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Multifamily rental rehabilitation loan

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The multifamily rental rehabilitation loan program provides financial rehabilitation assistance to eligible owners and/or landlords of St. Louis Park multifamily residential rental properties with three or more units desiring to make property improvements. The targeted properties are naturally occurring affordable housing (NOAH) properties that have been maintained, are licensed, have no license revocations and are in good standing.

The goal is to provide a rehab incentive for NOAH properties to improve their property without raising rents above the 60 percent area median income (AMI) rent level.

Eligibility requirements

  • Properties must have three or more units
  • Licensed rental properties with no rental license revocations and in good standing
  • Buildings at least 30 years old
  • Properties must meet the St. Louis Park definition of a NOAH property
    • At least 18 percent of units with rents affordable to households with incomes at or below 60 percent area median income (AMI)
  • Property must be current on:
    • Property insurance
    • Property taxes, liens and other assessments
    • Mortgage/contract for deed payments
  • The combined loan-to-value ratio of all loans secured by the property must not exceed 110 percent of the property value
  • No displacement of current residents related to rehabilitation of the property
  • Be willing to restrict rents for a 10-year term or until the sale or transfer of ownership of the property

Loan amounts

  •  Maximum loan amounts
    • Per qualified rent-restricted unit — $5,000
    • Per building/development — $50,000
  • Minimum loan amount — $5,000

Loan terms

  • Loan must be used for improvements in qualified rent-restricted units or in interior or exterior building common spaces
  • Loan is deferred with zero percent interest
  • 10-year term
  • Loan must be matched on a 1:1 basis by other funds
  • Loan principal is due and payable when the property is sold, loan is refinanced or the ownership of the property is transferred
  • Rents of the assisted units must be affordable to households with incomes at or below 60 percent area median income (AMI) for the entirety of the 10-year loan term
  • Annual rent increase for the assisted units may not exceed five percent of the previous rent charged each year, not to exceed 60 percent AMI affordable rent levels
  • Property owners must file an annual self-certification that rents charged for the assisted units do not exceed the 60 percent AMI affordability level
  • Properties must agree to give equal consideration to renting to tenants with housing subsidy vouchers

Contact

Marney Olson
Assistant housing supervisor
molson@stlouispark.org
952.924.2196