Debt Financing

The Company currently has outstanding debt financing of $112.7 million under three separate credit facilities. As of December 31, 2010, the Company's outstanding debt financing totaled approximately $95.6 million.



Debt Financing	Outstanding Debt Financing at December 31, 2011		Original Debt Financing		Year Acquired	Stated Maturity	Effective Rate ⁽¹⁾

TOB Financing	$	9,930,000	$	10,000,000	2011	July 2012	2.01	%
TOB Financing	7,810,000		7,810,000		2011	November 2012	1.70	%
TEBs Financing	94,933,000		95,810,000		2010	September 2017	2.10	%
Total Debt Financing	$	112,673,000	$	113,620,000

Debt Financing	Outstanding Debt Financing at December 31, 2010		Original Debt Financing		Year Acquired	Stated Maturity	Effective Rate ⁽¹⁾

TEBs Financing	$	95,608,000	$	95,810,000	2010	September 2017	2.21	%

⁽¹⁾ Represents the average effective interest rate, including fees, for the years ended December 31, 2011 and 2010 and excludes the effect of interest rate caps (see Note 13).

Tender Option Bond Financings

In July 2011, the Company closed a $10.0 million financing utilizing a Tender Option Bond ("TOB") structure with the Deutsche Bank ("DB"). The first TOB was structured as a securitization of the Company's $13.4 million Autumn Pines Apartments tax-exempt mortgage revenue bond. In December 2011, the Company closed a second TOB financing structure in the amount of $7.8 million with DB. The second TOB was structured as a securitization of the Company's $15.6 million GMF-Warren/Tulane Apartments and GMF-Madison apartments tax-exempt mortgage revenue and taxable mortgage revenue bonds. Under the TOB structure, the Company transferred the bonds to a custodian and trustee that provide these services on behalf of DB. The TOB trustee then issued senior floating-rate participation interests ("SPEARS"), and residual participation interests, ("LIFERS"). The SPEARS and LIFERS represent beneficial interests in the securitized asset held by the TOB trustee. The SPEARS were credit-enhanced by DB and sold through a placement agent to unaffiliated investors. The gross proceeds from the sale of the SPEARS were remitted to the Company. The LIFERS were retained by the Company and are pledged to DB to secure certain reimbursement obligations.

The TOB structures discussed above ("TOB trusts") receive all principal and interest payments on the bond. The holders of the SPEARS are entitled to receive regular payments from the TOB trusts at a variable rate established by a third party remarketing firm that is expected to be similar to the weekly Securities Industry and Financial Markets Association (“SIFMA”) floating index rate. Payments on the SPEARS will be made prior to any payments on the LIFERS held by the Company. As the holder of the LIFERS, the Company is not entitled to receive payments from the TOB trusts at any particular rate, but will be entitled to all remaining principal and interest paid on the bond after payment due on the SPEARS and payment of trust expenses including trustee, remarketing and liquidity fees. Accordingly, payments to the Company on the LIFERS are expected to vary over time.

As a result, the TOB trusts essentially provide the Company with a secured variable rate debt facility at interest rates that reflect the prevailing short-term tax-exempt rates paid by the TOB trusts on the SPEARS. Payments made to the holders of the SPEARS and the amount of trust fees essentially represent the Company's effective cost of borrowing on the net proceeds it received from the sale of the SPEARS. At closing, the rates paid on the first and second TOBs on the SPEARS was 0.09% and .16% per annum, respectively. In addition, the total fixed trust fees were 1.77% and 2.10% per annum, respectively, resulting in a total initial cost of borrowing of 1.86% and 2.26% per annum, respectively. As of December 31, 2011 the rates paid on the TOBs on the SPEARS were .20% and .18% per annum, resulting in a total cost of borrowing of 1.97% and 2.28%, respectively. The Company is accounting for these transactions as secured financing arrangements.

Tax Exempt Bond Securitization Financing ("TEBS")

As of September 1, 2010, the Partnership and its Consolidated Subsidiary ATAX TEBS I, LLC, entered into a number of agreements relating to a new long-term debt financing facility provided through the securitization of 13 tax-exempt mortgage revenue bonds owned by the ATAX TEBS I, LLC (the “Sponsor”) pursuant to the TEBS Financing. The TEBS Financing essentially provides the Partnership with a long-term variable-rate debt facility at interest rates reflecting prevailing short-term tax-exempt rates.

Effective September 1, 2010, the Partnership transferred the following bonds to ATAX TEBS I, LLC, a special purpose entity controlled by the Partnership pursuant to the TEBS Financing. The par value of the bonds included in this Financing facility as of December 31, 2011 and 2010 are also presented.



