The Department of Housing and Urban Development (HUD) has proposed a rule to streamline requirements for mixed-finance developments through its Section 202 Supportive Housing for the Elderly program in a bid to encourage private market participation.
The rule would “remove restrictions on the portions of developments not funded through capital advances, thereby lifting barriers on participation in the development of the projects, and eliminating burdensome funding requirements.”
The proposed amendment is meant to attract private capital and the expertise of the private developer community, says HUD, “to create attractive and affordable supportive housing developments for the elderly.”
HUD is also seeking to improve and update other regulations and definitions governing Section 202/Section 811 developments to allow greater flexibility in the design of these programs’ units and extend the duration of the availability of capital advance funds.
In light of current economic conditions that have reduced the availability of private financing for the development of supportive housing, HUD’s proposed rule includes allowing more flexibility in the drawdown of capital advance funds and noncapital advance funds, and would also permit mixed-finance developers to have more flexibility in bringing in private capital by getting rid of restrictions relating to non-capital advance units.
Click here for more information on the proposed rule, which includes updated requirements and definitions.
Written by Alyssa Gerace