through external media channels could have a negative impact to the Partnership.
We have no way to predict the duration or outcome of the situation, as the conflict and government reactions are rapidly developing and beyond our control. Prolonged unrest, military activities, or broad-based sanctions may increase our funding costs or limit our access to the capital markets.
We have no way to predict the duration or outcome of the situation, as the conflicts and government reactions are rapidly developing and beyond our control. Prolonged unrest, military activities, or broad-based sanctions may increase our funding costs or limit our access to the capital markets.
The terms of these securitization programs differ, but in general require our investment assets be placed into a trust or other special purpose entity that issues a senior security to unaffiliated investors while we retain a residual interest.
The terms of these securitization programs differ, but in general require our investment assets be placed into a trust or other special purpose entity that issues senior securities to unaffiliated investors while we retain a residual interest.
Risks Related to Ownership of Beneficial Unit Certificates and Preferred Units • Cash distributions related to BUCs may change at the discretion of the Partnership’s general partner. • Inflation may cause the real value of distributions on our BUCs and Preferred Units to decline. • Any future issuances of additional BUCs could cause their market value to decline. • Certain rights of our BUC holders are limited by and subordinate to the rights of the holders of our Series A Preferred Units and Series A-1 Preferred Units and, if issued, Series B Preferred Units, and these rights may have a negative effect on the value of the BUCs. • Holders of Preferred Units have extremely limited voting rights. • The Partnership’s general partner has the authority to declare cash distributions related to the Preferred Units. • Holders of Preferred Units may have liability to repay distributions. • We may be required to redeem Preferred Units in the future. • The assets held by the Partnership may not be considered qualified investments under the Community Reinvestment Act (“CRA”) by the bank regulatory authorities. • Under certain circumstances, investors may not receive CRA credit for their investment in the Preferred Units. • The Partnership’s portfolio investment decisions may create CRA strategy risks. • The Preferred Units are subordinated to existing and future debt obligations, and the interests could be diluted by the issuance of additional units, including additional Preferred Units, and by other transactions. • Holders of the Preferred Units may be required to bear the risks of an investment for an indefinite period of time. • Treatment of distributions on our Preferred Units is uncertain. • There is no public market for the Preferred Units, which may prevent an investor from liquidating its investment. • Market interest rates may adversely affect the value of the Preferred Units.
Risks Related to Ownership of Beneficial Unit Certificates and Preferred Units • Cash distributions related to BUCs may change at the discretion of the Partnership’s general partner. • Sustained high levels of inflation may cause the real value of distributions on our BUCs and Preferred Units to decline. • Any future issuances of additional BUCs could cause the market value of all outstanding BUCs to decline. • Certain rights of our BUC holders are limited by and subordinate to the rights of the holders of our Series A Preferred Units, Series A-1 Preferred Units and Series B Preferred Units, and these rights may have a negative effect on the value of the BUCs. • Holders of Preferred Units have extremely limited voting rights. • The Partnership’s general partner has the authority to declare cash distributions related to the Preferred Units. • Holders of Preferred Units may have liability to repay distributions. • We may be required to redeem Preferred Units in the future. • The assets held by the Partnership may not be considered qualified investments under the Community Reinvestment Act (“CRA”) by the bank regulatory authorities. • Under certain circumstances, investors may not receive CRA credit for their investment in the Preferred Units. • The Partnership’s portfolio investment decisions may create CRA strategy risks. • The Preferred Units are subordinated to existing and future debt obligations, and the interests could be diluted by the issuance of additional units, including additional Preferred Units, and by other transactions. • Holders of the Preferred Units may be required to bear the risks of an investment for an indefinite period of time. • Treatment of distributions on our Preferred Units is uncertain. • There is no public market for the Preferred Units, which may prevent an investor from liquidating its investment. • Market interest rates may adversely affect the value of the Preferred Units.
However, if circumstances change such that our traditional liquidity sources and debt financing arrangements are insufficient, we may need to obtain funds by other methods, including, but not limited to, alternative financing arrangements, sales of assets, or raise additional capital. This could negatively impact our results of operations through higher costs or lower investment returns.
However, if circumstances change such that our traditional liquidity sources and debt financing arrangements are insufficient, we may need to obtain funds from other sources, including, but not limited to, alternative financing arrangements, sales of assets, or raise additional capital. This could negatively impact our results of operations through higher costs or lower investment returns.
Risks Related to Income Taxes • Income from various investments is subject to taxation. • To the extent we generate taxable income, Unitholders will be subject to income taxes on this income, whether or not they receive cash distributions. • There are limits on the ability of our Unitholders to deduct Partnership losses and expenses allocated to them. • Unitholders may incur tax liability if any of the interest on our MRBs or GILs is determined to be taxable. • If we are determined to be an association taxable as a corporation, it will have adverse economic consequences for us and our Unitholders.
Risks Related to Income Taxes • Income from various investments is subject to taxation. • To the extent we generate taxable income, Unitholders will be subject to income taxes on this income, whether or not they receive cash distributions. • There are limits on the ability of our Unitholders to deduct Partnership losses and expenses allocated to them. • Unitholders may incur tax liability if any of the interest on our MRB or GIL investments is determined to be taxable. • If we are determined to be an association taxable as a corporation, it will have adverse economic consequences for us and our Unitholders.
We can offer no assurance that continued significant changes in market interest rates would not have a material adverse effect on our net income and CAD. In this period of rising interest rates, our cost of funds may further increase, which could reduce our net income and CAD. We are subject to risks related to inflation.
We can offer no assurance that continued significant changes in market interest rates would not have a material adverse effect on our net income and CAD. In periods of rising interest rates, our cost of funds may further increase, which could reduce our net income and CAD. We are subject to risks related to inflation.
Specific risks generally associated with these asset securitization programs include the following: 27 Changes in interest rates can adversely affect the cost of the asset securitization financing. The interest rates payable on certain senior securities are variable. The senior securities associated with our M33 TEBS and TOB trust securitizations have variable interest rates that reset on a weekly basis.
Specific risks generally associated with these asset securitization programs include the following: Changes in interest rates can adversely affect the cost of the asset securitization financing. The interest rates payable on certain senior securities are variable. The senior securities associated with our M33 TEBS and TOB trust securitizations have variable interest rates that reset on a weekly or daily basis.
In particular, the consequences of the Russian military invasion of Ukraine, including comprehensive international sanctions, the impact on inflation and increased disruption to supply chains may impact our counterparties with which we do business, and specifically our financing counterparties and financial institutions from which we obtain financing for the purchase of our MRBs, GILs, and other investments, result in an economic downturn or recession either globally or locally in the U.S. or other economies, reduce business activity, spawn additional conflicts (whether in the form of traditional military action, reignited “cold” wars or in the form of virtual warfare such as cyberattacks) with similar and perhaps wider ranging impacts and consequences and have an adverse impact on the Partnership’s returns, net income, and Cash Available for Distribution (“CAD”).
In particular, current military conflicts, including comprehensive international sanctions, the impact on inflation and increased disruption to supply chains may impact our counterparties with which we do business, and specifically our financing counterparties and financial institutions from which we obtain financing for the purchase of our investments, result in an economic downturn or recession either globally or locally in the U.S. or other economies, reduce business activity, spawn additional conflicts (whether in the form of traditional military action, reignited “cold” wars or in the form of virtual warfare such as cyberattacks) with similar and perhaps wider ranging impacts and consequences and have an adverse impact on the Partnership’s returns, net income, and Cash Available for Distribution (“CAD”).
The standard replaced the incurred loss impairment methodology with a methodology that reflects current expected credit losses (“CECL”) and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates.
The CECL standard replaced the incurred loss impairment methodology with a methodology that reflects current expected credit losses and requires consideration of a broader range of reasonable and supportable information to inform credit loss estimates.
Certain rights of our BUC holders are limited by and subordinate to the rights of the holders of our Series A Preferred Units and Series A-1 Preferred Units and, if issued, Series B Preferred Units, and these rights may have a negative effect on the value of the BUCs.
Certain rights of our BUC holders are limited by and subordinate to the rights of the holders of our Series A Preferred Units, Series A-1 Preferred Units and Series B Preferred Units, and these rights may have a negative effect on the value of the BUCs.
The properties securing our MRBs are geographically dispersed throughout the United States, with significant concentrations in Texas, California, and South Carolina. Such concentrations expose us to potentially negative effects of local or regional economic downturns, which could prevent us from collecting principal and interest on our MRBs.
The properties securing our MRB investments are geographically dispersed throughout the United States, with significant concentrations in Texas, California, and South Carolina. Such concentrations expose us to potentially negative effects of local or regional economic downturns, which could prevent us from collecting principal and interest on our investments.
The lease-up of these properties may not be completed on schedule or at anticipated rent levels, resulting in a greater risk of default versus investments secured by mortgages on properties that are stabilized or fully leased. The properties may not achieve expected occupancy or debt service coverage levels.
The lease-up of these properties may not be completed on schedule or at anticipated rent levels, resulting in a greater risk of default compared to investments secured by mortgages on properties that are stabilized or fully leased. Properties may not achieve expected occupancy or debt service coverage levels.
The recognition of other-than-temporary impairment, provisions for credit losses, provisions for loan loss and the related impairment analyses are subject to a considerable degree of judgment, the results of which, when applied under different conditions or assumptions, could have a material impact on the Partnership’s consolidated financial statements.
The recognition of other-than-temporary impairment, provisions for credit losses, provisions for loan loss are subject to a considerable degree of judgment, the results of which, when applied under different conditions or assumptions, could have a material impact on the Partnership’s consolidated financial statements.
We cannot assure you that we will have access to adequate equity or debt capital on favorable terms (including, without limitation, cost, advance rates, and term) at the desired times, or at all, which may cause us to curtail our asset acquisition activities and/or dispose of assets, which could materially adversely affect our operating cash flows and results of operations.
We cannot assure you that we will have access to adequate equity or debt capital on favorable terms (including, without limitation, cost, advance rates, and term) at the desired times, or at all, which may cause us to curtail our new investment activities and/or dispose of assets, which could materially adversely affect our operating cash flows and results of operations.
Realized impairments may differ from our current estimates and could negatively impact the Partnership’s financial condition, cash flows, and reported earnings. Any such impacts could be caused by various factors, including, but not limited to, unanticipated adverse changes in the economy or events adversely affecting specific assets, borrowers, or markets in which our borrowers or their properties are located.
Realized impairments and losses may differ from our current estimates and could negatively impact the Partnership’s financial condition, cash flows, and reported earnings and could be caused by various factors, including, but not limited to, unanticipated adverse changes in the economy or events adversely affecting specific assets, borrowers, or markets in which our borrowers or their properties are located.
In addition, our GILs and most property loans are prepayable at any time without penalty. Borrowers may choose to redeem our investments if prevailing market interest rates are lower than the interest rate on our investment assets or for other various reasons.
In addition, our GIL investments and most property loans are prepayable at any time without penalty. Borrowers may choose to redeem our investments if prevailing market interest rates are lower than the interest rate on our investment assets or for other reasons.
If Freddie Mac is not required to purchase the GIL and payment of the property loans from available sources is not made, the GIL and property loan will have defaulted and our recourse is to foreclose on the underlying property. We will also enforce our available recourse guaranty provisions against affiliates of the borrower.
If Freddie Mac is not required to purchase the GIL and payment of the property loans from available sources is not made, the GIL and property loan will default and our recourse is to foreclose on the underlying property. We will also enforce our available recourse guaranty provisions against affiliates of the borrower.
In each MRB and GIL transaction, the governmental issuer, as well as the underlying borrower, has covenanted and agreed to comply with all applicable legal and regulatory requirements necessary to establish and maintain the tax-exempt status of interest earned on the MRBs and GILs.
In each MRB and GIL transaction, the governmental issuer, as well as the underlying borrower, has covenanted and agreed to comply with all applicable legal and regulatory requirements necessary to establish and maintain the tax-exempt status of interest earned on the MRB and GIL investments.
Our results of operations, financial condition and business could be materially adversely affected if our fair value determinations of these assets are materially higher than what could actually be realized in the market. The market value of our investment assets may be adversely impacted by increasing interest rates.
Our results of operations, financial condition and business could be materially adversely affected if our fair value estimates are materially higher than what could actually be realized in the market. The market value of our investment assets may be adversely impacted by increasing interest rates.
As a result, our net income and CAD will depend, in part, upon the difference between the rate at which we borrow funds and the yields on our investments in those instruments. If debt financing is unavailable at acceptable rates, we may not be able to purchase and finance additional investments at an acceptable levered return.
As a result, our net income and CAD will depend, in part, upon the difference between the rate at which we borrow funds and the yields on our investment assets. If debt financing is unavailable at acceptable rates, we may not be able to purchase and finance additional investments at an acceptable levered return.
Though our investment assets are not cross collateralized with each other, management or other issues with an individual developer or its affiliates may impact multiple investment assets associated with the individual developer, resulting in potential lower debt service coverage, and investment or asset impairments. Recourse guaranties related to our GILs and property loans are concentrated in certain entities.
Though our investment assets are not cross collateralized with each other, management or other issues with an individual developer or its affiliates may impact multiple investment assets associated with the developer, resulting in potential lower debt service coverage, and investment or asset impairments. 24 Recourse guaranties related to our GIL investments and property loans are concentrated in certain entities.
The Partnership’s general partner manages our investments, performs administrative services for us and earns administrative fees that are paid by either the borrowers related to our MRBs, GILs or by us, subject to the terms of the Partnership Agreement. The general partner does not have a fiduciary duty or obligation to any limited partner or BUC holder.
The Partnership’s general partner manages our investments, performs administrative services for us and earns administrative fees that are paid by either the borrowers related to our investment assets or by us, subject to the terms of the Partnership Agreement. The general partner does not have a fiduciary duty or obligation to any limited partner or BUC holder.
Inflation risk is the risk that the value of assets or income from investments will be worth less in the future as inflation decreases the value or purchasing power of money. Inflation rates may change frequently and significantly as a result of various factors, including unexpected shifts in the domestic or global economy and changes in economic policies.
Inflation risk is the risk that the value of assets or income from investments will be worth less in the future as inflation decreases the value or purchasing power of money. Inflation rates may change frequently and significantly due to various factors, including unexpected shifts in the domestic or global economy and changes in economic policies.
As a result, a sale of an investment could result in a loss to the Partnership. We estimate values of our investment assets in the preparation of our financial statements.
The sale of an investment could result in a loss to the Partnership. 20 We estimate values of our investment assets in the preparation of our financial statements.
Any change in our distribution policy could have a material adverse effect on the market price of our BUCs. Inflation may cause the real value of distributions on our BUCs and Preferred Units to decline.
Any change in our distribution policy could have a material adverse effect on the market price of our BUCs. Sustained high levels of inflation may cause the real value of distributions on our BUCs and Preferred Units to decline.
If we and our service providers do not allocate and effectively manage the resources necessary to build and sustain the proper technology infrastructure and to maintain and protect the related automated and manual control processes, we could be subject to business disruptions or damage resulting from security breaches.
If we and our service providers do not allocate and effectively manage the resources necessary to build and sustain the proper technology infrastructure and to maintain and protect the related automated and manual control processes, we could be subject to business disruptions or damage resulting from cybersecurity incidents.
