Project Efficiency: The project was financed through a single mortgage with no government underwriting; the streamlined process leads to shorter closing time- frame and reduced transaction costs. A complete upfront capitalization through PFS financing would streamline the process further. Neighborhood Impact: Repositioning of property will positively impact the surrounding neighborhood and add to its appeal without the negative impact of gentrification. Social Service Provision: Through Operation Pathways, NHPF provides a wide array of educational, health, and resident enrichment programming, resident engagement and empowerment, as well as resident service coordination. Recapitalization Project Finance: PFS acquisition financing with no payment requirement at the recapitalization phase reduces the uses of funds by approxi- mately $6.8 million. This allows for the next phase to become financially feasible without the need for scarce soft funds. Financial Leverage: PFS funds will leverage public and private funds such as tax-exempt bonds, Sec 8 Rental Subsidy, $31 million of FHA insured hard debt, $11 million of LIHTC and Historic tax credits. Job Creation: Rehab projects are labor intensive and given that at least half of the labor hours for this project need to come from residents in the City of Chicago, this will boost the employment rate and contributions to the tax base in the City of Chicago. The repositioning of both residential and retail space will create new long term jobs at those businesses, as they expand their operations in this part of Chicago.
Funding: Table 5 on the next page shows funding through traditional and PFS contract funding mechanisms.
Pay for Success and Resident Services Providing safe and adequate physical shelter is only half the battle of ensuring access to affordable housing. Without comprehensive resident services to assist in the maintenance of properties, communities risk high vacancies and resi- dent turnover. Resident services help occupants keep their housing and provide important social services such as counseling and afterschool care. A report by the National Resident Services Collaborative finds the most common issues that wraparound service and referral programs can address include problem ten- ants, economic hardship, crime and safety, childcare, workforce development, and addressing family crises. 91 In addition to assisting residents, services make
40 Pay for Success & Affordable Housing | Stefano Rumi
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