City Council approves bond sale for Southside apartment complex rehab
RRHA will sell $25 million in bonds, which will be repaid by the developer.
An income-restricted apartment complex in Southside is one step closer to changing ownership after Richmond City Council approved a $25-million-dollar bond issue from the city’s housing authority to acquire and rehabilitate the property.
Chippenham Place Apartments is a 144-unit complex just east of where Hull Street Road intersects the Chippenham Parkway. It’s currently owned by Chippenham Place Associates LP, which is registered at the same address as Atlantic American Partners — a private, multistate affordable housing developer based in Providence, Rhode Island.
But City Council aims to facilitate the building’s sale to another private, multistate affordable housing developer, California-based Lincoln Avenue Capital, through the limited partnership Chippenham Place LP. On Monday, Council voted to approve the Richmond Redevelopment and Housing Authority’s plan to sell $25 million worth of tax-exempt bonds for Chippenham Place LP to purchase and renovate the complex. The bonds would be repaid by Chippenham Place using revenue from the complex. Neither the city nor RRHA would be responsible for paying the loans if Chippenham Place fails to do so.
Council President Mike Jones, whose district the complex is in, introduced the resolution Monday and requested an expedited hearing, meaning it was not heard by any committees. Jones said he made the request because of a deadline in acquiring federal money for the project.
“In order to access federal dollars, we’re just under a time constraint from that standpoint,” Jones said. “It’s really going to uplift a particular property that we’ve had challenges with in the past.”
It’s not the first time federal tax benefits have been used to rehabilitate the property.
Through the Low Income Housing Tax Credit program, the current owners of the building received about $7 million in federal tax credits from 2009 through 2019 to rehabilitate the complex and operate it as affordable housing, subject to income and rent restrictions. The owners agreed to rent units only to people making 50% of the Area Median Income, currently $53,300 for a 4-person household, or less.
The property’s LIHTC agreement allows the owners to sell the complex in 2024, after 15 years of operations. If the complex is sold, it would still be subject to its LIHTC restrictions until 2039.
Tenants at the property also have their rents subsidized by voucher payments. The building has held a Section 8 voucher contract since 2011, meaning tenants pay a maximum of 30% of their income in rent. McGuireWoods attorney Ann Curtis Saunders, who is serving as counsel for the bond transaction, said rents will continue to be subsidized if the sale is approved.
“All the units will be subject to the federal [Housing Assistance Payment] program,” Curtis Saunders said, adding that she wasn’t sure how long that HAP contract would last.
Curtis Saunders told council she could provide the city clerk with documents detailing the HAP voucher program that will be in place, but the clerk told VPM News Wednesday those documents had not been provided.
The development will be subject to further affordability requirements if the sale goes through, due to the tax-exempt bonds council approved. Curtis Saunders said those bonds come with a requirement that at least 40% of the units be rented to people who make 60% of AMI — currently $63,960 for a four-person household — or less.
“The 40-60 test will be in place until, at the earliest, there are no more tax-exempt bonds financing the property,” she said.
While RRHA must still work out the details of the bond package, those restrictions could remain in place for 40 years, the maximum bond length authorized by a resolution approved by the housing authority’s board of commissioners in March.
Specific details about the renovation had not been shared with the city clerk’s office by publication. But in response to a question from Councilor Stephanie Lynch, Curtis Saunders said Chippenham Place residents will be able to remain in their homes during the renovation.
Jones, along with Councilor Reva Trammell, classified the complex as troublesome at Monday’s meeting. According to background information included with the resolution, the developer will increase security and install cameras as part of the renovation.
Court records also show a recent spate of displacement there. The current owner of the property, Chippenham Place Associates LP, has filed 40 eviction cases against 30 tenants in Richmond General District Court since October 2022. Fourteen evictions were granted by the court. One case remains pending.