In addition, Freddie Mac, through a servicer, has forward committed to purchase our GILs at maturity at par if the property has reached stabilization and other conditions are met.
In addition, Freddie Mac, through a servicer, has forward committed to purchase our GIL investments at maturity at par if the property has reached stabilization and other conditions are met.
Our third-party service providers and Greystone affiliates are primarily responsible for the security of their own information technology environments and, in certain instances, we rely significantly on third-party service providers to supply and store our sensitive data in a secure manner.
Our third-party information technology service providers, including an affiliate of Greystone, are primarily responsible for the security of their own information technology environments and, in certain instances, we rely significantly on third-party service providers to supply and store our sensitive data in a secure manner.
There are concentrations with certain developers with our MRB, GIL, property loan, and JV Equity Investment asset classes. The developers and their affiliates typically mange the construction and operations of the underlying properties.
There are concentrations with certain developers with our MRB, GIL, property loan, and JV Equity Investment asset classes. The developers and their affiliates manage the construction and operations of the underlying properties.
These conditions may negatively impact the pace and cost of properties under construction. Over time, these conditions could result in declining demand and operating results for properties related to our investment assets. Climate change may also have indirect effects on our business by increasing the cost and/or availability of property insurance and increased repair and maintenance costs.
Over time, these conditions could result in declining demand and operating results for properties related to our investment assets. Climate change may also have indirect effects on our business by increasing the cost and/or availability of property insurance and increased repair and maintenance costs.
Increases in area median income are not necessarily correlated to increases in property operating expenses. A significant mismatch between area median income growth and property operating expense increases could negatively impact net operating cash flows available to pay debt service. Inflation may cause increases in construction costs for properties under construction that secure our MRB and GIL investments.
Increases in area median income are not necessarily correlated to increases in property operating costs. A significant mismatch between area median income growth and property operating cost increases could negatively impact net operating cash flows available to pay debt service. Inflation may cause increases in construction costs for properties under construction that secure our investments.
If the underlying market-rate multifamily rental properties do not generate sufficient cash proceeds, either through net cash flows from operations or upon a sale event or refinancing, then we are entitled to enforce the guaranty against the guarantor.
If the underlying market-rate multifamily rental properties do not generate sufficient cash proceeds, either through net cash flows from operations or upon a sale event or refinancing, then we can enforce the guaranty against the guarantor.
All such third-party vendors face risks relating to cybersecurity similar to ours which could disrupt their businesses and therefore adversely impact us. While we provide guidance and specific requirements in some cases, we do not directly control any of such parties’ information technology security operations, or the amount of investment they place in guarding against cybersecurity threats.
All such third-party vendors face risks relating to cybersecurity incidents that could disrupt their businesses and therefore adversely impact us. While we provide guidance and specific requirements in 35 some cases, we do not directly control any of such parties’ information technology security operations, or the amount of investment they place in guarding against cybersecurity threats.
In addition, we have, and may in the future, obtain debt financing through asset securitization programs in which we place MRBs and GILs into trusts and are entitled to a share of the interest received by the trust on these bonds after the payment of interest on senior securities and related expenses issued by the trust.
In addition, we have, and may in the future, obtain debt financing through asset securitization programs in which we place MRB and GIL investments into trusts and are entitled to a share of the interest received by the trust on these bonds after the payment of interest on senior securities and related expenses issued by the trust.
The yields on our investments may not keep pace with inflation, which may result in losses to our unitholders. This risk is greater for fixed-income investments with longer maturities. Inflation could cause increases in our general and administrative costs causing a decrease in our operating cash flows.
The yields on our investments may not keep pace with inflation, which may result in losses to our Unitholders. This risk is greater for fixed-income investments with longer maturities such as our MRB investments. Inflation could cause increases in our general and administrative costs resulting in a decrease in our operating cash flows.
Because of the non-recourse nature, the sole source of cash to make regular principal and interest on the MRB is the net cash flow generated by the operation of the secured property and the net proceeds from the ultimate sale or refinancing of the property (except in cases where a property owner or its affiliates has provided a limited guaranty of certain payments).
Instead, each MRB is backed by a non-recourse obligation of the owner of the secured property and the sole source of cash to make regular principal and interest on the MRB is the net cash flow generated by the operation of the secured property and the net proceeds from the ultimate sale or refinancing of the property (except in cases where a property owner or its affiliates has provided a limited guaranty of certain payments).
Changes in the U.S. tax rates, and the resulting impacts to the low income housing tax credit market, may limit our ability to 23 replace or renew maturing debt financing on a timely basis, may impair our ability to acquire MRBs, GILs and other investments and may impair our access to capital markets to meet our liquidity and growth requirements which may have an adverse effect on our financial condition and results of operations.
Changes in the U.S. tax rates, and the resulting impacts to the low income housing tax credit market, may limit our ability to replace or renew maturing debt financing on a timely basis, may impair our ability to acquire new investments and may impair our access to capital markets to meet our liquidity and growth strategies which may have an adverse effect on our financial condition and results of operations.
The purpose of this determination is to eliminate federal and state income tax liability for us and allow us to pass through our interest income on our MRBs and GILs, which we expect and believe to be tax-exempt, to our Unitholders so that they are not subject to federal income tax on this income.
The purpose of this determination is to eliminate federal and state income tax liability for us and allow us to pass through our interest income on our MRB and GIL investments, which we expect and believe to be tax-exempt, to our Unitholders so that they are not subject to federal income tax on this income.
This makes our investments in these MRBs subject to risks usually associated with direct investments in such properties. If a property is unable to sustain net cash flow at a level necessary to pay its debt service obligations on our MRB, a default may occur.
This makes our MRB investments subject to risks usually associated with direct investments in such properties. Defaults may occur if a property is unable to sustain net cash flow at a level necessary to pay its debt service obligations.
The net cash flow from the operation of a seniors housing property may be affected by many factors, such as the number of tenants, rental rates, service revenues, payroll costs, operating expenses, the cost of repairs and maintenance, taxes, government regulation, competition from other seniors housing properties, the availability of alternative housing options such as single-family housing, adverse developments or conditions resulting from or associated with climate change, and general and local economic conditions.
The net cash flow from the operation of a seniors housing property is affected by many factors, including but not limited to, the number of tenants, rental rates, service revenues, payroll costs, operating expenses, the cost of repairs and maintenance, taxes, government regulation, competition from other seniors housing properties, the availability of alternative housing options such as single-family housing, adverse developments or conditions resulting from or associated with climate change, and general and local economic conditions.
Further, rising interest rates could also adversely affect our performance if we hold investments with variable interest rates, subject to specified minimum interest rates (such as a London Interbank Bank Offering Rate (“LIBOR”) or Secured Overnight Financing Rate (“SOFR”) floor, as applicable), while at the same time engaging in borrowings subject to variable interest rates not subject to such minimums.
Further, rising interest rates could also adversely affect our performance if we hold investments with variable interest rates, subject to specified minimum interest rates (such as a Secured Overnight Financing Rate (“SOFR”) floor, as applicable), while at the same time engaging in borrowings subject to variable interest rates not subject to such minimums.
If such conditions are not met, then Freddie Mac is not required to purchase the GIL and we will pursue collection via other means. Alternatively, Freddie Mac may purchase the GIL at a value lower than par, which would then require the borrower to use additional sources to repay the principal on our GIL investment.
If such conditions are not met, then Freddie Mac is not required to purchase the GIL and we will pursue collection via other means. Alternatively, Freddie Mac may purchase the GIL in an amount lower than par, which would then require the borrower to use additional sources to repay the principal on our GIL investment.
In periods of rising interest rates, such as the current interest rate environment, to the extent we borrow money subject to a variable interest rate, our cost of funds would increase, which could reduce our net income.
In periods of rising interest rates, to the extent we borrow money subject to a variable interest rate, our cost of funds would increase, which could reduce our net income.
Also, if we foreclose on a property, we will no longer receive interest on the MRB, GIL and/or property loan secured by the property. The overall return to us from our investment in this circumstance is likely to be less than if the construction had been completed on time or within budget.
Also, if we foreclose on a property, we will no longer receive interest on the debt investments secured by the property. The overall return to us from our investment in this circumstance is likely to be less than if the construction had been completed on time and within budget.
However, once the capitalized interest has been exhausted for each property, interest is payable from net operating cash flows of the secured property, which is dependent to a large degree on the property’s operating results.
Once capitalized interest has been exhausted for a property, interest is payable from net operating cash flows, which is dependent to a large degree on the property’s operating results.
In such case, we may be forced to foreclose on the incomplete property and sell it in order to recover the principal and accrued interest on our MRB, GIL and/or property loan investments, resulting in losses.
In such case, we may be forced to foreclose on the incomplete property and sell it in order to recover the principal and accrued interest on our investments, resulting in losses.

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Item 2. Properties

Properties — owned and leased real estate

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Biggest changeWe also have property loans that are also secured by these properties but do not hold title or any other interest in the properties. 36 We owned the Suites on Paseo and certain land held for development that are reported within the MF Properties segment as of December 31, 2022.
Biggest changeWe also have property loans that are also secured by these properties but do not hold title or any other interest in the properties. Our JV Equity Investments represent membership interests in market-rate multifamily and seniors housing properties, but we do not hold title to such properties.
See Note 5 of the consolidated financial statements in Item 8 for further information. (2) Land held for development consists of land and development costs for parcels of land in Richland County, SC and Omaha, NE.
See Note 5 of the consolidated financial statements in Item 8 for further information. (2) Land held for development consists of land and development costs for parcels of land in Richland County, SC.
We recorded one JV Equity Investment as a consolidated VIE and it is reported within the Market-Rate Joint Venture Investments segment as of December 31, 2022.
We recorded one JV Equity Investment as a consolidated VIE and it is reported within the Market-Rate Joint Venture Investments segment as of December 31, 2023. We own certain land held for development that is reported within the Affordable Multifamily MRB Investments segment as of December 31, 2023.
Our real estate assets are summarized as follows: Real Estate Assets as of December 31, 2022 Property Name Location Number of Units Land and Land Improvements Buildings and Improvements Carrying Value Suites on Paseo San Diego, CA 384 $ 3,199,244 $ 39,799,082 $ 42,998,326 Vantage at San Marcos San Marcos, TX (1) 2,660,615 1,003,857 3,664,472 Land held for development (2) 1,551,196 - 1,551,196 $ 48,213,994 Less accumulated depreciation (11,663,516 ) Real estate assets, net $ 36,550,478 (1) The assets are owned by a consolidated VIE for the development of a market-rate multifamily property.
Our real estate assets are summarized as follows: Real Estate Assets as of December 31, 2023 Property Name Location Number of Units Land and Land Improvements Buildings and Improvements Carrying Value Vantage at San Marcos San Marcos, TX (1) 2,660,615 946,043 3,606,658 Land held for development (2) 1,109,482 - 1,109,482 $ 4,716,140 Less accumulated depreciation - Real estate assets, net $ 4,716,140 (1) The assets are owned by a consolidated VIE for the development of a market-rate multifamily property.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changeUnregistered Sale of Equity Securities The Partnership did not sell any BUCs in 2022 or 2021 that were not registered under the Securities Act of 1933, as amended. There were no sales of unregistered Preferred Units in 2022 or 2021. The Partnership did not repurchase any outstanding BUCs during the fourth quarter of 2022. 38
Biggest changeUnregistered Sale of Equity Securities The Partnership did not sell any BUCs in 2023 or 2022 that were not registered under the Securities Act of 1933, as amended. There were no sales of unregistered Preferred Units in 2023 or 2022. The Partnership did not repurchase any outstanding BUCs during the fourth quarter of 2023. 38
Equity Compensation Plan Information The following table provides information with respect to compensation plans under which equity securities of the Partnership are currently authorized for issuance as of December 31, 2022: Number of shares to be issued upon exercise of outstanding options, warrants, and rights Weighted-average price of outstanding options, warrants, and rights Number of shares remaining available for future issuance under equity compensation plans (excluding shares reflected in column (a)) Plan Category (a) (b) (c) Equity compensation plans approved by Unitholders 87,334 $ - 478,155 (1) Equity compensation plan not approved by Unitholders - - - Total 87,334 $ - 478,155 (1) Represents the BUCs which remain available for future issuance under the Amended and Restated Greystone Housing Impact Investors LP 2015 Equity Incentive Plan.
Equity Compensation Plan Information The following table provides information with respect to compensation plans under which equity securities of the Partnership are currently authorized for issuance as of December 31, 2023: Number of shares to be issued upon exercise of outstanding options, warrants, and rights Weighted-average price of outstanding options, warrants, and rights Number of shares remaining available for future issuance under equity compensation plans (excluding shares reflected in column (a)) Plan Category (a) (b) (c) Equity compensation plans approved by Unitholders 95,600 $ - 401,595 (1) Equity compensation plan not approved by Unitholders - - - Total 95,600 $ - 401,595 (1) Represents the BUCs which remain available for future issuance under the Amended and Restated Greystone Housing Impact Investors LP 2015 Equity Incentive Plan.
Item 5. Market for the Registrant’s Common Equity, Related Security Holder Matters and Issuer Purchases of Equity Securities. Market Information The Partnership’s BUCs trade on the NYSE under the trading symbol “GHI.” BUC Holder Information As of January 31, 2023, we had 22,538,878 BUCs outstanding held by a total of approximately 16,200 holders of record.
Item 5. Market for the Registrant’s Common Equity, Related Security Holder Matters and Issuer Purchases of Equity Securities. Market Information The Partnership’s BUCs trade on the NYSE under the trading symbol “GHI.” BUC Holder Information As of January 31, 2024, we had 22,897,082 BUCs outstanding held by a total of approximately 16,800 holders of record.
In addition, the Partnership had outstanding unvested restricted unit awards (“RUA” or “RUAs”) for 87,334 BUCs held by 16 individuals as of December 31, 2022. Distributions Future distributions paid by the Partnership per BUC will be at the sole discretion of its General Partner and will be based upon financial, capital, and cash flow considerations.
