Abstract:
This case study explores the factors that are important in analyzing the health and soundness of a project in a growing nonprofit housing company with multiple program areas. A new loan officer at a community development financial institution must decide whether to recommend approval of an application by Greater Miami Neighborhoods (GMN) for financing the construction of a mixed-income condo building in downtown Miami. GMN recently has become the largest nonprofit developer and owner of low-income housing in Florida, with fifty-eight affiliates and subsidiary legal entities responsible for the development, preservation, and management of more than 6,000 units of low-cost rental and for-sale homes. It has grown by taking on new and far-flung real estate projects--including Lighthouse Bay, a 1,100-unit apartment complex in Jacksonville, Florida--and acquiring its own property management and construction companies. But the organization has also experienced a few setbacks including a rejection in the final round of a large loan from the MacArthur Foundation.
Learning Objective:
This case study explores the factors that are important in analyzing the health and soundness of a project in a growing nonprofit housing company with multiple program areas. It is up to the inexperienced loan officer and readers of the case study to find ways to assess the situation and decide whether GMN has been experiencing mere growing pains or a more serious organizational illness.
