Connecticut Housing Agency Plans Sale

Mortgage & Real Estate









SourceMedia’s Partner Insights program enables marketers to deliver relevant content and insights directly to the National Mortgage News audience via SourceMedia’s digital media platforms. Partner Insights content is produced by the marketer. To find out more, contact Tim Murphy at or 212-803-8760.

The Connecticut Housing Finance Authority‘s plans to sell $97.5 million of housing mortgage financing this week in transactions that include two private placements.

The sale will include a $58.1 million public offering of Series 2014 F1 tax-exempt and F2 taxable bonds; $15 million of Series 2014 E taxable bonds to be placed directly with the Federal Home Loan Bank of Seattle; and $24.4 million of Series 2014F3 tax-exempt bonds, placed directly with Bank of America.

According to vice president for finance Hazim Taib, the sale will provide funding to five multifamily developments and will enable Rocky Hill-based CHFA to preserve more than 390 affordable rental units.

In collaboration with the state Department of Housing, other state and municipal agencies as well as private investors, the sale and lending are expected to generate about $110 million of new economic activity along with 840 new jobs in the state, according to the Department of Economic and Community Development.

“This is phase two of providing funding to affordable multifamily rental housing in calendar year 2014,” said Taib.

Citi is lead manager. In May, Citi was the senior bookrunner as CHFA sold $62 million, of which $12 million was directly placed with Bank of America. That financing resulted in the financing of six multifamily developments and the preservation of 662 affordable rental units.

Taib said direct placements benefit the agency.

“Depending to where you want to be on the yield curve, direct placement has a competitive advantage over a public offering due to cost and ease of execution,” Taib said.

For example, he said, CHFA last year placed $350 million with the Federal Home Loan Bank of Seattle.

Moody’s Investors Service rated the F1 and F2 bonds Aaa.

“The rating is based on the very high overcollateralization of assets to liabilities, very strong program cash flows, a high percentage of government-insured loans and support from the state through the housing mortgage capital reserve fund,” said Moody’s.

Credit strengths, according to Moody’s, include a program asset-to-debt ratio of 132% and a net revenue at 9.9% of total revenue as of Dec. 31, 2013.

“The strong financial position of the program allows the program cash flows to withstand various stressful projections,” said Moody’s.

The ratings agency also cited a pool of roughly $2.6 billion of single family loans diversified throughout Connecticut, consisting of $2 billion of whole loans and $530 million of loans securitized with Guaranteed National Mortgage Account and Federal National Mortgage Association funding — so-called Ginnie Maes and Fannie Maes, respectively.

Hawkins, Delafield Wood LLC, Edwards Wildman Palmer LLP and Hardwick Law Firm are co-bond counsel. Kutak Rock LLP is representing the underwriters.

Leave a Reply