In addition, the Partnership had outstanding unvested restricted unit awards (“RUA” or “RUAs”) for 95,600 BUCs held by 18 individuals as of December 31, 2023. Distributions Future distributions paid by the Partnership per BUC will be at the sole discretion of its General Partner and will be based upon financial, capital, and cash flow considerations.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeThe following table summarizes our outstanding investment commitments as of December 31, 2022: 61 Projected Funding by Year (1) Property Name Commitment Date Asset Maturity Date Total Initial Commitment Remaining Commitment as of December 31, 2022 2023 2024 2025 Interest Rate (2) Related Debt Financing (3) Mortgage Revenue Bonds Residency at the Mayer - Series A October 2021 April 2039 $ 29,500,000 $ 3,500,000 $ 3,500,000 $ - $ - SOFR + 3.60% Variable TOB Meadow Valley December 2021 December 2029 44,000,000 39,276,563 17,200,000 22,076,563 - 6.25% (6) Residency at the Entrepreneur- Series J-3 April 2022 March 2040 26,080,000 22,180,000 22,180,000 - - 6.00% Variable TOB Residency at the Entrepreneur- Series J-4 April 2022 March 2040 16,420,000 16,420,000 6,400,000 10,020,000 - SOFR + 3.60% (4) Variable TOB Residency at Empire - Series BB-3 December 2022 December 2040 14,000,000 13,945,000 13,945,000 - - 6.45% (9) (6) Residency at Empire - Series BB-4 December 2022 December 2040 47,000,000 47,000,000 8,400,000 34,700,000 3,900,000 6.45% (11) (6) Subtotal 177,000,000 142,321,563 71,625,000 66,796,563 3,900,000 Taxable Mortgage Revenue Bonds Residency at the Mayer Series A-T October 2021 April 2024 (5) $ 12,500,000 $ 11,500,000 $ 11,500,000 $ - $ - SOFR + 3.70% Variable TOB Residency at the Entrepreneur Series J-T April 2022 April 2025 (5) 13,000,000 12,000,000 - 12,000,000 - SOFR + 3.65% Variable TOB Residency at Empire - Series BB-T December 2022 December 2025 (5) 9,404,500 8,404,500 - - 8,404,500 7.45% (6) Subtotal 34,904,500 31,904,500 11,500,000 12,000,000 8,404,500 Governmental Issuer Loans Osprey Village July 2021 August 2024 (5) $ 60,000,000 $ 20,106,960 $ 20,106,960 $ - $ - SOFR + 3.07% Variable TOB Willow Place Apartments September 2021 October 2024 (5) 25,000,000 7,645,528 7,645,528 - - SOFR + 3.30% Variable TOB Poppy Grove I September 2022 April 2025 (5) 35,688,328 27,842,328 27,842,328 - - 6.78% Variable TOB Poppy Grove II September 2022 April 2025 (5) 22,250,000 17,708,700 12,410,000 5,298,700 - 6.78% Variable TOB Poppy Grove III September 2022 April 2025 (5) 39,119,507 30,569,507 21,880,000 8,689,507 - 6.78% Variable TOB Subtotal 182,057,835 103,873,023 89,884,816 13,988,207 - Taxable Governmental Issuer Loans Hope on Avalon January 2021 August 2023 $ 10,573,000 $ 5,573,000 $ 5,573,000 $ - $ - SOFR + 3.55% Variable TOB Poppy Grove I September 2022 April 2025 (5) 21,157,672 20,157,672 - 20,157,672 - 6.78% Variable TOB Poppy Grove II September 2022 April 2025 (5) 10,941,300 9,941,300 - 9,941,300 - 6.78% Variable TOB Poppy Grove III September 2022 April 2025 (5) 24,480,493 23,480,493 - 19,980,493 3,500,000 6.78% Variable TOB Subtotal 67,152,465 59,152,465 5,573,000 50,079,465 3,500,000 Property Loans Oasis at Twin Lakes July 2020 August 2023 (5) $ 27,704,180 $ 3,685,523 $ 3,685,523 $ - $ - LIBOR + 2.50% Variable TOB Hilltop at Signal Hills January 2021 August 2023 (5) 21,197,939 1,479,605 1,479,605 - - SOFR + 3.07% Variable TOB Legacy Commons at Signal Hills January 2021 February 2024 (5) 32,233,972 2,567,067 2,567,067 - - SOFR + 3.07% Variable TOB Osprey Village July 2021 August 2024 (5) 25,500,000 24,500,000 24,500,000 - - SOFR + 3.07% Variable TOB Willow Place Apartments September 2021 October 2024 (5) 21,351,328 20,351,328 20,351,328 - - SOFR + 3.30% Variable TOB Magnolia Heights June 2022 July 2024 (5) 10,300,000 4,111,399 4,111,399 - - SOFR + 3.85% Variable TOB Subtotal 138,287,419 56,694,922 56,694,922 - - Equity Investments Vantage at San Marcos (7), (10) November 2020 N/A $ 9,914,529 $ 8,943,914 $ 8,943,914 $ - $ - N/A N/A Freestone Greeley (10) October 2022 N/A 16,035,710 11,325,008 11,325,008 - - N/A N/A Freestone Cresta Bella (10) November 2022 N/A 16,405,514 10,204,191 10,204,191 - - N/A N/A Subtotal 42,355,753 30,473,113 30,473,113 - - Bond Purchase Commitments Anaheim & Walnut September 2021 Q3 2024 (8) $ 3,900,000 $ 3,900,000 $ - $ 3,900,000 $ - 4.85% N/A Subtotal 3,900,000 3,900,000 - 3,900,000 - Total Commitments $ 645,657,972 $ 428,319,586 $ 265,750,851 $ 146,764,235 $ 15,804,500 (1) Projected fundings by year are based on current estimates and the actual funding schedule may differ materially due to, but not limited to, the pace of construction, adverse weather conditions, delays in governmental approvals or permits, the availability of materials and contractors, and labor disputes.
Biggest changeThe following table summarizes our outstanding investment commitments as of December 31, 2023: 63 Projected Funding by Year (1) Property Name Commitment Date Asset Maturity Date Total Initial Commitment Remaining Commitment as of December 31, 2023 2024 2025 Interest Rate (2) Related Debt Financing (3) Mortgage Revenue Bonds Meadow Valley December 2021 December 2029 $ 44,000,000 $ 23,245,000 $ 17,400,000 $ 5,845,000 6.25% Variable TOB Residency at the Entrepreneur- Series J-3 April 2022 March 2040 26,080,000 13,780,000 13,780,000 - 6.00% Variable TOB Residency at the Entrepreneur- Series J-4 April 2022 March 2040 16,420,000 16,420,000 16,420,000 - SOFR + 3.60% (4) Variable TOB Residency at the Entrepreneur- Series J-5 February 2023 April 2025 (5) 5,000,000 4,000,000 3,300,000 700,000 SOFR + 3.60% Variable TOB (6) Residency at Empire - Series BB-3 December 2022 December 2040 14,000,000 8,945,000 8,945,000 - 6.45% (7) Variable TOB Residency at Empire - Series BB-4 December 2022 December 2040 47,000,000 47,000,000 29,755,000 17,245,000 6.45% (8) (9) The Safford October 2023 October 2026 (5) 43,000,000 35,439,966 35,439,966 - 7.59% Variable TOB Subtotal 195,500,000 148,829,966 125,039,966 23,790,000 Taxable Mortgage Revenue Bonds Residency at the Mayer Series A-T October 2021 October 2024 $ 12,500,000 $ 1,000,000 $ 1,000,000 $ - SOFR + 3.70% Variable TOB Residency at the Entrepreneur Series J-T April 2022 April 2025 (5) 8,000,000 7,000,000 - 7,000,000 SOFR + 3.65% Variable TOB (6) Residency at Empire - Series BB-T December 2022 December 2025 (5) 9,404,500 8,404,500 - 8,404,500 7.45% Variable TOB (6) Village at Hanford Square - Series H-T May 2023 May 2030 10,400,000 9,400,000 9,400,000 - 7.25% Variable TOB (6) 40rty on Colony - Series P-T June 2023 June 2030 5,950,000 4,950,000 4,395,000 555,000 7.45% Variable TOB (6) Subtotal 46,254,500 30,754,500 14,795,000 15,959,500 Governmental Issuer Loans Poppy Grove I September 2022 April 2025 (5) $ 35,688,328 $ 15,842,328 $ 15,842,328 $ - 6.78% Variable TOB Poppy Grove II September 2022 April 2025 (5) 22,250,000 12,708,700 12,708,700 - 6.78% Variable TOB Poppy Grove III September 2022 April 2025 (5) 39,119,507 22,569,507 22,569,507 - 6.78% Variable TOB Subtotal 97,057,835 51,120,535 51,120,535 - Taxable Governmental Issuer Loans Poppy Grove I September 2022 April 2025 (5) $ 21,157,672 $ 20,157,672 $ 20,157,672 $ - 6.78% Variable TOB Poppy Grove II September 2022 April 2025 (5) 10,941,300 9,941,300 9,941,300 - 6.78% Variable TOB Poppy Grove III September 2022 April 2025 (5) 24,480,493 23,480,493 19,980,493 3,500,000 6.78% Variable TOB Subtotal 56,579,465 53,579,465 50,079,465 3,500,000 Property Loans Osprey Village July 2021 August 2024 (5) $ 25,500,000 $ 10,501,704 $ 10,501,704 $ - SOFR + 3.07% Variable TOB Willow Place Apartments September 2021 October 2024 (5) 21,351,328 2,475,722 2,475,722 - SOFR + 3.30% Variable TOB Sandy Creek Apartments August 2023 September 2026 (5) 7,830,000 5,410,124 5,410,124 - 8.63% (10) Variable TOB (6) Willow Place Apartments Supplemental November 2023 October 2024 (5) 1,838,254 1,499,254 1,499,254 - SOFR + 3.45% (9) Subtotal 56,519,582 19,886,804 19,886,804 - Equity Investments Vantage at San Marcos (11), (12) November 2020 N/A $ 9,914,529 $ 8,943,914 $ 8,943,914 $ - N/A N/A Vantage at Loveland (13) April 2021 N/A 18,215,000 1,065,061 1,065,061 - N/A N/A Freestone Greeley (12) October 2022 N/A 16,035,710 11,137,993 11,137,993 - N/A N/A The Jessam at Hays Farm July 2023 N/A 16,532,636 9,153,867 9,153,867 - N/A N/A Freestone Greenville (12) December 2023 N/A 19,934,456 14,597,244 14,597,244 - N/A N/A Freestone Ladera (12) December 2023 N/A 17,097,624 13,449,494 13,449,494 - N/A N/A Subtotal 97,729,955 58,347,573 58,347,573 - Bond Purchase Commitments Anaheim & Walnut September 2021 Q3 2024 (14) $ 3,900,000 $ 3,900,000 $ 3,900,000 $ - 4.85% N/A Subtotal 3,900,000 3,900,000 3,900,000 - Total Commitments $ 553,541,337 $ 366,418,843 $ 323,169,343 $ 43,249,500 (1) Projected fundings by year are based on current estimates and the actual funding schedule may differ materially due to, but not limited to, the pace of construction, adverse weather conditions, delays in governmental approvals or permits, the availability of materials and contractors, and labor disputes.
Executive Summary The Partnership was formed in 1998 for the primary purpose of acquiring a portfolio of mortgage revenue bonds (“MRBs”) that are issued by state and local housing authorities to provide construction and/or permanent financing for affordable multifamily housing, seniors housing and commercial properties.
Executive Summary The Partnership was formed in 1998 for the primary purpose of acquiring a portfolio of mortgage revenue bonds (“MRBs”) that are issued by state and local housing authorities to provide construction and/or permanent financing for affordable multifamily, seniors housing and commercial properties.
(2) Economic occupancy is defined as the net rental income received divided by the maximum amount of rental income to be derived from each property. This statistic is reflective of rental concessions, delinquent rents and non-revenue units such as model units and employee units.
(2) Economic occupancy is defined as the net rental income received divided by the maximum amount of rental income to be derived from each property. This statistic is reflective of rental concessions, delinquent rents and non-revenue units such as model units and employee units.
In addition, we will consider the issuance of additional BUCs, Series A-1 Preferred Units, Series B Preferred Units, or other series of limited partnership interests in the Partnership based on needs and opportunities for executing our strategy.
In addition, we will consider the issuance of additional BUCs, Series A-1 Preferred Units, Series B Preferred Units, or other series of limited partnership interests in the Partnership based on needs and opportunities for executing our strategy.
In the case of forbearance or default on an underlying investment asset in a term TOB or TOB trust financing, we may be required to fund shortfalls in principal and interest payable to the senior securities, repurchase a portion of the outstanding securities, or repurchase the underlying investment asset and seek alternative financing.
In the case of forbearance or default on an underlying investment asset in a term TOB or TOB trust financing, we may be required to fund shortfalls in principal and interest payable to the senior securities, repurchase a portion of the outstanding senior securities, or repurchase the underlying investment asset and seek alternative financing.
To calculate CAD, the Partnership begins with net income as computed in accordance with GAAP and adjusts for non-cash expenses or income consisting of depreciation expense, amortization expense related to deferred financing costs, amortization of premiums and discounts, fair value adjustments to derivative instruments, provisions for credit and loan losses, impairments on MRBs, GILs, real estate assets and property loans, deferred income tax expense (benefit) and restricted unit compensation expense.
To calculate CAD, the Partnership begins with net income as computed in accordance with GAAP and adjusts for non-cash expenses or income consisting of depreciation expense, 58 amortization expense related to deferred financing costs, amortization of premiums and discounts, fair value adjustments to derivative instruments, provisions for credit and loan losses, impairments on MRBs, GILs, real estate assets and property loans, deferred income tax expense (benefit), and restricted unit compensation expense.
Our short-term liquidity requirements over the next 12 months will be primarily operational expenses; investment commitments, net of leverage secured by the investment assets; debt service (principal and interest payments) related to our debt financings; repayments of our secured lines of credit balances; the potential exercise of redemption rights by the holders of the Series A Preferred Units; and distribution payments to Unitholders.
Our short-term liquidity requirements over the next 12 months will be primarily operational expenses, investment commitments (net of leverage secured by the investment assets); debt service (principal and interest payments) related to our debt financings; repayments of our secured lines of credit balances; the exercise of redemption rights by the holders of the Series A Preferred Units; and distribution payments to Unitholders.
Potential Redemptions of Series A Preferred Units Upon the sixth anniversary of the closing of the sale of Series A Preferred Units to a subscriber, and upon each anniversary thereafter, each holder of Series A Preferred Units has the right to redeem, in whole or in part, the Series A Preferred Units held by such holder at a per unit redemption price equal to $10.00 per unit plus an amount equal to all declared and unpaid distributions through the date of the redemption.
Redemptions of Series A Preferred Units Upon the sixth anniversary of the closing of the sale of Series A Preferred Units to a subscriber, and upon each anniversary thereafter, each holder of Series A Preferred Units has the right to redeem, in whole or in part, the Series A Preferred Units held by such holder at a per unit redemption price equal to $10.00 per unit plus an amount equal to all declared and unpaid distributions through the date of the redemption.
Liquidity and Capital Resources We continually evaluate our potential sources and uses of liquidity, including current and potential future developments related to market interest rates and the general economic and geopolitical environment. The information below is based on our current 57 expectations and projections about future events and financial trends, which could materially differ from actual results.
Liquidity and Capital Resources We continually evaluate our potential sources and uses of liquidity, including current and potential future developments related to market interest rates and the general economic and geopolitical environment. The information below is based on our current expectations and projections about future events and financial trends, which could materially differ from actual results.
We also invest in governmental issuer loans (“GILs”), which are similar to MRBs, to provide construction financing for affordable multifamily housing properties. We expect and believe the interest received on these MRBs and GILs is excludable from gross income for federal income tax purposes.
We also invest in governmental issuer loans (“GILs”), which are similar to MRBs, to provide construction financing for affordable multifamily and seniors housing properties. We expect and believe the interest received on these MRBs and GILs is excludable from gross income for federal income tax purposes.
If the Partnership does not expect to sell an other-than-temporarily impaired MRB, only the portion of the other-than-temporary impairment related to credit losses is recognized through earnings as a provision for credit loss, with the remainder recognized as a component of other comprehensive income (loss).
If the Partnership does not expect to sell an other-than-temporarily impaired MRB, only the portion of the impairment related to credit losses is recognized through earnings as a provision for credit loss, with the remainder recognized as a component of other comprehensive income.
