Rental Assistance Demonstration (RAD) Projects
Increasingly, the revitalization of public housing developments includes the conversion of public housing to project-based Section 8, often through HUD’s Rental Assistance Demonstration (RAD) program. RAD was introduced in 2012 to give housing authorities a tool to preserve and improve public housing properties and to address the substantial backlog of deferred maintenance.
D+B provides feasibility analyses for RAD conversions and advises public housing authorities (PHAs) throughout the RAD conversion process. We assess RAD’s impact on PHAs’ financial operations, evaluating the scope of RAD conversions relative to an overall portfolio as well as identifying existing and potential sources of revenues. D+B offers board and staff trainings in RAD for PHAs that are new to redevelopment, beginning to undertake master planning or asset repositioning, or unfamiliar with the RAD program.
D+B’s RAD-related experience includes both development work and consulting services. Our development work is in Yonkers, New Rochelle, Schenectady, and Glens Falls, New York, and Jacksonville, Florida. Our consulting services are for projects in Kentucky (Lexington, Louisville), Georgia (Columbus), Pennsylvania (Philadelphia), North Carolina (Durham, Greensboro), Texas (Port Arthur), and New York (Albany). Since 2015, D+B has advised the Philadelphia Housing Authority on closing five RAD transactions (rehabilitation and new construction), with a total of 371 units.
Other RAD consulting projects include the following:
- As financial consultant to the Lexington (Kentucky) Housing Authority (LHA) in 2014, D+B advised on the closing of one of the first RAD public housing conversions, at Centre Meadows (formerly Pimlico Apartments). The conversion included substantial rehabilitation of 206 multifamily units; project financing combined tax-exempt bonds collateralized by an FHA 221(d) (4) mortgage with LHA funds. Construction was completed in March 2016.
- As RAD consultant to the Housing Authority of Columbus, Georgia (HACG), D+B assisted with the RAD conversion of four scattered sites comprising 582 units. Financing included noncompetitive tax-exempt bond financing, 4% credits, first mortgage financing, and HACG subordinate financing. Construction was completed in 2018, and qualified occupancy has been achieved. Work on HACG’s portfolio conversion continues. HACG has three conventional public housing sites and two new-construction mixed-finance developments to convert to RAD.