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HUD Albuquerque Multifamily

HUD Albuquerque Multifamily. MFT – Multifamily for Tomorrow August 20, 2014. When a property is classified as Troubled (rating of 1-5), a formal Action Plan is required to identify specific steps to improve performance.

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HUD Albuquerque Multifamily

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  1. HUD Albuquerque Multifamily MFT – Multifamily for Tomorrow August 20, 2014 Presented by Michael Gamez, Project Manager

  2. When a property is classified as Troubled (rating of 1-5), a formal Action Plan is required to identify specific steps to improve performance.

  3. Goal: Increase revenue by raising community awareness, better targeting tenants, and improving the property’s appeal and safety. • Indicators: • Poor curb appeal • Poor reputation • Low occupancy & high turnover • Low rents • Lack of amenities • Criminal activity • Tenant complaints

  4. Goal: Reduce waste and inefficiency in the project’s budget and operations. • Indicators: • Increasing operating expenses • High accounts payable balance • Improper distributions and withdrawals of project funds • Poor Management and Occupancy Review (MOR) rating • Failure to file annual financial statements • Failure to maintain property • Unresponsive to tenant and HUD inquiries

  5. Goal: Improve the viability of the project through the reduction of debt service or injection of additional funding. • Indicators: • Difficulty paying debt service • High interest rate • High loan age • Low reserve for replacement account balance • Project is in need of extensive rehabilitation

  6. Marble Apartments – Carlsbad, NM • 40% vacancy rate • Extended vacancies • Vacant units are boarded up • Frequent burglaries and drug activity • Frequent tenant complaints about lighting in parking lot • Negative publicity in local newspaper • What would you do?

  7. Marble Apartments – Carlsbad, NM • Meet with local law enforcement and review calls for service logs • Set up police substation • Improve curb appeal to attract new residents • Improve lighting, gates, and surveillance systems • Assess tenant selection criteria and house rules • Update Affirmative Fair Housing Marketing Plan • Hire an experienced management agent

  8. Bosque Apartments – Santa Fe, NM • Accounts payable balance of $180K • Contract with Billy’s Landscaping for $10K monthly • Unpaid property taxes • Annual financial statement is past due • Owner does not respond to HUD’s phone calls or emails • Unauthorized withdrawal of $30K from reserve account • Deferred maintenance issues • Overgrown weeds • What would you do?

  9. Bosque Apartments – Santa Fe, NM • Submit Monthly Accounting Reports to closely monitor expenses • Examine contracts and compare rates • Examine process for obtaining and awarding contracts • Develop preventative maintenance schedule • Develop prioritized plan of action to reduce payables • Develop formal staff training program • Hire an experienced management agent

  10. La Cumbre Apartments – Las Cruces, NM • Difficulty making monthly mortgage payments • 95% occupancy rate • 12% interest rate • Mortgage matures in 2020 • Low reserve for replacement account balance • What would you do?

  11. La Cumbre Apartments – Las Cruces, NM • Contact lender to lower interest rate or extend amortization period • Refinance and rehabilitate the property • Request approval for owner advances • Sell property to another entity with the ability to infuse capital

  12. Michael Gamez, Project Manager • 505-346-6932 • Michael.A.Gamez@hud.gov

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