Manatt Impact Investing and Community Development Partner Corenia Burlingame was quoted in a Bloomberg Tax article about how finalized housing tax credit from the Internal Revenue Service could boost investor interest.
Prior to these rules being finalized, financial, corporate and insurance companies decreased investment in affordable housing projects due to fears the entire low-income housing tax credit being recaptured if one unit went out of compliance. Burlingame said the market dried up and deals weren’t getting done.
However, she said now the final rules have hopefully addressed investors’ concerns.
“I think it will lead to your traditional financial institution investor being more comfortable taking on the risk of recapture when it’s a one- or two-unit recapture, as opposed to 100% of the project recapture risk,” Burlingame said. “I don’t anticipate new players in the market, but I do think that it will unfreeze the restrictions on these projects that have been in place since 2020.”
Bloomberg Tax subscribers can read the full article here.