	Outstanding Bond Par Amounts
Description of Tax-Exempt
Mortgage Revenue Bonds	December 31, 2011		December 31, 2010		Financial Statement Presentation
Ashley Square	$	5,308,000	$	5,356,000	Tax-exempt mortgage revenue bond
Bella Vista	6,650,000		6,695,000		Tax-exempt mortgage revenue bond
Bent Tree	7,686,000		7,748,000		Consolidated VIE
Bridle Ridge	7,815,000		7,865,000		Tax-exempt mortgage revenue bond
Brookstone	9,490,809		9,560,871		Tax-exempt mortgage revenue bond
Cross Creek	8,634,693		8,697,032		Tax-exempt mortgage revenue bond
Fairmont Oaks	7,520,000		7,592,000		Consolidated VIE
Lake Forest	9,201,000		9,297,000		Consolidated VIE
Runnymede	10,685,000		10,755,000		Tax-exempt mortgage revenue bond
South Park	14,000,000		14,095,000		Tax-exempt mortgage revenue bond
Woodlynn Village	4,492,000		4,522,000		Tax-exempt mortgage revenue bond
Ohio Series A Bond ⁽¹⁾	14,666,000		14,708,000		Consolidated MF Property
Villages at Lost Creek	18,500,000		18,500,000		Tax-exempt mortgage revenue bond
Total	$	124,648,502	$	125,390,903

(1) Collateralized by Cresent Village, Post Woods and Willow Bend which are in consolidation (Note 3)

In order to meet Freddie Mac's underwriting requirements with respect to the multifamily apartment properties financed by these bonds, the Sponsor was required to first place eight of the Bonds into a separate custodial trust with The Bank of New York Mellon Trust Company, N.A. (the “Custodial Trust”) that issued senior and subordinated custody receipts (“Custody Receipts”) representing beneficial interests in the Bonds held in the Custodial Trust to the Sponsor. The subordinated Custody Receipts were retained by the Sponsor. The senior Custody Receipts along with the remaining five Bonds that were not placed into the Custodial Trust were then securitized by transferring these assets to the TEBS Trust sponsored by Freddie Mac in exchange for tax-exempt Class A and Class B Freddie Mac Multifamily Variable Rate Certificates (collectively, the “TEBS Certificates”) issued by Freddie Mac. The TEBS Certificates represent beneficial interests in the securitized assets held by Freddie Mac. The gross proceeds from TEBS Financing were approximately $95.8 million. After the payment of transaction expenses, the Company received net proceeds from the TEBS Financing of approximately $90.4 million. The Company applied approximately $49.5 million of these net proceeds to repay the entire outstanding principal of, and accrued interest on, its secured term loan from Bank of America.

The Class A TEBS Certificates were issued in an initial principal amount of $95.8 million and were sold through a placement agent to unaffiliated investors. The Class B TEBS Certificates were issued in an initial principal amount of $20.3 million and were retained by the Sponsor. The holders of the Class A TEBS Certificates are entitled to receive regular payments of interest from Freddie Mac at a variable rate which resets periodically based on the weekly Securities Industry and Financial Markets Association (“SIFMA”) floating index rate plus certain credit, facility, remarketing and servicing fees (the “Facility Fees”). As of closing, the SIFMA rate was equal to 0.25% and the total Facility Fees were 1.9%, resulting in a total initial cost of borrowing of 2.15%. As of December 31, 2011, the SIFMA rate was equal to 0.15% resulting in a total cost of borrowing of 2.05% on the outstanding balance on the TEBS Financing facility of $95.0 million. As of December 31, 2010, the SIFMA rate was equal to .34% resulting in a total cost of borrowing of 2.24% on the outstanding balance on the TEBS Financing facility of $95.6 million.

Payment of interest on the Class A TEBS Certificates will be made from the interest payments received by Freddie Mac from the Bonds and Senior Custody Receipts held by Freddie Mac on designated interest payment dates prior to any payments of interest on the Class B TEBS Certificates held by the Sponsor. As the holder of the Class B TEBS Certificates, the Sponsor is not entitled to receive interest payments on the Class B TEBS Certificates at any particular rate, but will be entitled to all payments of principal and interest on the Bonds and Senior Custody Receipts held by Freddie Mac after payment of principal and interest due on the Class A TEBS Certificates and payment of all Facility Fees and associated expenses. Accordingly, the amount of interest paid to the Sponsor on the Class B TEBS Certificates is expected to vary over time, and could be eliminated altogether, due to fluctuations in the interest rate payable on the Class A TEBS Certificates, Facility Fees, expenses and other factors.

Freddie Mac has guaranteed payment of scheduled principal and interest payments on the Class A TEBS Certificates and also guarantees payment of the purchase price of any Class A TEBS Certificates that are tendered to Freddie Mac in accordance with their terms but which cannot be remarketed to new holders within five business days. The Sponsor has pledged the Class B TEBS Certificates to Freddie Mac to secure certain reimbursement obligations of the Sponsor to Freddie Mac. The Company also entered into various subordination and intercreditor agreements with Freddie Mac under which the Company has subordinated its rights and remedies to the rights of Freddie Mac, as the holder of the Bonds, with respect to the taxable loans made by the Company to the owners of properties securing certain of the bonds.

The term of the TEBS Financing coincides with the terms of the assets securing the TEBS Certificates, except that the Partnership may terminate the TEBS Financing at its option on either September 15, 2017 or September 15, 2020. Should the Partnership not elect to terminate the TEBS Financing on these dates, the full term of the TEBS Financing runs through the final principal payment date associated with the securitized bonds, or July 15, 2050.

For years ended December 31, 2011 and 2010, the Company's average effective annual interest rate on borrowings under the BOA Facility, OSB Facility, TEBS Facility, and TOB Facilities was approximately 2.6% and 3.0%, respectively.

The Company's aggregate borrowings as of December 31, 2011 contractually mature over the next five years and thereafter as follows:



2012	$	18,685,000
2013	1,009,000
2014	1,083,000
2015	1,139,000
2016	2,484,000
Thereafter	88,273,000
Total	$	112,673,000