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Syndication Leasing Structures How Tax Credits Become Capital: When and How to Syndicate Panel USING HISTORIC TAX CREDITS IN NEW YORK June 24, 2009

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Syndication Leasing Structures. How Tax Credits Become Capital: When and How to Syndicate Panel USING HISTORIC TAX CREDITS IN NEW YORK June 24, 2009. The Rehabilitation Tax Credits Internal Revenue Code Section 47. Tenants. Single Entity Structure. Tax Credit Investor LLC. - PowerPoint PPT Presentation

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Page 1: Syndication Leasing Structures

Syndication Leasing Structures

How Tax Credits Become Capital: When and How to Syndicate Panel

USING HISTORIC TAX CREDITS IN NEW YORK

June 24, 2009

Page 2: Syndication Leasing Structures

The Rehabilitation Tax CreditsInternal Revenue Code Section 47

Page 3: Syndication Leasing Structures

Tax Credit Investor LLC

Tax Credit Investor LLC

Tax Credit, LLC(Property Owner)

Tax Credit, LLC(Property Owner)

Tax Credit InvestorTax Credit Investor

Single Entity Structure

TenantsTenants

RentalPayments

Construction/Perm Lender

Construction/Perm Lender

Managing Member(Developer Affiliate)

Managing Member(Developer Affiliate)

HistoricTax Credit

Equity

99.99% Credits, Profits & Losses and Cash Flow

LoanProceeds

DebtService

Payments

.01% Credits, Profits & Losses, Fees and

Cash Flow

DeveloperEquity

DeveloperDeveloperDev.Fee

Page 4: Syndication Leasing Structures

Tax Credit Investor LLC

Tax Credit Investor LLC

Master Tenant, LLC(Master Tenant)

Master Tenant, LLC(Master Tenant)

Landlord, LLC(Property Owner/Lessor)

Landlord, LLC(Property Owner/Lessor)

Master Lease/Credit Pass-Through Structure

Sub-Tenants/End Users

Sub-Tenants/End Users

RentalPayments

Construction/Perm Lender

Construction/Perm Lender

Managing Member(Developer Affiliate)

Managing Member(Developer Affiliate)

HistoricTax Credit

Equity

99.99% Credits, Profits & Losses, and Cash Flow

LoanProceeds

DebtService

Payments

.01% Credits, Profits & Losses, Fees and

Cash Flow

DeveloperEquity

>50% Profits & Losses, Fees and

Cash Flow

Pass-through of Historic Tax Credits & Share of Residual

Lease Payment &Equity Investment

<50% of Landlord Profits& Losses

Page 5: Syndication Leasing Structures

Andrew Potts, Esq.401 9th Street, NWSuite 900Washington, DC 20004

202.585.8337202.585.8080 (Fax)

[email protected]

Thank You