We consider the following to be our critical accounting policies and estimates because they involve our judgments, assumptions and estimates that significantly affect the Partnership’s consolidated financial statements. If these estimates differ significantly from actual results, the impact on the Partnership’s consolidated financial statements may be material.
We consider the following to be our critical accounting estimates because they involve our judgments, assumptions and estimates that significantly affect the Partnership’s consolidated financial statements. If these estimates differ significantly from actual results, the impact on the Partnership’s consolidated financial statements may be material.
Some state-specific QAPs have minimum energy efficiency standards that must be met, such as use of low water need landscaping, Energy Star appliances and hot water heaters, and GREENGUARD Gold certified insulation.
Some state-specific QAPs have minimum energy efficiency standards that must be met, such as the use of low water need landscaping, Energy Star appliances and hot water heaters, and GREENGUARD Gold certified insulation.
Those constraints are dependent upon several factors, including the assets being leveraged, the tenor of the leverage program, whether the financing is subject to mark-to-market with collateral calls, and the liquidity and marketability of the financed collateral.
Those constraints are dependent upon several factors, including the assets being leveraged, the tenor of the leverage program, whether the financing is subject to mark-to-market collateral calls, and the liquidity and marketability of the financed collateral.
Recent volatility in market interest rates, recent inflation and the potential for an economic recession may negatively impact the potential prices we could realize upon the disposition of our various investment assets.
Recent volatility in market interest rates, recent inflation and the potential for an economic recession may negatively impact the potential prices we could realize upon the disposition of our various assets.
The following table summarizes the number of meetings and attendance during 2022: Number of Meetings Attendance Percentage Board of Managers 4 100% Audit Committee 4 100% Affordable Multifamily MRB Investments Segment The Partnership’s primary purpose is to acquire and hold as investments a portfolio of MRBs which have been issued to provide construction and/or permanent financing for residential properties and commercial properties in their market area.
The following table summarizes the number of meetings and attendance during 2023: Number of Meetings Attendance Percentage Board of Managers 4 100% Audit Committee 4 100% Affordable Multifamily MRB Investments Segment The Partnership’s primary purpose is to acquire and hold as investments a portfolio of MRBs which have been issued to provide construction and/or permanent financing for residential properties and commercial properties in their market area.
Receipt of cash from our investments in MRBs, taxable MRBs, and JV Equity Investments is primarily dependent upon the generation of net cash flows at multifamily properties that underlie these investments.
Receipt of cash from our investments in MRBs, taxable MRBs, and JV Equity Investments is dependent upon the generation of net cash flows at multifamily properties that underlie these investments.
Operating Cash Flows from Investments Cash flows from operations are primarily comprised of regular principal and interest payments received on our investment assets that provide consistent cash receipts throughout the year. All MRBs, taxable MRBs, GILs, taxable GILs and property loans are current on contractual debt service payments as of December 31, 2022, except for the Provision Center 2014-1 MRB.
Operating Cash Flows from Investments Cash flows from operations are primarily comprised of regular principal and interest payments received on our investment assets that provide consistent cash receipts throughout the year. All MRBs, taxable MRBs, GILs, taxable GILs and property loans are current on contractual debt service payments as of December 31, 2023, except for the Provision Center 2014-1 MRB.
Though original development budgets were sized to incorporate potential interest rate increases, the pace of recent interest rate increases has caused actual interest costs during construction to exceed original projections.
Though original development budgets were sized to incorporate potential interest rate increases, the pace of recent interest rate increases has caused actual interest costs during construction to exceed original budgets.
There is no generally accepted methodology for computing CAD, and the Partnership’s computation of CAD may not be comparable to CAD reported by 56 other companies.
There is no generally accepted methodology for computing CAD, and the Partnership’s computation of CAD may not be comparable to CAD reported by other companies.
In December 2022, the Partnership’s Registration Statement on Form S-3 (“Registration Statement”) was declared effective by the SEC under which the Partnership may, from time to time, offer and sell BUCs, Preferred Units, or debt securities, in one or more offerings, with a maximum aggregate offering price of $300.0 million.
In December 2022, the Partnership’s Registration Statement on Form S-3 (the “Shelf Registration Statement”) was declared effective by the SEC under which the Partnership may, from time to time, offer and sell BUCs, Preferred Units, or debt securities, in one or more offerings, with a maximum aggregate offering price of $300.0 million.
We are currently party to a Capital on Demand TM Sales Agreement to offer and sell, from time to time at market prices on the date of sale, BUCs up to an aggregate offering price of $30 million via an “at the market offering.” As of December 31, 2022, we have not sold any BUCs under this program.
We are currently party to a Capital on Demand TM Sales Agreement to offer and sell, from time to time at market prices on the date of sale, BUCs up to an aggregate offering price of $30 million via an “at the market offering.” As of December 31, 2023, we have not sold any BUCs under this program.
(2) The variable index interest rate components are typically subject to floors that range from 0% to 0.85%. (3) We have securitized the indicated assets in TOB financing facilities that allow for additional principal proceeds as the remaining investment commitments are funded by us. See Note 15 for further details on debt financing.
(2) The variable index interest rate components are typically subject to floors that range from 0% to 0.85%. (3) We have securitized the indicated assets in TOB financing facilities that allow for additional principal proceeds as the remaining investment commitments are funded by us. See Note 16 for further details on debt financing.
(3) The Partnership committed to provide total funding of MRBs up to $79.0 million and a taxable MRB up to $9.4 million during the construction and lease-up of the property on a draw-down basis. The taxable MRB has a maturity date of 12/1/2025 with an option to extend the maturity six months if stabilization has not occurred.
(2) The Partnership committed to provide total funding of MRBs up to $79.0 million and a taxable MRB up to $9.4 million during the construction and lease-up of the property on a draw-down basis. The taxable MRB has a maturity date of 12/1/2025 with an option to extend the maturity six months if stabilization has not occurred.
We separately report our consolidation and elimination information because we do not allocate certain items to the segments. All “General and administrative expenses” on the consolidated statements of operations are reported within the Affordable Multifamily MRB Investments segment. See Notes 2 and 24 to the Partnership’s consolidated financial statements for additional details.
We separately report our consolidation and elimination information because we do not allocate certain items to the segments. All “General and administrative expenses” on the consolidated statements of operations are reported within the Affordable Multifamily MRB Investments segment. See Notes 2 and 25 to the Partnership’s consolidated financial statements for additional details.
Our MRB portfolio is marked at a premium to cost, adjusted for paydowns, primarily due to higher stated interest rates when compared to current market interest rates for similar investments. We may consider selling certain MRB investments in exchange for cash at prices that approximate our currently reported fair value.
Our MRB portfolio is marked at a premium to cost, adjusted for paydowns, primarily due to higher stated interest rates when compared to current market interest rates for investments with similar terms. We may consider selling certain MRB investments in exchange for cash at prices that approximate our currently reported fair value.
Debt securities issued under the Registration Statement may be senior or subordinate obligations of the Partnership. The Registration Statement will expire in December 2025.
Debt securities issued under the Shelf Registration Statement may be senior or subordinate obligations of the Partnership. The Shelf Registration Statement will expire in December 2025.
The Greens Hold Co sold its ownership interest in The 50/50 MF Property to an unrelated non-profit organization in December 2022 and deferred a gain on sale of approximately $6.6 million. There was minimal taxable income for the Greens Hold Co for the years ended December 31, 2022 and 2021.
The Greens Hold Co sold its ownership interest in The 50/50 MF Property to an unrelated non-profit organization in December 2022 and deferred a gain on sale of approximately $6.6 million. There was minimal taxable income for the Greens Hold Co for the years ended December 31, 2023 and 2022.
The Acquisition LOC contains a covenant, among others, that our senior debt will not exceed a specified percentage of the market value of our assets to be consistent with the Leverage Ratio (as defined by the Partnership). We were in compliance with all covenants as of December 31, 2022.
The Acquisition LOC contains a covenant, among others, that our senior debt will not exceed a specified percentage of the market value of our assets to be consistent with the Leverage Ratio (as defined by the Partnership). We were in compliance with all covenants as of December 31, 2023.
The senior securities rate on TOB financings structured as taxable to the senior securities holders are typically correlated to taxable short-term securities indices, such as SOFR. We have hedged a portion of our overall exposure to changes in market interest rates on our variable-rate debt financings through five interest rate swaps.
The senior securities rate on TOB financings structured as taxable to the senior securities holders are typically correlated to taxable short-term securities indices, such as SOFR. We have hedged a portion of our overall exposure to changes in market interest rates on our variable rate debt financings through various interest rate swaps.
Our policy is designed to meet the requirements and standards of the Sarbanes Oxley Act of 2022 and the Securities and Exchange Act of 1934. The Board of Managers of Greystone Manager brings a diverse set of skills and experiences across industries in the public, private and not-for-profit sectors.
Our policy is designed to meet the requirements and standards of the Sarbanes Oxley Act of 2002 and the Securities and Exchange Act of 1934. The Board of Managers of Greystone Manager brings a diverse set of skills and experiences across industries in the public, private and not-for-profit sectors.
Of the 14 employees of Greystone Manager responsible for the Partnership’s operations, three are women and one employee identifies as ethnically diverse. Corporate Governance Greystone Manager, as the general partner of the Partnership’s general partner, is committed to corporate governance that aligns with the interests of our Unitholders and stakeholders.
Of the 16 employees of Greystone Manager responsible for the Partnership’s operations, three are women and one employee identifies as ethnically diverse. Corporate Governance Greystone Manager, as the general partner of the Partnership’s general partner, is committed to corporate governance that aligns with the interests of our Unitholders and stakeholders.
The interest rate paid on our variable debt financings are generally determined by the senior trust certificate remarketing agent as the rate necessary to remarket any senior trust securities tendered by holders thereof for remarketing that week at a price of par.
The interest rate paid on our variable rate debt financings are generally determined by the senior securities remarketing agent as the rate necessary to remarket any senior securities tendered by holders thereof for remarketing that week at a price of par.
The Partnership’s operations are primarily managed by 14 employees of Greystone Manager, so we have a relatively modest environmental impact and have adequate facilities to grow our employee base without acquiring additional physical space.
The Partnership’s operations are primarily managed by 16 employees of Greystone Manager, so we have a relatively modest environmental impact and have adequate facilities to grow our employee base without acquiring additional physical space.
Discussion of Income Tax Expense for the Year Ended December 31, 2022 Compared to the Year Ended December 31, 2021 A wholly owned subsidiary of the Partnership, the Greens Hold Co, is a corporation subject to federal and state income tax. The Greens Hold Co owns certain property loans.
Discussion of Income Tax Expense for the Year Ended December 31, 2023 Compared to the Year Ended December 31, 2022 A wholly owned subsidiary of the Partnership, the Greens Hold Co, is a corporation subject to federal and state income tax. The Greens Hold Co owns certain property loans.
As a result, we do not report the assets, liabilities and results of operations of these properties on a consolidated basis. As of December 31, 2022, these residential properties have not met the stabilization criteria (see footnote 3 below the table).
As a result, we do not report the assets, liabilities and results of operations of these properties on a consolidated basis. As of December 31, 2023, these residential properties have not met the stabilization criteria (see footnote 3 below the table).
Investment receipts, net of interest expense on related debt financings and lines of credit, are available for our general use. We also receive distributions from JV Equity Investments if, and when, cash is available for distribution.
Investment receipts, net of interest expense on related debt financing and lines of credit, are available for our general use. We also receive distributions from JV Equity Investments if, and when, cash is available for distribution.
These investments may be eligible for regulatory credit under the Community Reinvestment Act of 1977 ("CRA") and available for allocation to holders of our Preferred Units (see Note 19 to Partnership's consolidated financial statements).
These investments may be eligible for regulatory credit under the Community Reinvestment Act of 1977 ("CRA") and available for allocation to holders of our Preferred Units (see Note 20 to Partnership's consolidated financial statements).
We believe the implementation and maintenance of such policies and practices benefit the employees that serve the Partnership, support long-term performance for our Unitholders, and have a positive impact on society and the environment. 40 Environmental Responsibility Achieving environmental and sustainability goals in connection with our affordable housing investment activity is important to us.
We believe the implementation and maintenance of such policies and practices benefit the employees that serve the Partnership, support long-term performance for our Unitholders, and have a positive impact on society and the environment. Environmental Responsibility Achieving positive environmental and sustainability impacts in connection with our affordable housing investment activity is important to us.
Operational Matters The multifamily properties securing our MRBs were all current on contractual debt service payments on our MRBs and we have received no requests for forbearance of contractual debt service payments as of December 31, 2022.
Operational Matters The multifamily properties securing our MRBs were all current on contractual debt service payments on our MRBs and we have received no requests for forbearance of contractual debt service payments as of December 31, 2023.
Investments in Mortgage Revenue Bonds The fair value of the Partnership’s investments in MRBs as of December 31, 2022 and 2021, is based upon prices obtained from third-party pricing services, which are estimates of market prices. There is no active trading market for these securities, and price quotes 67 for the securities are not available.
Fair Value of Mortgage Revenue Bonds The fair value of the Partnership’s investments in MRBs as of December 31, 2023 and 2022, is based upon prices obtained from third-party pricing services, which are estimates of market prices. There is no active trading market for these securities, and price quotes for the securities are not available.
These properties have met the stabilization criteria (see footnote 3 below the table) as of December 31, 2022. Debt service on our MRBs for the non-consolidated stabilized properties was current as of December 31, 2022.
These properties have met the stabilization criteria (see footnote 3 below the table) as of December 31, 2023. Debt service on our MRBs for the non-consolidated stabilized properties was current as of December 31, 2023.
Advances on the Acquisition LOC are due on the 270th day following the advance date but may be extended for up to an additional 270 days by making certain payments.
Advances on the Acquisition LOC are due on the 270 th day following the advance date but may be extended for up to an additional 270 days by making certain payments.
All the members of the Audit Committee of Greystone Manager are independent under the applicable SEC and NYSE independence requirements, two of whom qualify as “audit committee financial experts.” Of the six Managers of Greystone Manager, one Manager is female. The Greystone Manager Board of Managers is highly engaged in the governance and operations of the Partnership.
All the members of the Audit Committee of Greystone Manager are independent under the applicable SEC and NYSE independence requirements, two of whom qualify as “audit committee financial experts.” Of the seven Managers of Greystone Manager, one Manager is female. 42 The Greystone Manager Board of Managers is highly engaged in the governance and operations of the Partnership.
The narrative discussion that follows provides a brief operating analysis of each investment asset class as of and for the years ended December 31, 2022 and 2021.
The narrative discussion that follows provides a brief operating analysis of each investment asset class as of and for the years ended December 31, 2023 and 2022.
As such, the reported amount of variable debt financing in the table above exceeds the stated notional amount of the SOFR-indexed interest rate swaps as of December 31, 2022.
As such, the reported amount of variable debt financing in the table above exceeds the stated notional amount of the SOFR-indexed interest rate swaps as of December 31, 2023.
The underlying properties are subject to risks usually associated with direct investments in multifamily real estate, which include (but are not limited to) reduced occupancy, tenant defaults, falling rental rates, and increasing operating expenses.
