Merchants Capital closes $180M affordable housing fund
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Merchants Capital, a subsidiary of Carmel-based Merchants Bank, has created a new business unit to support the construction of low-income housing. Merchants Capital Tax Credit Equity Fund X L.P. has raised $180 million from 15 institutional investors to support 18 affordable housing properties throughout the United States.
Merchants says the fund will create or preserve more than 2,400 affordable homes throughout 12 states, including Indiana. The other properties are located in California, Texas, North Carolina, Connecticut, Missouri, Ohio, Michigan, Illinois, Pennsylvania, Mississippi and Oregon.
The fund uses private equity from institutional investors to create a tax credit that supports the construction of low-income housing.
“With an average rent discount to market of 34%, the affordable homes supported by Merchants Fund X offer families a meaningful boost in quality of life that would not be possible without the creativity, dedication and hard work of our investor and development partners,” said Julie Sharp, executive vice president at Merchants Capital.
The fund is Merchants Capital’s second, and largest, national multi-investor fund. Last year, the company closed its first fund, a $22 million investment supporting seven multifamily housing projects.
“With more than $30 billion in capital provided to multifamily housing since inception, our company has emerged as a leading debt and equity provider for affordable housing across the United States,” said Linda Hill, executive vice president of tax credit equity at Merchants Capital. “We remain focused on financing quality, safe affordable housing through a variety of debt and equity executions across the United States.”
Merchants says investments came from eight repeat investors and seven new investors.