Commitments and Contingencies

3 Months Ended

Mar. 31, 2022

Commitments And Contingencies Disclosure [Abstract]

18. Commitments and Contingencies

Legal Proceedings

The Partnership, from time to time, is subject to various legal proceedings and claims that arise in the ordinary course of business. These matters are frequently covered by insurance. If it has been determined that a loss is probable to occur and the amount of the loss can be reasonably estimated, the estimated amount of the loss is accrued in the Partnership's condensed consolidated financial statements. If the Partnership determines that a loss is reasonably possible, the Partnership will, if material, disclose the nature of the loss contingency and the estimated range of possible loss, or include a statement that no estimate of loss can be made. While the resolution of these matters cannot be predicted with certainty, the Partnership currently believes there are no pending legal proceedings in which the Partnership is currently involved the outcome of which will have a material effect on the Partnership’s financial condition, results of operations, or cash flows.

Bond Purchase Commitments

The Partnership may enter into bond purchase commitments related to MRBs to be issued and secured by properties under construction. Upon execution of the bond purchase commitment, the proceeds from the MRBs will be used to pay off the construction related debt. The Partnership bears no construction or stabilization risk during the commitment period. The Partnership accounts for its bond purchase commitments as available-for-sale securities and reports the asset or liability at fair value. Changes in the fair value of bond purchase commitments are recorded as gains or losses on the Partnership's condensed consolidated statements of comprehensive income (loss). The following table summarizes the Partnership’s bond purchase commitments as of March 31, 2022:


Bond Purchase Commitments	Commitment Date	Maximum Committed Amounts Remaining		Rate			Estimated Closing Date	Fair Value as of March 31, 2022
CCBA Senior Garden Apartments	July 2020	$	3,807,000		4.50	%	Q3 2022	$	-
Anaheim & Walnut	September 2021		3,900,000		4.85	%	Q3 2024		145,323
		$	7,707,000					$	145,323

Investment Commitments

The Partnership has remaining commitments to provide additional funding of certain MRBs, taxable MRBs, GILs, taxable GILs, and property loans while the secured properties are under construction or rehabilitation. The Partnership also has outstanding commitments to contribute additional equity to unconsolidated entities. The following table summarizes the Partnership's total and remaining commitments as of March 31, 2022:


Property Name	Commitment Date	Maturity Date	Interest Rate	Total Initial Commitment		Remaining Commitment as of March 31, 2022
Mortgage Revenue Bonds
Residency at the Mayer - Series A	October 2021	April 2039	SOFR + 3.60% (1)	$	29,500,000	$	4,500,000
Meadow Valley	December 2021	December 2029	6.25%		44,000,000		43,900,000
Subtotal					73,500,000		48,400,000

Taxable Mortgage Revenue Bonds
Ocotillo Springs - Series A-T	July 2020	August 2022 (2)	LIBOR + 3.55% (1)	$	7,000,000	$	3,300,000
Residency at the Mayer Series A-T	October 2021	April 2024 (2)	SOFR + 3.70% (1)		12,500,000		11,500,000
Subtotal					19,500,000		14,800,000

Governmental Issuer Loans
Hope on Avalon	January 2021	February 2023 (2)	SIFMA + 3.75% (1)	$	23,390,000	$	12,408,800
Hope on Broadway	January 2021	February 2023 (2)	SIFMA + 3.75% (1)		12,105,623		3,414,378
Osprey Village	July 2021	August 2024 (2)	SOFR + 3.07% (1)		60,000,000		48,144,643
Willow Place Apartments	September 2021	October 2024 (2)	SOFR + 3.30% (1)		25,000,000		21,028,214
Subtotal					120,495,623		84,996,035

Taxable Governmental Issuer Loans
Hope on Avalon (Taxable)	January 2021	February 2023 (2)	SOFR + 3.55% (1)	$	10,573,000	$	9,573,000
Subtotal					10,573,000		9,573,000