These underlying properties are subject to risks usually 60 associated with direct investments in multifamily real estate, which include (but are not limited to) reduced occupancy, tenant defaults, falling rental rates, and increasing operating expenses.
The amounts presented below were obtained from records provided by the property owners and their related property management service providers. 50 Number of Units as of December 31, Physical Occupancy (1) as of December 31, Economic Occupancy (2) for the years ended December 31, Property Name State 2022 2022 2021 2022 2021 MRB Multifamily Properties-Stabilized (3) CCBA Senior Garden Apartments (4) CA 45 100 % n/a 95 % n/a Courtyard CA 108 100 % 100 % 96 % 92 % Glenview Apartments CA 88 97 % 97 % 86 % 95 % Harden Ranch CA 100 99 % 96 % 96 % 96 % Harmony Court Bakersfield CA 96 96 % 96 % 90 % 91 % Harmony Terrace CA 136 95 % 99 % 132 % 118 % Las Palmas II CA 81 99 % 100 % 98 % 98 % Lutheran Gardens CA 76 91 % 96 % 90 % 98 % Montclair Apartments CA 80 98 % 95 % 93 % 94 % Montecito at Williams Ranch Apartments CA 132 90 % 98 % 101 % 106 % Montevista CA 82 93 % 95 % 90 % 104 % San Vicente CA 50 98 % 98 % 88 % 95 % Santa Fe Apartments CA 89 93 % 98 % 91 % 95 % Seasons at Simi Valley CA 69 97 % 100 % 118 % 109 % Seasons Lakewood CA 85 100 % 99 % 102 % 97 % Seasons San Juan Capistrano CA 112 96 % 95 % 100 % 96 % Solano Vista CA 96 99 % 98 % 86 % 102 % Summerhill CA 128 98 % 98 % 90 % 91 % Sycamore Walk CA 112 96 % 100 % 84 % 90 % The Village at Madera CA 75 96 % 99 % 98 % 102 % Tyler Park Townhomes CA 88 100 % 99 % 98 % 97 % Vineyard Gardens CA 62 100 % 100 % 100 % 97 % Westside Village Market CA 81 99 % 96 % 91 % 93 % Brookstone IL 168 97 % 97 % 100 % 95 % Copper Gate Apartments IN 129 98 % 98 % 101 % 95 % Renaissance LA 208 95 % 95 % 91 % 91 % Live 929 Apartments MD 575 91 % 95 % 78 % 75 % Greens Property NC 168 99 % 99 % 78 % 93 % Silver Moon NM 151 94 % 97 % 96 % 93 % Village at Avalon NM 240 96 % 97 % 96 % 97 % Columbia Gardens SC 188 90 % 91 % 99 % 99 % Companion at Thornhill Apartments SC 180 100 % 100 % 81 % 88 % The Palms at Premier Park Apartments SC 240 98 % 100 % 88 % 92 % Village at River's Edge SC 124 95 % 98 % 95 % 102 % Willow Run SC 200 89 % 92 % 100 % 99 % Arbors at Hickory Ridge (5) TN 348 n/a n/a n/a n/a Avistar at Copperfield TX 192 100 % 94 % 86 % 84 % Avistar at the Crest TX 200 98 % 99 % 86 % 77 % Avistar at the Oaks TX 156 97 % 97 % 90 % 88 % Avistar at the Parkway TX 236 97 % 95 % 84 % 85 % Avistar at Wilcrest TX 88 90 % 89 % 77 % 72 % Avistar at Wood Hollow TX 409 97 % 97 % 88 % 86 % Avistar in 09 TX 133 98 % 100 % 93 % 90 % Avistar on the Boulevard TX 344 93 % 97 % 84 % 82 % Avistar on the Hills TX 129 96 % 98 % 84 % 87 % Bruton Apartments TX 264 84 % 85 % 63 % 68 % Concord at Gulfgate TX 288 90 % 97 % 85 % 83 % Concord at Little York TX 276 90 % 94 % 75 % 83 % Concord at Williamcrest TX 288 92 % 96 % 82 % 88 % Crossing at 1415 TX 112 96 % 98 % 87 % 88 % Decatur Angle TX 302 86 % 81 % 68 % 70 % Esperanza at Palo Alto TX 322 86 % 93 % 75 % 87 % Heights at 515 TX 96 93 % 97 % 89 % 88 % Heritage Square TX 204 97 % 96 % 84 % 77 % Oaks at Georgetown TX 192 97 % 96 % 91 % 94 % Runnymede TX 252 99 % 99 % 96 % 95 % Southpark TX 192 96 % 98 % 90 % 95 % 15 West Apartments WA 120 99 % 97 % 99 % 98 % 9,785 94.5 % 95.8 % 87.6 % 88.8 % (1) Physical occupancy is defined as the total number of units occupied divided by total units at the date of measurement.
The amounts presented below were obtained from records provided by the property owners and their related property management service providers. 51 Number of Units as of December 31, Physical Occupancy (1) as of December 31, Economic Occupancy (2) for the year ended December 31, Property Name State 2023 2023 2022 2023 2022 MRB Multifamily Properties-Stabilized (3) CCBA Senior Garden Apartments CA 45 91 % 100 % 94 % 95 % Courtyard CA 108 98 % 100 % 98 % 96 % Glenview Apartments CA 88 92 % 97 % 84 % 86 % Harden Ranch CA 100 100 % 99 % 98 % 96 % Harmony Court Bakersfield CA 96 95 % 96 % 93 % 90 % Harmony Terrace CA 136 99 % 95 % 136 % 132 % Las Palmas II CA 81 100 % 99 % 98 % 98 % Lutheran Gardens CA 76 97 % 91 % 94 % 90 % Montclair Apartments CA 80 100 % 98 % 91 % 93 % Montecito at Williams Ranch Apartments CA 132 98 % 90 % 104 % 101 % Montevista CA 82 94 % 93 % 97 % 90 % San Vicente CA 50 100 % 98 % 90 % 88 % Santa Fe Apartments CA 89 100 % 93 % 96 % 91 % Seasons at Simi Valley CA 69 97 % 97 % 121 % 118 % Seasons Lakewood CA 85 99 % 100 % 109 % 102 % Seasons San Juan Capistrano CA 112 97 % 96 % 102 % 100 % Solano Vista CA 96 100 % 99 % 89 % 86 % Summerhill CA 128 93 % 98 % 93 % 90 % Sycamore Walk CA 112 95 % 96 % 93 % 84 % The Village at Madera CA 75 99 % 96 % 104 % 98 % Tyler Park Townhomes CA 88 99 % 100 % 98 % 98 % Vineyard Gardens CA 62 100 % 100 % 103 % 100 % Westside Village Market CA 81 98 % 99 % 95 % 91 % Ocotillo Springs CA 75 100 % 100 % 99 % 93 % Brookstone IL 168 98 % 97 % 100 % 100 % Copper Gate Apartments IN 129 96 % 98 % 97 % 101 % Renaissance LA 208 89 % 95 % 90 % 91 % Live 929 Apartments MD 575 67 % 91 % 78 % 78 % Jackson Manor Apartments MS 60 98 % 95 % 97 % 96 % Silver Moon NM 151 95 % 94 % 95 % 96 % Village at Avalon NM 240 99 % 96 % 98 % 96 % Columbia Gardens SC 188 89 % 90 % 100 % 99 % Companion at Thornhill Apartments SC 180 100 % 100 % 81 % 81 % The Palms at Premier Park Apartments SC 240 97 % 98 % 86 % 88 % Village at River's Edge SC 124 95 % 95 % 92 % 95 % Willow Run SC 200 85 % 89 % 102 % 100 % Arbors at Hickory Ridge (4) TN 348 n/a n/a n/a n/a Avistar at Copperfield TX 192 95 % 100 % 89 % 86 % Avistar at the Crest TX 200 96 % 98 % 91 % 86 % Avistar at the Oaks TX 156 97 % 97 % 90 % 90 % Avistar at the Parkway TX 236 84 % 97 % 80 % 84 % Avistar at Wilcrest TX 88 94 % 90 % 83 % 77 % Avistar at Wood Hollow TX 409 92 % 97 % 88 % 88 % Avistar in 09 TX 133 99 % 98 % 94 % 93 % Avistar on the Boulevard TX 344 90 % 93 % 82 % 84 % Avistar on the Hills TX 129 96 % 96 % 87 % 84 % Bruton Apartments TX 264 81 % 84 % 49 % 63 % Concord at Gulfgate TX 288 93 % 90 % 80 % 85 % Concord at Little York TX 276 88 % 90 % 76 % 75 % Concord at Williamcrest TX 288 95 % 92 % 86 % 82 % Crossing at 1415 TX 112 95 % 96 % 85 % 87 % Decatur Angle TX 302 88 % 86 % 69 % 68 % Esperanza at Palo Alto TX 322 88 % 86 % 74 % 75 % Heights at 515 TX 96 92 % 93 % 86 % 89 % Heritage Square TX 204 95 % 97 % 87 % 84 % Oaks at Georgetown TX 192 94 % 97 % 91 % 91 % Runnymede TX 252 99 % 99 % 91 % 96 % Southpark TX 192 90 % 96 % 82 % 90 % 15 West Apartments WA 120 100 % 99 % 98 % 99 % 9,752 92.2 % 94.5 % 87.7 % 87.8 % (1) Physical occupancy is defined as the total number of units occupied divided by total units at the date of measurement.
General and Administrative Expenses We use cash to pay general and administrative expenses of our operations and real estate operating expenses of our MF Properties. For additional details, see Item 1A, “Risk Factors” in this report, and the section captioned “Cash flows from operating activities” in the consolidated statements of cash flows set forth in Item 8 of this Report.
General and Administrative Expenses We use cash to pay general and administrative expenses of our operations. For additional details, see Item 1A, “Risk Factors” in this report, and the section captioned “Cash flows from operating activities” in the consolidated statements of cash flows set forth in Item 8 of this Report.
Each of the properties securing our MRB and GIL investments is required to maintain a minimum percentage of units set-aside for a combination of extremely low-income (30% of area median income or “AMI”), very low-income (50% of AMI), and low-income (80% of AMI) tenants in accordance with IRC guidelines, and the owners of the properties often agree to exceed the minimum IRC requirements.
Each of the properties securing our MRB and GIL investments is required to 41 maintain a minimum percentage of units set-aside for a combination of very low-income (50% or less of area median income or "AMI") and low-income (80% or less of AMI) tenants in accordance with IRC guidelines, and the owners of the properties often agree to exceed the minimum IRC requirements.
The gain on sale of JV Equity Investments for 2022 primarily consisted of the following: • The sale of Vantage at Murfreesboro in March 2022 for a gain of approximately $16.5 million; • The sale of Vantage at Westover Hills in May 2022 for a gain of approximately $12.7 million; and • The sale of Vantage at O'Connor in July 2022 for a gain of approximately $10.6 million.
The gain on sale of JV Equity Investments for the year ended December 31, 2022 primarily consisted of the following: • The sale of Vantage at Murfreesboro in March 2022 for a gain of approximately $16.5 million; • The sale of Vantage at Westover Hills in May 2022 for a gain of approximately $12.7 million; and • The sale of Vantage at O'Connor in July 2022 for a gain of approximately $10.6 million.
If a MRB’s estimated fair value is below amortized cost, and the Partnership has the intent to sell or may be required to sell the MRB prior to the time that its value recovers or until maturity, the Partnership will record an other-than-temporary impairment through earnings equal to the difference between the MRB’s carrying value and its fair value.
If the estimated fair value of an MRB is below amortized cost, and the Partnership has the intent to sell or may be required to sell the MRB prior to the time that its value recovers or until maturity, the Partnership will record an impairment through earnings equal to the difference between the MRB’s carrying value and its fair value.
(4) This amount represents previous impairments recognized as adjustments to CAD in prior periods related to the Cross Creek property loans. Such impairments were realized in the third quarter of 2022 upon the settlement of the outstanding balances.
(3) This amount represents previous impairments recognized as adjustments to CAD in prior periods related to the Cross Creek property loans. Such adjustments were reversed in the third quarter of 2022 upon the settlement of the outstanding balances.
The rent charged to income qualified tenants at MRB or GIL properties is often restricted to a certain percentage of the tenants’ income, making them more affordable. For any newly originated MRBs or GILs associated with a low-income housing tax credit property, restrictions regarding tenant incomes and rents charged to those low-income households are required.
The rent charged to income qualified tenants at MRB or GIL properties is often restricted to a certain percentage of the tenants’ income, making them more affordable. For any new MRB or GIL investments associated with a low-income housing tax credit property, restrictions regarding tenant incomes and rents charged to those low-income households are required.
Sources of Liquidity The Partnership’s principal sources of liquidity consist of: • Unrestricted cash on hand; • Operating cash flows from investments in investment assets; • Net operating cash flows from our MF Property; • Secured lines of credit; • Proceeds from the sale or redemption of assets. • Proceeds from obtaining additional debt; and • Issuances of debt securities, BUCs, Series A-1 Preferred Units, Series B Preferred Units, or other series of limited partnership interests.
Sources of Liquidity The Partnership’s principal sources of liquidity consist of: • Unrestricted cash on hand; • Operating cash flows from investment assets; • Secured lines of credit; • Proceeds from the redemption or sale of assets; • Proceeds from obtaining additional debt; and • Issuances of debt securities, BUCs, Series A-1 Preferred Units, Series B Preferred Units, or other series of limited partnership interests.
Cash Available for Distribution The Partnership believes that Cash Available for Distribution (“CAD”) provides relevant information about the Partnership’s operations and is necessary, along with net income, for understanding its operating results.
Cash Available for Distribution - Non-GAAP Financial Measures The Partnership believes that Cash Available for Distribution (“CAD”) provides relevant information about the Partnership’s operations and is necessary, along with net income, for understanding its operating results.
