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Commission approves $18M multifamily bond for Capstone at Covington Place despite cost overages
Summary
The State Bond Commission approved an $18 million multifamily housing revenue bond allocation for the Capstone at Covington Place project, a new 80-unit low-income building. Staff noted the project’s total development cost exceeded HUD-based thresholds and that the developer identified incremental costs.
The State Bond Commission on May 15 approved a multifamily housing revenue bond allocation of up to $18,000,000 for the Capstone at Covington Place project in Covington, a single-building new-construction development with 80 low-income units.
Staff said the project was approved under the Louisiana Housing Corporation's 2024 Qualified Allocation Plan (QAP) and that its total development cost (TDC) — about $31,400,000, or roughly $398,000 per unit — exceeds HUD-based cost containment thresholds. Staff presented the developer's cost analysis and noted that the application is over HUD limits by about $4,000,000 for one threshold and by $7,400,000 for TDC; the developer identified incremental costs of $4,470,000 and $7,500,000, respectively, with supporting details in the commission packet. Staff recommended approval after reviewing those explanations and other application materials.
Senator Morris notified the commission that he would recuse himself from items 37, 30 9, 40 and 40 1; the record reflects his recusal from item 37. Representative Reiser moved approval of item 37; Senator Barrow seconded the motion. The commission approved the allocation with no recorded roll-call tallies in the transcript.
Why it matters: The bond allocation supports 80 low-income housing units in Covington under LHC's QAP. The project’s cost overruns relative to HUD limits were explained by the developer and documented in staff materials; the commission accepted the explanations and recommended approval.
Details: Staff flagged that CDBG Prime 3 funds in the financing package are required to close by the end of the calendar year and that the developer has requested a volume cap allocation. The transcript and packet materials include the developer's cost analysis and justifications for incremental costs; these details are contained in the commission packet rather than read in full into the record.