Property Loans
Scharbauer Flats Apartments	June 2020	January 2023 (2)	LIBOR + 2.85%	$	24,160,000	$	7,637,988
Oasis at Twin Lakes	July 2020	August 2023 (2)	LIBOR + 2.50% (1)		27,704,180		4,542,507
Centennial Crossings	August 2020	September 2023 (2)	LIBOR + 2.50% (1)		24,250,000		6,815,740
Hilltop at Signal Hills	January 2021	August 2023 (2)	SOFR + 3.07% (1)		21,197,939		10,878,049
Legacy Commons at Signal Hills	January 2021	February 2024 (2)	SOFR + 3.07% (1)		32,233,972		15,985,341
Osprey Village	July 2021	August 2024 (2)	SOFR + 3.07% (1)		25,500,000		24,500,000
Willow Place Apartments	September 2021	October 2024 (2)	SOFR + 3.30% (1)		21,351,328		20,351,328
Magnolia Crossing (3)	December 2021	December 2022 (2)	SOFR + 6.50% (1)		14,500,000		847,606
Subtotal					190,897,419		91,558,559

Equity Investments
Vantage at Hutto	November 2020	N/A	N/A	$	11,233,000	$	4,833,670
Vantage at San Marcos (4)	November 2020	N/A	N/A		9,914,529		8,943,914
Vantage at Loveland	April 2021	N/A	N/A		16,329,000		1,308,260
Vantage at Fair Oaks	June 2021	N/A	N/A		11,011,245		634,381
Vantage at McKinney Falls	December 2021	N/A	N/A		11,431,272		3,571,068
Subtotal					59,919,046		19,291,293

Bond Purchase Commitments
CCBA Senior Garden Apartments	July 2020	Q3 2022 (5)	4.50%	$	3,807,000	$	3,807,000
Anaheim & Walnut	September 2021	Q3 2024 (5)	4.85%		3,900,000		3,900,000
Subtotal					7,707,000		7,707,000

Total Commitments				$	482,592,088	$	276,325,887

(1)

The variable index interest rate component is subject to a floor.

(2)

The borrower may elect to extend the maturity date to for a period ranging between six and twelve months upon meeting certain conditions, which may include payment of a non-refundable extension fee.

(3)

The remaining loan commitment will be used to cover debt service over the twelve month term of the property loan.

(4)

The property became a consolidated VIE effective during the fourth quarter of 2021 (Note 5). A development site has been identified for this property but construction had not commenced as of March 31, 2022.

(5)

This is the estimated closing date of the associated bond purchase commitment.

Construction Loan Guarantees

The Partnership has entered into guaranty agreements for bridge loans related to certain investments in unconsolidated entities. The Partnership will only have to perform on the guarantees if a default by the borrower were to occur. The Partnership has not accrued any amount for these contingent liabilities because the likelihood of guaranty claims is remote. The following table summarizes the Partnership’s maximum exposure under these guaranty agreements as of March 31, 2022:


Borrower	Guarantee Maturity	Maximum Balance Available on Loan		Loan Balance as of March 31, 2022		Partnership's Maximum Exposure as of March 31, 2022		Guarantee Terms
Vantage at Stone Creek	2023	$	34,222,000	$	34,222,000	$	17,111,000	(1)
Vantage at Coventry	2023		34,536,000		34,536,000		17,268,000	(1)

(1)

The Partnership’s guaranty is for 50% of the loan balance. The Partnership has guaranteed up to 100% of the outstanding loan balance upon the occurrence of fraud or other willful misconduct by the borrower or if the borrower voluntarily files for bankruptcy. The guarantee agreement requires the Partnership to maintain a minimum net worth of not less than $100.0 million and maintain liquid assets of not less than $5.0 million. The Partnership was in compliance with these requirements as of March 31, 2022. The Partnership has also provided indemnification to the lender for various costs including environmental non-compliance and remediation during the term.

Other Guarantees and Commitments

The Partnership has entered into guaranty agreements with unaffiliated entities under which the Partnership has guaranteed certain obligations of the general partners of certain limited partnerships upon the occurrence of a “repurchase event.” Potential repurchase events include LIHTC tax credit recapture and foreclosure. The Partnership’s maximum exposure is limited to 75% of the equity contributed by the limited partner to each limited partnership. No amount has been accrued for these guarantees because the likelihood of repurchase events is remote. The following table summarizes the Partnership’s maximum exposure under these guaranty agreements as of March 31, 2022:


Limited Partnership(s)	End of Guaranty Period	Partnership's Maximum Exposure as of March 31, 2022
Ohio Properties	2026	$	2,661,066
Greens of Pine Glen, LP	2027		1,854,212