N Roseville Ramsey MN 55113 Jackson Manor Apartments (6) 6,900,000 5/1/2038 332 Josanna Street Jackson Hinds MS 39202 Greens of Pine Glen 10,315,000 10/1/2047 6201 Pine Glen Trail Durham Durham NC 27713 Silver Moon Apartments 8,500,000 8/1/2055 901 Park Avenue SW Albuquerque Bernalillo NM 87102 Village at Avalon 16,400,000 1/1/2059 915 Park SW Albuquerque Bernalillo NM 87102 Columbia Gardens Apartments 15,000,000 12/1/2050 4000 Plowden Road Columbia Richland SC 29205 Companion at Thornhill Apartments 11,500,000 1/1/2052 930 East Main Street Lexington Lexington SC 29072 The Ivy Apartments 30,500,000 2/1/2030 151 Century Drive Greenville Greenville SC 29607 The Palms at Premier Park 20,152,000 1/1/2050 1155 Clemson Frontage Road Columbia Richland SC 29229 Park at Sondrio Apartments 39,200,000 1/1/2030 3500 Pelham Road Greenville Greenville SC 29615 Park at Vietti Apartments 27,865,000 1/1/2030 1000 Hunt Club Lane Spartanburg Spartanburg SC 29301 Village at River's Edge 10,000,000 6/1/2033 Gibson & Macrae Streets Columbia Richland SC 29203 Willow Run 15,000,000 12/18/2050 511 Alcott Drive Columbia Richland SC 29203 Windsor Shores Apartments 22,350,000 2/1/2030 1000 Windsor Shores Drive Columbia Richland SC 29223 Arbors of Hickory Ridge Apartments 11,581,925 1/1/2049 6296 Lake View Trail Memphis Shelby TN 38115 Angle Apartments 23,000,000 1/1/2054 4250 Old Decatur Rd Fort Worth Tarrant TX 76106 Avistar at Copperfield (Meadow Creek) 14,000,000 5/1/2054 6416 York Meadow Drive Houston Harris TX 77084 Avistar at the Crest Apartments 11,211,961 3/1/2050 12660 Uhr Lane San Antonio Bexar TX 78217 Avistar at the Oaks 8,985,774 8/1/2050 3935 Thousand Oaks Drive San Antonio Bexar TX 78217 Avistar at Wilcrest (Briar Creek) 3,470,000 5/1/2054 1300 South Wilcrest Drive Houston Harris TX 77042 Avistar at Wood Hollow (Oak Hollow) 40,260,000 5/1/2054 7201 Wood Hollow Circle Austin Travis TX 78731 Avistar in 09 Apartments 7,808,622 8/1/2050 6700 North Vandiver Road San Antonio Bexar TX 78209 Avistar on Parkway 13,425,000 5/1/2052 9511 Perrin Beitel Rd San Antonio Bexar TX 78217 Avistar on the Blvd 17,559,976 3/1/2050 5100 USAA Boulevard San Antonio Bexar TX 78240 Avistar on the Hills 5,769,327 8/1/2050 4411 Callaghan Road San Antonio Bexar TX 78228 Crossing at 1415 7,590,000 12/1/2052 1415 Babcock Road San Antonio Bexar TX 78201 Concord at Gulf Gate Apartments 19,185,000 2/1/2032 7120 Village Way Houston Harris TX 77087 Concord at Little York Apartments 13,440,000 2/1/2032 301 W Little York Rd Houston Harris TX 77076 Concord at Williamcrest Apartments 20,820,000 2/1/2032 10965 S Gessner Rd Houston Harris TX 77071 Esperanza at Palo Alto Apartments 19,540,000 7/1/2058 SWC of Loop 410 and Highway 16 South San Antonio Bexar TX 78224 Heights at 515 6,435,000 12/1/2052 515 Exeter Road San Antonio Bexar TX 78209 Heritage Square Apartments 11,185,000 9/1/2051 515 S.
Ardenwood Drive Baton Rouge East Baton Rouge Parish LA 70806 Legacy Commons at Signal Hills 34,620,000 2/1/2024 50 Signal Hills Center West Saint Paul Dakota MN 55118 Jackson Manor Apartments 4,824,474 5/1/2038 332 Josanna Street Jackson Hinds MS 39202 Silver Moon Apartments 8,500,000 8/1/2055 901 Park Avenue SW Albuquerque Bernalillo NM 87102 Village at Avalon 16,400,000 1/1/2059 915 Park SW Albuquerque Bernalillo NM 87102 Columbia Gardens Apartments 15,000,000 12/1/2050 4000 Plowden Road Columbia Richland SC 29205 Companion at Thornhill Apartments 11,500,000 1/1/2052 930 East Main Street Lexington Lexington SC 29072 The Ivy Apartments 30,500,000 2/1/2030 151 Century Drive Greenville Greenville SC 29607 The Palms at Premier Park 20,152,000 1/1/2050 1155 Clemson Frontage Road Columbia Richland SC 29229 Park at Sondrio Apartments 39,200,000 1/1/2030 3500 Pelham Road Greenville Greenville SC 29615 Park at Vietti Apartments 27,865,000 1/1/2030 1000 Hunt Club Lane Spartanburg Spartanburg SC 29301 Village at River's Edge 10,000,000 6/1/2033 Gibson & Macrae Streets Columbia Richland SC 29203 Willow Run 15,000,000 12/18/2050 511 Alcott Drive Columbia Richland SC 29203 Windsor Shores Apartments 22,350,000 2/1/2030 1000 Windsor Shores Drive Columbia Richland SC 29223 Arbors of Hickory Ridge Apartments 11,581,925 1/1/2049 6296 Lake View Trail Memphis Shelby TN 38115 Angle Apartments 21,000,000 1/1/2054 4250 Old Decatur Rd Fort Worth Tarrant TX 76106 Avistar at Copperfield (Meadow Creek) 14,000,000 5/1/2054 6416 York Meadow Drive Houston Harris TX 77084 Avistar at the Crest Apartments 10,211,961 3/1/2050 12660 Uhr Lane San Antonio Bexar TX 78217 Avistar at the Oaks 8,985,774 8/1/2050 3935 Thousand Oaks Drive San Antonio Bexar TX 78217 Avistar at Wilcrest (Briar Creek) 3,470,000 5/1/2054 1300 South Wilcrest Drive Houston Harris TX 77042 Avistar at Wood Hollow (Oak Hollow) 40,260,000 5/1/2054 7201 Wood Hollow Circle Austin Travis TX 78731 Avistar in 09 Apartments 7,808,622 8/1/2050 6700 North Vandiver Road San Antonio Bexar TX 78209 Avistar on Parkway 13,425,000 5/1/2052 9511 Perrin Beitel Rd San Antonio Bexar TX 78217 Avistar on the Blvd 17,559,976 3/1/2050 5100 USAA Boulevard San Antonio Bexar TX 78240 Avistar on the Hills 5,769,327 8/1/2050 4411 Callaghan Road San Antonio Bexar TX 78228 Crossing at 1415 7,590,000 12/1/2052 1415 Babcock Road San Antonio Bexar TX 78201 Concord at Gulf Gate Apartments 9,185,000 2/1/2032 7120 Village Way Houston Harris TX 77087 Concord at Little York Apartments 13,440,000 2/1/2032 301 W Little York Rd Houston Harris TX 77076 Concord at Williamcrest Apartments 19,820,000 2/1/2032 10965 S Gessner Rd Houston Harris TX 77071 Esperanza at Palo Alto Apartments 19,540,000 7/1/2058 SWC of Loop 410 and Highway 16 South San Antonio Bexar TX 78224 Heights at 515 6,435,000 12/1/2052 515 Exeter Road San Antonio Bexar TX 78209 Heritage Square Apartments 11,185,000 9/1/2051 515 S.
We also make noncontrolling equity investments in unconsolidated entities for the construction, stabilization, and ultimate sale of market-rate multifamily properties. We are entitled to distributions if, and when, cash is available for distribution either through operations, a refinance or sale of the property.
We also make noncontrolling equity investments in unconsolidated entities, also known as our JV Equity Investments, for the construction, stabilization, and ultimate sale of market-rate multifamily and seniors housing properties. We are entitled to distributions if, and when, cash is available for distribution either through operations, a refinance or sale of the property.
The following table summarizes the Partnership's current Preferred Unit offerings: Preferred Unit Series Initial Registration Effectiveness Date Expiration Date Unit Offering Price Distribution Rate Optional Redemption Date Units Available to Issue as of December 31, 2022 Units Issued as of December 31, 2022 Series A-1 September 2021 September 2024 $ 10.00 3.00% Sixth anniversary 3,500,000 (1) - Series B September 2021 September 2024 10.00 3.40% Eighth anniversary 10,000,000 (2) - Total 13,500,000 - (1) The Partnership is able to issue Series A-1 Preferred Units so long as the aggregate market capitalization of the BUCs, based on the closing price on the trading day prior to issuance of the Series A-1 Preferred Units, is no less than three times the aggregate book value of all Series A Preferred Units and Series A-1 Preferred Units, inclusive of the amount to be issued.
The following table summarizes the Partnership's current Preferred Unit offerings: Preferred Unit Series Initial Registration Effectiveness Date Expiration Date Unit Offering Price Distribution Rate Optional Redemption Date Units Issued as of December 31, 2023 Remaining Units Available to Issue as of December 31, 2023 Series A-1 September 2021 September 2024 $ 10.00 3.00% Sixth anniversary 1,800,000 1,700,000 (1) Series B September 2021 September 2024 10.00 5.75% Sixth anniversary - 10,000,000 (2) Total 1,800,000 11,700,000 (1) The Partnership is able to issue Series A-1 Preferred Units so long as the aggregate market capitalization of the BUCs, based on the closing price on the trading day prior to issuance of the Series A-1 Preferred Units, is no less than three times the aggregate book value of all Series A Preferred Units and Series A-1 Preferred Units, inclusive of the amount to be issued.
This adjustment represents the 25% of Tier 2 income due to the General Partner. For the year ended December 31, 2022, Tier 2 income allocable to the General Partner consisted of approximately $3.2 million related to the gain on sale of Vantage at Murfreesboro in March 2022.
For the year ended December 31, 2022, Tier 2 income allocable to the General Partner consisted of approximately $3.2 million related to the gain on sale of Vantage at Murfreesboro in March 2022.
Market-Rate Joint Venture Investments Segment The Market-Rate Joint Venture Investments segment consists of our noncontrolling joint venture equity investments in market-rate multifamily properties, also referred to as our investments in unconsolidated entities or JV Equity Investments, and property loans due from market-rate multifamily properties. Our joint venture equity investments are passive in nature.
Market-Rate Joint Venture Investments Segment The Market-Rate Joint Venture Investments segment consists of our noncontrolling joint venture equity investments in market-rate multifamily properties, also referred to as our investments in unconsolidated entities or JV Equity Investments. Our joint venture equity investments are passive in nature.
Upon stabilization of the property, the MRB will be partially repaid and the maximum balance of the MRB after stabilization will not exceed $18.1 million and will have a maturity date of 4/1/2039.
The taxable MRB has a maturity date of 10/1/2024. Upon stabilization of the property, the MRB will be partially repaid and the maximum balance of the MRB after stabilization will not exceed $18.1 million and will have a maturity date of 4/1/2039. 73
Proceeds from the Sale or Redemption of Assets We may, from time to time, sell or redeem our investments in MRBs, GILs, property loans, JV Equity Investments and MF Properties consistent with our strategic plans.
Proceeds from the Redemption or Sale of Assets We may, from time to time, experience redemptions of or execute sales of our investments in MRBs, GILs, property loans, JV Equity Investments and MF Properties consistent with our strategic plans.
El Segundo Boulevard Compton Los Angeles CA 90222 Montclair Apartments 1,630,000 12/1/2031 150 S 19th Ave Lemoore Kings CA 93245 Montecito at Williams Ranch 7,690,000 10/1/2034 1598 Mesquite Dr Salinas Monterey CA 93905 Montevista 6,720,000 7/1/2036 13728 San Pablo Avenue San Pablo Contra Costa CA 94806 Ocotillo Springs (2) 18,090,000 8/1/2037 1615 I St Brawley Imperial CA 92227 Poppy Grove I 8,846,000 4/1/2025 10149 Bruceville Road Elk Grove Sacramento CA 95624 Poppy Grove II 5,541,300 4/1/2025 10149 Bruceville Road Elk Grove Sacramento CA 95624 Poppy Grove III 9,550,000 4/1/2025 10149 Bruceville Road Elk Grove Sacramento CA 95624 Residency at Empire (3) 19,055,000 12/31/2040 2814 W Empire Avenue Burbank Los Angeles CA 91504 Residency at the Entrepreneur (4) 21,400,000 3/31/2040 1657-1661 North Western Avenue Hollywood Los Angeles CA 90027 Residency at the Mayer (5) 27,000,000 4/1/2039 5500 Hollywood Boulevard Hollywood Los Angeles CA 90028 San Vicente Townhomes 495,000 11/1/2033 250 San Vicente Road Soledad Monterey CA 93960 Santa Fe Apartments 265,000 12/1/2031 16576 Sultana St Hesperia San Bernardino CA 92345 Seasons Lakewood Apartments 5,000,000 1/1/2034 21309 Bloomfield Ave Lakewood Los Angeles CA 90715 Seasons San Juan Capistrano Apartments 3,000,000 1/1/2034 31641 Rancho Viejo Rd San Juan Capistrano Orange CA 92675 Seasons At Simi Valley 4,376,000 9/1/2032 1606 Rory Ln Simi Valley Ventura CA 93063 Solano Vista Apartments 2,655,000 1/1/2036 40 Valle Vista Avenue Vallejo Solano CA 94590 Summerhill Family Apartments 3,623,000 12/1/2033 6200 Victor Street Bakersfield Kern CA 93308 Sycamore Walk 632,000 1/1/2033 380 Pacheco Road Bakersfield Kern CA 93307 Tyler Park Townhomes 75,000 1/1/2030 1120 Heidi Drive Greenfield Monterey CA 93927 Village at Madera Apartments 85,000 12/1/2033 501 Monterey St Madera Madera CA 93637 Vineyard Gardens 3,995,000 1/1/2035 2800 E Vineyard Ave Oxnard Ventura CA 93036 Westside Village Apartments 1,970,000 1/1/2030 595 Vera Cruz Way Shafter Kern CA 93263 Centennial Crossings Senior Apartments 57,330,000 9/1/2023 15475 East Fair Place Centennial Arapahoe CO 80016 Osprey Village 40,893,040 8/1/2024 151 N.
El Segundo Boulevard Compton Los Angeles CA 90222 Montclair Apartments 2,530,000 12/1/2031 150 S 19th Ave Lemoore Kings CA 93245 Montecito at Williams Ranch 7,690,000 10/1/2034 1598 Mesquite Dr Salinas Monterey CA 93905 Montevista 720,000 7/1/2036 13728 San Pablo Avenue San Pablo Contra Costa CA 94806 Ocotillo Springs 2,489,096 8/1/2038 1615 I St Brawley Imperial CA 92227 Poppy Grove I 21,846,000 4/1/2025 10149 Bruceville Road Elk Grove Sacramento CA 95624 Poppy Grove II 12,541,300 4/1/2025 10149 Bruceville Road Elk Grove Sacramento CA 95624 Poppy Grove III 19,550,000 4/1/2025 10149 Bruceville Road Elk Grove Sacramento CA 95624 Residency at Empire (2) 26,055,000 12/31/2040 2814 W Empire Avenue Burbank Los Angeles CA 91504 Residency at the Entrepreneur (3) 32,100,000 3/31/2040 1657-1661 North Western Avenue Hollywood Los Angeles CA 90027 Residency at the Mayer (4) 42,000,000 4/1/2039 5500 Hollywood Boulevard Hollywood Los Angeles CA 90028 San Vicente Townhomes 3,495,000 11/1/2033 250 San Vicente Road Soledad Monterey CA 93960 Santa Fe Apartments 1,565,000 12/1/2031 16576 Sultana St Hesperia San Bernardino CA 92345 Seasons Lakewood Apartments 7,350,000 1/1/2034 21309 Bloomfield Ave Lakewood Los Angeles CA 90715 Seasons San Juan Capistrano Apartments 5,300,000 1/1/2034 31641 Rancho Viejo Rd San Juan Capistrano Orange CA 92675 Seasons At Simi Valley 4,376,000 9/1/2032 1606 Rory Ln Simi Valley Ventura CA 93063 Solano Vista Apartments 2,655,000 1/1/2036 40 Valle Vista Avenue Vallejo Solano CA 94590 Summerhill Family Apartments 6,423,000 12/1/2033 6200 Victor Street Bakersfield Kern CA 93308 Sycamore Walk 2,132,000 1/1/2033 380 Pacheco Road Bakersfield Kern CA 93307 Tyler Park Townhomes 2,075,000 1/1/2030 1120 Heidi Drive Greenfield Monterey CA 93927 Village at Madera Apartments 3,085,000 12/1/2033 501 Monterey St Madera Madera CA 93637 Vineyard Gardens 995,000 1/1/2035 2800 E Vineyard Ave Oxnard Ventura CA 93036 Westside Village Apartments 3,970,000 1/1/2030 595 Vera Cruz Way Shafter Kern CA 93263 Osprey Village 60,000,000 8/1/2024 151 N.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations. General In this Management’s Discussion and Analysis, all references to “we,” “us,” and the “Partnership” refer to Greystone Housing Impact Investors LP, its consolidated subsidiaries, and consolidated VIEs for all periods presented. See Note 2 and Note 5 to the Partnership’s consolidated financial statements for further disclosure.
Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations. General In this Management’s Discussion and Analysis, all references to “we,” “us,” and the “Partnership” refer to Greystone Housing Impact Investors LP, its subsidiaries, and consolidated VIEs for all periods presented.
(4) Physical and economic occupancy information is not available for the years ended December 31, 2022 and 2021 as the property is under construction or rehabilitation. (5) Physical and economic occupancy information is not available for the year ended December 31, 2021 as the related investment was under construction or rehabilitation.
(4) Physical and economic occupancy information is not available for the year ended December 31, 2022 as the related investment was under construction or rehabilitation. or was recently acquired. (5) Economic occupancy information is not available for the years ended December 31, 2022 as the related MRB was acquired in December 2022.
We expect to meet these liquidity requirements primarily through refinancing of maturing debt financings with the same or similar lenders; contractual principal and interest payments from investments in MRBs, GILs and property loans; and proceeds from asset sales and redemptions.
We expect to meet these liquidity requirements primarily through refinancing of maturing debt financings with the same or similar lenders; contractual principal and interest payments from our investments; and proceeds from asset redemptions and sales in the normal course of business.
(5) The Partnership committed to provide total funding of an MRB up to $29.5 million and a taxable MRB up to $12.5 million during the acquisition and rehabilitation phase of the property on a draw-down basis. The taxable MRB has a maturity date of 4/1/2024 with an option to extend the maturity six months if stabilization has not occurred.
(3) The Partnership committed to provide total funding of MRBs up to $64.0 million and a taxable MRB up to $8.0 million during the acquisition and rehabilitation phase of the property on a draw-down basis. The taxable MRB has a maturity date of 4/1/2025 with an option to extend the maturity six months if stabilization has not occurred.
As of December 31, 2022, debt service on the Partnership’s MRBs and GILs for the non-consolidated, non-stabilized properties was current. The amounts presented below were obtained from records provided by the property owners and their related property management service providers.
As of December 31, 2023, the properties were current on debt service for the Partnership’s related MRBs, taxable MRBs, GILs, taxable GILs and property loans. The amounts presented below were obtained from records provided by the property owners and their related property management service providers.
We calculate our Leverage Ratio as total outstanding debt divided by total assets using cost adjusted for paydowns for MRBs, GILs, property loans, taxable MRBs and taxable GILs, and initial cost for deferred financing costs and real estate assets. As of December 31, 2022, our overall Leverage Ratio was approximately 73%.
We calculate our Leverage Ratio as total outstanding debt divided by total assets using cost adjusted for paydowns for MRBs, GILs, property loans, taxable MRBs and taxable GILs, and initial cost for deferred financing costs and real estate assets.
Off Balance Sheet Arrangements As of December 31, 2022 and 2021, we held MRB, GIL, taxable MRB, taxable GIL, and certain property loan investments that are secured by affordable multifamily and seniors housing properties and one commercial property, which are owned by entities that are not controlled by us.
As of December 31, 2023, our overall Leverage Ratio was approximately 72%. 68 Off Balance Sheet Arrangements As of December 31, 2023 and 2022, we held MRB, GIL, taxable MRB, taxable GIL, and certain property loan investments that are secured by affordable multifamily and seniors housing properties and one commercial property, which are owned by entities that are not controlled by us.
Changes in fair value due to an increase or decrease in the effective yield do not impact the Partnership’s cash flows. See the Partnership`s Mortgage Revenue Bonds Sensitivity Analysis in Item 7A for further analysis on the impact of hypothetical changes in effective yield on the fair value of our MRBs.
Changes in fair value due to an increase or decrease in the effective yield do not impact the Partnership’s cash flows or reported net income, except in the case of impairment related to credit factors. 69 See the Partnership`s Mortgage Revenue Bonds Sensitivity Analysis in Item 7A for further analysis on the impact of hypothetical changes in effective yield on the fair value of our MRBs.
On December 19, 2022, we announced that the Board of Managers of Greystone Manager, which is the general partner of the General Partner, declared a regular quarterly cash distribution of $0.37 per BUC and a supplemental cash distribution of $0.10 per BUC to unitholders of record on December 30, 2022 and payable on January 31, 2023.
On December 13, 2023, we announced that the Board of Managers of Greystone Manager, which is the general partner of the General Partner, declared a quarterly cash distribution of $0.37 per BUC to unitholders of record on December 29, 2023 and payable on January 31, 2024.
We have also invested in taxable MRBs, GILs, taxable GILs and property loans which are included within this segment. All “General and administrative expenses” on our consolidated statements of operations are reported within this segment.
We have also invested in taxable MRBs, GILs, taxable GILs and property loans which are included within this segment. All “General and administrative expenses” on our consolidated statements of operations are reported within this segment. Our MRBs, taxable MRBs, GILs, taxable GILs and certain property loans are secured by a mortgage or deed of trust.
(2) The average change attributable to rate includes $3.2 million for payments received on property loans that were previously in nonaccrual status during 2022. (3) Interest expense is reported net of income/loss on the Partnership's total return swap agreements.
(2) The average change attributable to rate includes $3.6 million for payments received on property loans that were previously in nonaccrual status during 2022. (3) Interest expense is reported net of realized gains on the Partnership's total return swap agreements that are directly tied to the Secured Notes.
Upon stabilization of the property, the MRBs will be partially repaid and the maximum balance of the MRBs after stabilization will not exceed $35.3 million and will have a maturity date of 12/1/2040. 71 (4) The Partnership committed to provide total funding of MRBs up to $59.0 million and a taxable MRB up to $13.0 million during the acquisition and rehabilitation phase of the property on a draw-down basis.
Upon stabilization of the property, the MRB will be partially repaid and the maximum balance of the MRB after stabilization will not exceed $44.1 million and will have a maturity date of 3/31/2040. 72 (4) The Partnership committed to provide total funding of an MRB up to $29.5 million and a taxable MRB up to $12.5 million during the acquisition and rehabilitation phase of the property on a draw-down basis.
In addition, the Partnership may acquire and hold interests in multifamily, student and senior citizen residential properties (“MF Properties”) until their “highest and best use” can be determined by management. As of December 31,2022, we had four reportable segments: (1) Affordable Multifamily MRB Investments, (2) Seniors and Skilled Nursing MRB Investments, (3) Market-Rate Joint Venture Investments and (4) MF Properties.
In addition, the Partnership may acquire and hold interests in multifamily, student and senior citizen residential properties (“MF Properties”). As of December 31, 2023, we had four reportable segments: (1) Affordable Multifamily MRB Investments, (2) Seniors and Skilled Nursing MRB Investments, (3) Market-Rate Joint Venture Investments and (4) MF Properties.
(3) A property is considered stabilized once it reaches 90% physical occupancy for 90 days and an achievement of 1.15 times debt service coverage ratio on amortizing debt service for a period after construction completion or completion of the rehabilitation.
(3) A property is considered stabilized once it reaches 90% physical occupancy for 90 days and an achievement of 1.15 times debt service coverage ratio on amortizing debt service for a period after construction completion or completion of the rehabilitation. (4) The MRB is defeased and as such, the Partnership does not report property occupancy information.
We use target constraints for each type of financing to manage to an overall maximum leverage level (the “Leverage Ratio”), as established by the Board of Managers of Greystone Manager. In February 2023, the Board of Managers of Greystone Manager approved an increase in the maximum Leverage Ratio from 75% to 80%.
We use target constraints for each type of financing to manage to an overall 80% maximum leverage level (the “Leverage Ratio”), as established by the Board of Managers of Greystone Manager.
There was an approximately $49.0 million outstanding balance on the Acquisition LOC and approximately $1.0 million was available as of December 31, 2022. The outstanding balance on the Acquisition LOC was entirely repaid in January 2023. The Acquisition LOC has a maturity date of June 2024, with two one-year extension options, subject to certain terms and conditions.
There was $16.9 million outstanding on the Acquisition LOC, which was entirely repaid in January 2024. Approximately $50.0 million was available as of January 31, 2024. The Acquisition LOC has a maturity date of June 2024, with two one-year extension options, subject to certain terms and conditions.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

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Biggest changeThese optional call features may be at either par or premiums to par. In addition, our GIL and most property loan investments are prepayable at any time without penalty. Borrowers may choose to redeem our investments if prevailing market interest rates are lower than the interest rate on our investment asset or for other reasons.
Biggest changeReinvestment Risk 76 MRB investments may have optional call features that may be exercised by either the borrower or the Partnership that are earlier than the contractual maturity. These optional call features may be at either par or premiums to par. In addition, our GIL and most property loan investments are prepayable at any time without penalty.
Increases in area median income are not necessarily correlated to inflationary increases in operating expenses. A significant mismatch between area median income growth and increased property operating expenses could negatively impact net operating cash flows available to pay debt service. If AMI declines on a year-over-year basis, rents could need to be reduced.
Increases in area median income are not necessarily correlated to inflationary increases in property operating expenses. A significant mismatch between area median income growth and increased property operating expenses could negatively impact net operating cash flows available to pay debt service. If AMI declines on a year-over-year basis, rents could need to be reduced.
We seek to actively manage these and other risks and to acquire and hold assets that we believe justify bearing those risks, and to maintain capital levels consistent with those risks. The current rising interest rate environment, the recent inflationary environment, and the risk of a potential recession have contributed to increasing market risk.
We seek to actively manage these and other risks and to acquire and hold assets that we believe justify bearing those risks, and to maintain capital levels consistent with those risks. The recent rising interest rate environment, the recent inflationary environment, and the risk of a potential recession have contributed to increasing market risk.
The interest rate sensitivity table above (the “Table”) represents the change in interest income from investments, net of interest on debt and settlement payments for interest rate derivatives over the next twelve months, assuming an immediate parallel shift in the LIBOR yield curve and the resulting implied forward rates are realized as a component of this shift in the curve.
The interest rate sensitivity table above (the “Table”) represents the change in interest income from investments, net of interest on debt and settlement payments for interest rate derivatives over the next twelve months, assuming an immediate parallel shift in the SOFR yield curve and the resulting implied forward rates are realized as a component of this shift in the curve.
Certain MRB, GIL, and construction financing property loan investments fund the construction of new affordable multifamily properties and have variable interest rates. Since there are little to no operating cash flows during the construction and lease-up periods for new properties, borrowers utilize capitalized interest reserves to fund debt service prior to stabilization.
Certain MRB, GIL, and construction financing property loan investments that fund the construction of new affordable multifamily properties may have variable interest rates. Since there are little to no operating cash flows during the construction and lease-up periods for new properties, borrowers utilize capitalized interest reserves to fund debt service prior to stabilization.
Such cost overruns may cause defaults on our construction financing investments if other funding sources are not available to the borrowers or if related guarantors fail to meet their obligations. Defaults on our MRB, GIL, or property loans investments may reduce the amount of future cash available for distribution to Unitholders.
Such cost overruns may cause defaults on our construction financing investments if other funding sources are not available to the borrowers or if related guarantors fail to meet their obligations. Defaults on our MRB, GIL, or property loan investments may reduce the amount of future cash available for distribution to Unitholders.
The ultimate economic impact of these market risks will depend on the exposures that arise during the period, our risk mitigation strategies at that time and the overall business and economic environment. We employ leverage to fund the acquisition of many of our fixed income assets. Approximately 75% of our leverage bears interest at short term variable interest rates.
The ultimate economic impact of these market risks will depend on the exposures that arise during the period, our risk mitigation strategies at that time and the overall business and economic environment. 74 We employ leverage to fund the acquisition of many of our fixed income assets. Approximately 69% of our leverage bears interest at short term variable interest rates.
Fewer new investment opportunities of this kind may result from negative changes in various economic factors and those new investments that we do make may not generate the same returns as our prior investments due to factors including, but not limited to, increasing competition in the development of market-rate multifamily rental properties, rising interest rates and increasing construction costs.
Fewer new investment opportunities may result from negative changes in various economic factors and those new investments that we do make may not generate the same returns as our prior investments due to factors including, but not limited to, increasing competition in the development of market-rate multifamily rental properties, rising interest rates on construction loans and increasing construction costs.
Item 7A. Quantitative and Qualitat ive Disclosures About Market Risk. The primary components of our market risk at December 31, 2022 are related to interest rate risk and credit risk. Our exposure to market risks relates primarily to our investments in MRBs, GILs, property loans and our debt financing.
Item 7A. Quantitative and Qualitat ive Disclosures About Market Risk. The primary components of our market risk as of December 31, 2023 are related to interest rate risk and credit risk. Our exposure to market risks relates primarily to our investments in MRBs, GILs, property loans and our debt financing.
Lower returns on new investment opportunities will result in declining operating results over time. 75
Lower returns on new investment opportunities will result in declining operating results over time. 77
Increases in market interest rates will cause an increase in debt service costs. If interest rate increases are large enough, such capitalized interest reserves and other budgeted contingencies may be insufficient to pay all debt service through stabilization.
Increases in market interest rates will cause an increase in debt service costs where variable rate financing is used. If interest rate increases are large enough, such capitalized interest reserves and other budgeted contingencies may be insufficient to pay all debt service through stabilization.
The table below summarizes the geographic concentrations in these states as a percentage of the total MRB principal outstanding: December 31, 2022 December 31, 2021 Texas 37 % 41 % California 26 % 23 % South Carolina 17 % 11 % Mortgage Revenue Bonds Sensitivity Analysis Third-party pricing services are used to value our MRB investments.
The table below summarizes the geographic concentrations in these states as a percentage of the total MRB principal outstanding: December 31, 2023 December 31, 2022 Texas 32 % 37 % California 25 % 26 % South Carolina 21 % 17 % Mortgage Revenue Bonds Sensitivity Analysis Third-party pricing services are used to value our MRB investments.
As a result, the primary sources of principal and interest payments on our MRB, GIL, and the property loan investments are the net operating cash flows generated by these properties or the net proceeds from a sale or refinance of these properties.
In addition, the MRB, GIL, and the associated property loan investments are non-recourse obligations of the property owner. As a result, the primary sources of principal and interest payments on our MRB, GIL, and the property loan investments are the net operating cash flows generated by these properties or the net proceeds from a sale or refinance of these properties.
Our remaining 25% of leverage has fixed interest rates. Of those assets funded with short term variable rate debt facilities, more than half bear interest at a variable rate as well.
Our remaining 31% of leverage has fixed interest rates. Of those assets funded with short term variable rate debt facilities, approximately 35% bear interest at a variable rate as well.
