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Fort Worth Housing Authority and Downtown Fort Worth Initiatives, Inc. Partner to Purchase Hillside Apartments

April 3,2014

FORT WORTH: At the Fort Worth Housing Authority Board meeting, Commissioners approved entering into a joint venture with Downtown Fort Worth Initiatives, Inc. (DFWII) to purchase the 172-unit, mixed-income Hillside Apartments located in the eastern part of downtown.

Built in 1997, Hillside was a pioneering effort in downtown residential development spearheaded by Downtown Fort Worth Initiatives, Inc., with support from the Bass family, City of Fort Worth, and local foundations and corporations. It was developed and has been continuously managed by McCormack Barron Salazar of St. Louis. Through the use of federal housing tax credits, 60% of the units in the development are reserved for families making less than 60% of the area median income.

The Housing Authority/DFWII partnership was initiated when a number of community partners in the development expressed their interest in divesting after the tax credit compliance period ended in 2012. 

“Tax credit investors will typically exit a project once the benefits expire,” said Jim Johnson, of DFWII. “In this case, we were fortunate to find a new partner in the Housing Authority.”

In the transaction, the Housing Authority will finance the purchase of the assets of the community partners, which will be combined with DFWII’s 12 acres of land to be owned by the new Housing Authority/DFWII partnership.

The new entity has pledged to maintain the affordability unit mix for the next 24 years and to use all net revenues from the venture to encourage, promote and assist the development of additional mixed-income housing in Downtown.

At the end of the term, DFWII will have the opportunity to purchase the development for the amount of the outstanding debt. 

“We see this as a legacy opportunity,” said Johnny Campbell of Sundance Square, DFWII’s 2014 Chairman. “We want to be sure that this project stays in local hands and that the use of this land and these assets are held in trust by a group of people who will have downtown Fort Worth’s best interests in mind. The Housing Authority and DFWII are excellent public/private partners for that mission.”

“The Housing Authority is in the business of providing affordable housing to people who need it,” said Housing Authority President, Barbara Holston. “We’ve worked with DFWII on a number of projects, and this is an opportunity for us to ensure the continuation of existing affordable units in downtown while creating a partnership and revenue stream that leads to the development of more in the future.”

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