Arvada Housing Authority approves partial subordination for Legacy Senior Residences

The Arvada Housing Authority on Feb. 3 approved a resolution to partially subordinate its $840,000 loan to Legacy Arvada Partners LP to accommodate a Land Use Restriction Agreement required by the Colorado Housing and Finance Authority (CHFA) as part of low-income housing tax credit (LIHTC) financing.

City staff explained that Legacy Senior Residences is a new, 72-unit affordable community for residents 55 and older at 64th Avenue and Sheridan Boulevard. Eight units are reserved for seniors who were homeless prior to moving in; those units will receive supportive services from the city’s housing navigator, Alexa Urseta. Staff said CHFA will allocate LIHTC credits for 15 years and the property will remain affordable for a combined 40-year period (15 years under LIHTC plus 25 years under the LURA).

Miss Espinosa told commissioners CHFA requires parties with an interest in the property to agree to use-and-occupancy priorities in the IRS code and requested the housing authority’s partial subordination, which would only apply in the event of foreclosure. “The housing authority provided an $840,000 loan… the request to subordinate is low risk for the housing authority as it would only apply if the property is foreclosed,” she said.

Commissioners asked about foreclosure risk and demand for senior housing. Staff said foreclosure rates for LIHTC projects are very low (staff cited about 0.5% nationally) and that leasing has begun with expectations the community will fill and operate a wait list. Commissioner Mormon moved approval; the motion passed 7–0.

Next steps: CHFA will proceed with LURA execution and tax-credit allocation; legal and housing teams will finalize recording of the subordination agreement so financing can close.