In addition, we carefully monitor the on-going performance of the properties underlying these investments. Credit risk is also present in the geographical concentration of the properties securing our MRB investments. We have significant geographic concentrations in Texas, California, and South Carolina.
Credit risk is also present in the geographical concentration of the properties securing our MRB investments. We have significant geographic concentrations in Texas, California, and South Carolina.
If we take ownership of the property securing a defaulted MRB or GIL investment, we will be entitled to all net operating cash flows generated by the property and will be subject to risks associated with ownership of multifamily real estate.
If we take ownership of the property securing a defaulted MRB or GIL investment, we will be entitled to all net operating cash flows generated by the property and will be subject to risks associated with ownership of multifamily real estate. If such an event occurs, these investments will not provide tax-exempt income.
The effective yield analysis for each MRB considers the current market yield of similar securities, specific terms of each MRB, and various characteristics of the property collateralizing the MRB such as debt service coverage ratio, loan to value, and other characteristics. We completed a sensitivity analysis which is hypothetical and is as of a specific point in time.
The effective yield analysis for each MRB considers the current market yield of similar securities, specific terms of each MRB, and various characteristics of the property collateralizing the MRB such as debt service coverage ratio, loan to value, and other characteristics.
Our strategy involves making JV Equity Investments for the development, stabilization and sale of market-rate multifamily rental properties. Our initial equity contributions are returned upon sale of the underlying properties, at which time we will look to reinvest the capital into new JV equity Investments or other investments.
Our initial equity contributions are returned upon sale of the underlying properties, at which time we will look to reinvest the capital into new JV Equity Investments or other investments.
The results of the sensitivity analysis may not be indicative of actual changes in fair value and should be used with caution.
We completed a sensitivity analysis which is hypothetical and is as of a specific point in time. The results of the sensitivity analysis may not be indicative of actual changes in fair value and should be used with caution.
If such an event occurs, these investments will not provide tax-exempt income. 74 We actively manage the credit risks associated with our MRB, GIL, and property loan investments by performing a complete due diligence and underwriting process of the owners and properties securing these investments prior to investing.
We actively manage the credit risks associated with our MRB, GIL, and property loan investments by performing a complete due diligence and underwriting process of the owners and the properties securing these investments prior to investing. In addition, we carefully monitor the on-going performance of the properties underlying these investments.
Furthermore, the results included in the Table assume we do not act to change our sensitivity to the movement in interest rates. As the above information incorporates only those material positions or exposures that existed as of December 31, 2022, it does not consider those exposures or positions that have arisen or could arise after that date.
As the above information incorporates only those material positions or exposures that existed as of December 31, 2023, it does not consider those exposures or positions that have arisen or could arise after that date.
In order to maintain or grow our investment portfolio size and earnings, we must reinvest repayment proceeds in new assets. New MRB, GIL and property loan investment opportunities may not generate the same returns as our current investments such that our reported operating results may decline over time.
New MRB, GIL and property loan investment opportunities may not generate the same returns as our current investments such that our reported operating results may decline over time. In addition, rising interest rates and construction costs could limit the ability of developers to initiate new projects for us to finance with MRB, GIL, and property loan investments.
Our GIL and property loan investments predominantly bear interest at variable rates and all are subject to interest rate floors.
Our GIL and property loan investments predominantly bear interest at variable rates and all are subject to interest rate floors. We regularly hedge our exposure to changes in interest rates where we have financed fixed rate investment assets with variable rate debt financing by executing SOFR-denominated interest rate swaps.
For information on our debt financing and interest rate derivatives see Notes 15 and 17, respectively. Credit Risk Our primary credit risk is the risk of default on our investment in MRBs, GILs and property loans collateralized by multifamily residential, seniors housing and skilled nursing properties.
Credit Risk Our primary credit risk is the risk of default on our investment in MRBs, GILs and property loans collateralized by multifamily residential, seniors housing and skilled nursing properties. The MRB and GIL investments are not direct obligations of the governmental authorities that issue the MRB or GIL and are not guaranteed by such authorities or any issuer.
Assumptions include anticipated interest rates; relationships between different interest rate indices such as SOFR, LIBOR and SIFMA; and outstanding investment, debt financing and interest rate derivative positions. No assurance can be made that the assumptions included in the Table presented herein will occur or that other events will not occur that will affect the outcomes of the analysis.
No assurance can be made that the assumptions included in the Table presented herein will occur or that other events will not occur that will affect the outcomes of the analysis. Furthermore, the results included in the Table assume we do not act to change our sensitivity to the movement in interest rates.
The table below summarizes the sensitivity analysis metrics related to our MRB investments as of December 31, 2022: Description Estimated Fair Value (in 000's) Range of Effective Yields used in Valuation Range of Effective Yields if 10% Adverse Applied Additional Unrealized Losses with 10% Adverse Change (in 000's) Mortgage Revenue Bonds $ 799,408 2.6% -20.3% 2.9 % -22.3% $ 21,347 Reinvestment Risk MRB investments may have optional call features that may be exercised by either the borrower or the Partnership that are earlier than the contractual maturity.
The table below summarizes the sensitivity analysis metrics related to our MRB investments as of December 31, 2023: Description Estimated Fair Value (in 000's) Range of Effective Yields used in Valuation Range of Effective Yields if 10% Adverse Applied Additional Unrealized Losses with 10% Adverse Change (in 000's) Mortgage Revenue Bonds (1) $ 930,675 2.3% - 7.7% 2.5 % -8.5% $ 23,890 (1) Mortgage revenue bonds excludes the Provision Center 2014-1 MRB for figures as of December 31, 2023 as the proton therapy center securing the MRB was successfully sold out of bankruptcy in July 2022 and we received liquidation proceeds of $3.7 million in January 2023.
Interest Rate Risk The year ended December 31, 2022 was a volatile period for the fixed income markets as the Federal Reserve announced Federal Funds Rate increases totaling 425 basis points and signaled additional future short term interest rate increases to combat inflation in the broader economy.
Interest Rate Risk Volatility in the fixed income markets continued throughout 2023. The Federal Reserve announced seven increases in short-term interest rates totaling 525 basis points during 2022 and 2023 to combat price inflation, with the last rate increase occurring in July 2023.
In others, a shorter-term hedge has been executed due to uncertainty regarding the time period over which the individual fixed rate asset might be outstanding. 73 LIBOR and certain other variable rate benchmark indices to which some of our asset and liabilities remain tied, are the subject of recent national, international, and regulatory guidance and proposals for reform.
In some cases, these positions have been hedged to their expected maturity date. In others, a shorter-term hedge has been executed due to uncertainty regarding the time period over which the individual fixed rate asset might be outstanding. The ICE Benchmark Association, or IBA, ceased publication of our relevant U.S. dollar LIBOR settings effective July 1, 2023.
In February 2023, the Federal Reserve announced an additional 25 basis point increase in short term interest rates and indicated ongoing increases in interest rates will be likely. The Federal Reserve has also stated its intention to reduce its balance sheet of US treasury bonds and mortgage-backed securities which may cause further upward pressure on interest rates.
The Federal Reserve has recently maintained rates at the current levels as it analyzes further employment, price and economic data for indications of inflation declining to its long-term annual inflation target of 2%. The Federal Reserve continues to reduce its balance sheet of US treasury bonds and mortgage-backed securities which may cause further upward pressure on interest rates.
In addition, rising interest rates and construction costs could limit the ability of developers to initiate new projects for us to finance with MRB, GIL, and property loan investments. Similarly, we are subject to reinvestment risk on the return of capital from sales of JV Equity Investments.
Similarly, we are subject to reinvestment risk on the return of capital from sales of JV Equity Investments. Our strategy involves making JV Equity Investments for the development, stabilization and sale of market-rate multifamily rental properties.
The following table sets forth information regarding the impact on our net interest income assuming various changes in short-term interest rates as of December 31, 2022: Description - 25 basis points + 50 basis points + 100 basis points + 150 basis points + 200 basis points TOB Debt Financings $ 1,095,473 $ (2,190,947 ) $ (4,381,893 ) $ (6,572,840 ) $ (8,763,787 ) TEBS Debt Financings 125,580 (251,160 ) (502,320 ) (753,480 ) (1,004,640 ) Other Financings & Derivatives (194,490 ) 388,980 777,960 1,166,939 1,555,919 Variable Rate Investments (904,407 ) 1,808,813 3,617,626 5,426,440 7,235,253 Net Interest Income Impact $ 122,156 $ (244,314 ) $ (488,627 ) $ (732,941 ) $ (977,255 ) Per BUC Impact (1) $ 0.005 $ (0.011 ) $ (0.022 ) $ (0.033 ) $ (0.043 ) (1) The net interest income change per BUC calculated based on 22,538,878 BUCs outstanding as of January 31, 2023.
The following table sets forth information regarding the impact on our net interest income assuming various changes in short-term interest rates as of December 31, 2023: Description - 25 basis points + 50 basis points + 100 basis points + 150 basis points + 200 basis points TOB Debt Financings $ 1,121,527 $ (2,243,054 ) $ (4,486,107 ) $ (6,729,161 ) $ (8,972,215 ) TEBS Debt Financings 67,673 (135,347 ) (270,693 ) (406,040 ) (541,386 ) Other Financings & Derivatives (697,003 ) 1,394,006 2,788,011 4,182,017 5,576,022 Variable Rate Investments (383,427 ) 766,854 1,533,708 2,300,562 3,067,416 Net Interest Income Impact $ 108,770 $ (217,541 ) $ (435,081 ) $ (652,622 ) $ (870,163 ) Per BUC Impact (1) $ 0.005 $ (0.010 ) $ (0.019 ) $ (0.029 ) $ (0.038 ) (1) The net interest income change per BUC calculated based on 22,897,187 BUCs outstanding as of December 31, 2023.
Removed
In some cases, these positions have been hedged to their expected maturity date.
Added
Though the variable rate indices of our debt financing and interest rate swaps may differ, the interest rate swaps have effectively synthetically fixed the interest rate of the related debt financing. The majority of our variable-rate debt financings that are hedged through interest rate swaps have interest that is tax-exempt to the senior securities holders.
Removed
The ICE Benchmark Association, or IBA, intends to cease publication of our relevant U.S. dollar LIBOR settings immediately after June 30, 2023. Further, on March 15, 2022, the Consolidated Appropriations Act of 2022, which includes the Adjustable Interest Rate (LIBOR) Act, was signed into law in the U.S.
Added
In order to account for the differential between our interest rate swaps which are indexed to SOFR (a taxable rate) and our debt financing rate (which is correlated to short-term tax-exempt municipal securities rates), we assume that, over the term of our debt financing, the tax-exempt senior securities interest rate will approximate 70% of the SOFR rate.
Removed
This legislation establishes a uniform benchmark replacement process for financial contracts that mature after June 30, 2023 which do not contain clearly defined or practicable fallback provisions. The legislation also creates a safe harbor that shields lenders from litigation if they choose to utilize a replacement rate recommended by the Board of Governors of the Federal Reserve.
Added
This assumption aligns with common market assumptions and the historical correlation between taxable and tax-exempt municipal short-term securities rates. However, such ratio may not be accurate in the short term or long term in the future.
Removed
The Federal Reserve, in conjunction with the Alternative Reference Rates Committee, a steering committee comprised of large U.S. financial institutions, has identified the SOFR index as its preferred alternative rate for USD LIBOR. As of December 31, 2022, LIBOR indices are utilized as the variable benchmark rate on one MRB, one taxable MRB, three property loans, and our General LOC.
Added
The table does not reflect any non-cash mark-to-market gains or losses on interest rate swaps caused by the assumed changes in interest rates. Assumptions include anticipated interest rates; relationships between different interest rate indices such as SOFR and SIFMA; and outstanding investment, debt financing and interest rate derivative positions.
Removed
At this time, it is not possible to predict how markets will respond to SOFR or other alternative reference rates as the transition away from USD LIBOR proceeds. Despite the LIBOR transition in various markets, multi-rate environments may persist in the near term as regulators and working groups have suggested market participants adopt alternative reference rates.
Added
As of June 30, 2023, all Partnership contracts that were previously indexed to LIBOR were amended to replace such terms with SOFR or Term SOFR indexed rates such that our exposure to the cessation of LIBOR is minimal. Despite the LIBOR transition in various markets, multi-rate environments may persist in the near term.
Removed
The MRB and GIL investments are not direct obligations of the governmental authorities that issue the MRB or GIL and are not guaranteed by such authorities or any issuer. In addition, the MRB, GIL, and the associated property loan investments are non-recourse obligations of the property owner.
Added
However, we have not observed any material negative impacts to our investment or debt financing portfolios as a result of the cessation of LIBOR. For information on our debt financing and interest rate derivatives see Notes 16 and 18, respectively.
Added
In the event of default, we will likely be 75 required to repay debt secured by our investment using available liquidity or arrange alternative financing, if available, which is likely to be at less favorable terms. Such occurrences will negatively impact our overall available liquidity.
Added
The effective yield for each MRB has historically trended with, although is not directly influenced by, medium and long-term interest rate movements. Our valuation service provider uses tax-exempt and taxable housing interest rate curves published by Municipal Market Data to estimate the value of our MRB investments.
Added
Our valuation service provider primarily uses the A rated Tax Exempt Housing Sector Yield Curve, which decreased by an average 29 basis points during 2023. The 10 year and 30 year United States Treasury yield increased zero and six basis points, respectively, during 2023.
Added
The 5 year and 10 year SOFR swap rate decreased 22 and 8 basis points, respectively, during 2023. These interest rate changes have a direct effect on the market value of our MRB portfolio, but do not directly impact a borrower's ability to meet its obligations.
Added
The valuation as of December 31, 2023 is based on expected additional liquidation proceeds of approximately $928,000 at final liquidation. Real Estate Valuation Risk Our JV Equity Investments fund the construction, stabilization and sale of market-rate multifamily real estate.
Added
The realizable property values for such investments are primarily dependent upon the value of a property to prospective buyers at the time of its sale, which may be impacted by market cap rates, the operating results of the property, local market conditions and competition, and interest rates on mortgage financing.
Added
We have noticed market cap rates are trending upward due to, though not limited to, the current economic environment and increasing interest rates. We have also noted that rental rates may be decreasing in certain markets, which would lower property operating results leading to a reduction in property valuations.
Added
Operating results of real estate properties may be affected by many factors, such as the number of tenants, the rental and fee rates, operating expenses, the cost of repairs and maintenance, taxes, debt service requirements, competition from other similar multifamily rental properties and general and local economic conditions.
Added
In addition, all outstanding financing directly secured by such real estate properties must be repaid upon sale. Lower sales proceeds may prevent us from collecting our accrued preferred return or the return of our original investment equity, which would result in realized losses on our investments.
Added
Borrowers may choose to redeem our investments if prevailing market interest rates are lower than the interest rate on our investment asset or for other reasons. In order to maintain or grow our investment portfolio size and earnings, we must reinvest repayment proceeds in new assets.
Added
We have observed declining availability of credit and tighter credit underwriting standards for banks that provide construction financing for our JV Equity Investments, which may result in lower loan proceeds and higher rates on construction loans in the near-term such that new investment profitability is negatively impacted or more difficult to originate.

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