Merchants Capital Secures $5M+ for Affordable Housing in FL; Among First to Close Under LIHTC Pilot

CARMEL, Ind. (Oct, 2019) – Mortgage banking company Merchants Capital has secured $5.1 million in financing for an affordable housing development in Dade City, Florida – one of the first to close under the Low-Income Housing Tax Credit (LIHTC) Pilot program. The loan was secured on behalf of Arbour Valley Communities.

The 40-year 221(d)(4) New Construction Loan for the development of Arbours at Hester Lake is among the first to use the expanded LIHTC Pilot Program. The U.S. Department of Housing and Urban Development (HUD) revised the program earlier this year to include new construction and substantial rehabilitation projects using Section 221(d)(4) and Section 220 loans.

Through the Pilot, the borrower is able to close the loan much more quickly. Instead of waiting up to 150 days to close, this nimble product speeds up affordable financing by reducing the processing time for LIHTC deals.

“This is the first loan for Merchants Capital to be approved under the Pilot Program and one of the first to close under the Pilot Program in the country – and certainly the Southeast region,” said Matt Kaercher, Merchants Capital senior vice president and leading originator on the deal. “We closed this loan just 60 days from submission, proving Merchants’ expertise in the LIHTC realm and our delivery on the program’s mandate by submitting a clean, thorough  package to HUD.”

Arbours at Hester Lake’s 80-unit community will provide 12 units for tenants at or below 30% Area Median Income (AMI), 50 units for tenants at or below 60% AMI, eight units for tenants at or below 70% AMI, and 10 units for tenants at or below 80% AMI.

“We’d like to thank the entire Merchants Capital team, as well as the HUD staff in Atlanta, Jacksonville and rest of Southeast region, for their help in making this financing fast and easy for us to begin construction of Arbours at Hester Lake seamlessly,” said an Arbour Valley Communities representative. “Florida faces one of the worst affordable housing crises in the country, and statewide, a person making minimum wage would have to work 84 hours a week to afford a one bedroom apartment at current fair market rent. We are proud to be bringing these much-needed apartments to Dade City residents as an affordable option.”

The loan closed this month with Kaercher and XXTitle Gus Gilmore as leading originators.


Merchants Capital is a multifamily, affordable, and healthcare lender offering a direct way to access fixed rate, long-term, non-recourse financing via our bank, Merchants Bank, all with a single point of contact. Merchants Capital strives to provide the best origination and service of its loan products with exceptional customer service, accuracy, creativity, speed and conformance to regulations. 


Arbour Valley Communities (AVC) develops, owns, and manages multifamily communities throughout the Southeast United States.  Utilizing financing sources ranging from institutional equity, HUD/FHA debt programs, and federal tax credits, to HOME funds and conventional bank debt, AVC newly constructs or acquires and rehabilitates energy-efficient wellness-oriented apartment communities perfectly suited to their communities and residents.