Tax Credit Investments and General Tax Low-Income Housing Tax Credit Transactions Gallagher has represented clients in the low-income housing tax credit (LIHTC) industry since the program was established in 1986. Our representation began as developer's counsel on several of the first LIHTC projects in Maryland and the nation. Since then, we have been involved in more than 900 transactions in nearly every state on behalf of developers, direct investors, and syndicators. We have represented both nonprofit and for-profit developers in Maryland and in many other states. On the direct investor and syndicator side, we have been counsel to Enterprise Community Investment, Inc. in connection with closing LIHTC transactions since the early 1990s, and we closed LIHTC transactions for Lend Lease, and then MMA, from 2001 until 2009, when its tax credit business was sold. In addition, we have represented several direct investors. Gallagher is well respected and well known in the LIHTC industry. We have experience in every type of LIHTC transaction, having structured and closed many bond transactions, HOPE VI public housing and HUD 202 transactions, HUD IRP payment transactions, and more recently, GO Zone transactions in the Gulf Coast, new issue bond program, for both developers and investors. We have also closed transactions using tax credit exchange and TCAP funds and section 1603 credits in lieu of energy credits. These transactions typically involve complicated structures with several layers of federal, state, local, and private financing. Historic Tax Credit Transactions Gallagher has represented developers, syndicators, and investors in over fifty transactions nationwide utilizing federal and state historic credits. Our investor and syndicator clients have included Fannie Mae, MMA, Enterprise Community Investment, Inc., and various pension funds. Our work representing syndicators and direct investors involves collecting and reviewing all necessary due diligence, structuring the transaction to comply with the applicable sections of the Internal Revenue Code, and providing legal and tax analysis to support the financial and underwriting goals of the investor. Often we provide an opinion to support the investor’s anticipated tax benefits from the project, or, if representing an investor, review the tax opinion of syndicator counsel. Historic credit transactions typically involve master lease or sandwich lease structures, which require coordinating multiple entity structures and multiple layers of financing, including other types of tax credits and mezzanine equity. Gallagher’s real estate team of attorneys and paralegals generally collaborates with our tax attorneys on these transactions. If more efficient, Gallagher serves as special tax counsel and coordinates the transaction structure and equity investment with local counsel who handles the debt and real estate matters. New Markets Tax Credit Transactions In the new markets tax credit area, Gallagher represents developers using both debt and equity new markets structures. We also have helped clients form community development entities (CDE's) and have prepared applications for new markets tax credit allocations. As counsel for the developer, we recently closed a transaction involving two new markets credit equity providers, federal and state historic credit equity investors, and private and state and local government lenders. We currently are representing developers in several similarly-structured transactions. When representing a developer, we work closely with accountants and investor's counsel to meet the goals of the developer, while considering the needs of the CDE's and Investors involved in the transactions. Energy Credit Transactions Clients benefit from our extensive experience in the energy credit area. Because of our tax credit and financing experience, we can identify and address issues critical to commercial lenders and institutional investors early in the project development cycle. This allows our clients to maximize the economic potential of their projects and minimize transaction costs. We have worked with both syndicators and developers in energy credit and section 1603 energy grant transactions. General Tax In addition to our firm's tax credit practice, we represent our clients in general tax matters, including the structuring of real estate transactions and joint ventures, the negotiation of partnership and limited liability company arrangements between investors and developers, and general income tax advice. We also represent many prominent tax-exempt entities in Maryland. Examples of the types of transactions and clients we have represented on projects throughout the nation include: Several national syndicators and direct purchasers of the Code Section 42 low income housing tax credits and the Code Section 47 historic tax credits; Code Section 47 historic tax credit projects using master lease and sandwich lease structures, both with and without new markets tax credits, including projects involving pension funds; Code Section 45D new markets tax credit projects involving debt and equity structures, representing both for-profit and nonprofit developers; Real estate development companies in Maryland and throughout the United States, both for-profit and nonprofit, developing projects using low income housing tax credits, new markets tax credits, and historic tax credits; Hope VI public housing projects, HUD 202 housing projects, projects with IRP structures, and projects utilizing tax-exempt bond financing, including the new issue bond program; One of the largest national syndicators of Code Section 48 investment tax credits for solar energy property; Code Section 1031 tax-free real estate exchanges; Joint venture arrangements for real estate investors and real estate developers; and General tax planning for real estate projects, tax-exempt entities, and closely held businesses. How We Are Different We distinguish ourselves from other firms through our collaborative approach. Our goal is not only to get the transaction closed, but also to maintain a positive relationship among all of the parties involved. Clients benefit from the close working relationship our tax attorneys have with our real estate attorneys, particularly on sophisticated real estate issues that are unique to projects that are historic, urban, or both. Another distinct advantage relates to our staffing of transactions. We encourage the use of paralegals where appropriate. The manner in which we recruit and train paralegals is a particular strength of our firm. Our paralegals are selected carefully, based on the quality of their legal skills, motivation, commitment to the profession and their ability to interact with clients. Our tax credit and real estate paralegals have a minimum of ten years of experience with at least five years of experience closing syndicated real estate transactions with tax credits. The use of paralegals provides significant cost benefits for clients, as they review and prepare basic diligence and coordinate the transaction closing, thereby reducing attorney time and facilitating a timely closing. Representative Tax Credit Transactions Monarch Mills: Gallagher represented the developer in a $43 million dollar 269-unit mixed income apartment project in Columbia, Maryland. The project was financed with a HUD 221(d)(4) loan, state financing, and low-income housing tax credits. The general partner was the Howard County, Maryland Housing Commission HRI GO Zone Projects: Gallagher represented the equity investor in four significant affordable housing developments in New Orleans, Louisiana, each supported by equity from GO Zone federal LIHTCs, a mixture of federal and state funds and subsidies and, for two of the projects, PILOTs. River Garden CSII is a mixed-use HOPE VI project featuring 310-units in the residential rental phase. Nine27 Apartments is a market-rate and affordable housing project. Redemptorist Apartments is an affordable housing project featuring 107-units located in buildings leased from the Society of Redemptorists and renovated to qualify for federal historic tax credits. Bywater Art Lofts is an affordable housing project with a preference for artists located in a renovated building qualifying for federal historic tax credits. Lafitte: Gallagher is representing a joint venture among three developers in a multi-phase $250 million redevelopment of one of the "big four" public housing projects in New Orleans in the wake of Hurricane Katrina. The redevelopment consists of an 812-unit mixed-income, rental and homeownership project, including townhomes and a multi-story senior facility, on the former public housing site as well as surrounding scattered sites. The project is financed with HUD capital grant funds, GO Zone LIHTCs and funds from the Louisiana Office of Community Development among other sources. Franklin Hill: Gallagher represented the equity investor of a 152-unit, $63.5 million mixed-finance project in Boston, which included both public housing and LIHTC financed units. The project was supported with federal, state and city funds and also received rental subsidies under the federal Section 8 and Section 9 programs. Gallagher's client invested nearly $45 million in the project, which represents one of the larger LIHTC equity investments nationally. Oxford Plaza: Gallagher represented the equity investor in the affordable housing component of a $75 million complex mixed-use project in Berkeley, California known as Oxford Plaza. Located across from the UC Berkeley campus, the project features 97-units of affordable housing financed with tax credits, an adjacent environmental center, undergraduate public parking, and mission-driven retail space. The largest affordable housing structure in Berkeley, Oxford Plaza also is a model in green design and sustainable building. Takoma Park Preservation: Gallagher represents Enterprise as the tax credit syndicator of the Takoma Park Preservation project developed by Montgomery Housing Partnership. The project is a rehabilitation of seventy-five units in four buildings on three separate sites in Takoma Park. Gallagher represents Enterprise in its partnership with MHP, including its investment of $4,700,000 in the project. Jericho Senior Living: Gallagher represents entities acting as construction contractor, developer, and property manager of a recently completed 270-unit multifamily residential housing project in Prince George's County. The $50 million project, sponsored by Jericho Baptist Church, received LIHTCs and consists of affordable housing and market rate units. Gallagher attorneys led all legal aspects of the project -- including developing a complex real estate structure using a land condominium regime, the negotiation of the financing documents with the tax credit investor and each of the project's lenders, and the structuring of the project to address complex tax issues. United Way of Greater Cincinnati: Gallagher represented the United Way of Greater Cincinnati in financing the renovation of its corporate headquarters with the benefits of new markets tax credit financing. The project involved leveraging the new markets equity with fundraising by the United Way. Two CDEs provided new markets allocations to the project. The building was owned by an affiliate of the United Way and was master leased to the United Way. The United Way used a significant portion of the building and subleased part of the building to other service organizations. The total renovation budget was approximately $20,000,000. Miller's Court: Gallagher represented the developer of a $21.9 million mixed-use project in Baltimore City. The award-winning project includes a 40-unit teacher-housing development with a commercial component. Gallagher handled the entire transaction including the new markets tax credit, and federal and state historic tax credit financing. The new markets transaction was leveraged by several sources of financing and historic credit equity. The transaction involved two new markets investors and two CDEs. Union Mill: Gallagher represented the developer of a $23.7 million mixed-use project in Baltimore City. The project includes a 59-unit teacher-housing development with a commercial component. Gallagher handled the entire transaction, including the new markets tax credit and federal and state historic tax credit financing. The new markets were leveraged by several sources of financing and historic credit equity. The transaction involved two new markets investors, two CDE's, and a master lease structure. Railway Express: Gallagher helped to secure the new markets tax credits and federal and state historic tax credits for Railway Express -- a mixed-use historic rehabilitation project located in Baltimore, Maryland. Originally constructed in 1929 as a mail depot, the 77,000-square-foot structure underwent an $11 million conversion to 30 loft-style apartments with 32,000 square feet of commercial space. Stoneleigh Hotel: Gallagher represented a joint venture in the leasing and renovation of the Stoneleigh Hotel in Dallas, Texas. The project was financed using historic tax credit equity through a sandwich lease structure. We coordinated the process with local counsel for the developer and counsel for a non-tax credit equity investor in the project. The project budget was approximately $55,000,000. Dallas Republic: Gallagher represented MMA, with Fannie Mae as the tax credit investor, in the historic tax credit financing of a large mixed-use project in Dallas, Texas. The $38 million renovation converted one of two towers in a vacant complex in downtown Dallas into 229 apartments. The transaction involved a complicated condominium structure to address ownership of different portions of the complex and a master lease and sublease. 1180 Raymond: We closed historic tax credit financing on behalf of MMA, as the syndicator for Fannie Mae, for the over $50 million renovation of a tower into approximately 320 apartments and 7,800 square feet of retail space. In addition to the tax credit equity, the rehabilitation was financed by mezzanine equity, tax-exempt bonds and various private and public funding sources. The project required us to address tax issues involving debt characterization and a pass-through leasehold structure and to negotiate a satisfactory lease and security structure with several lenders and governmental agencies. Gas Company Buildings: We represented Fannie Mae as the historic tax credit investor in the renovation of three buildings in Los Angeles, California. Formerly the offices of a California gas company, the rehabilitation transformed the buildings into 250 lofts and a supermarket and other commercial space. The costs of the renovation totaled $60 million. Group Members