INDUSTRY/COMPANY NEWS

INDUSTRY NEWS

HUD SECRETARY ANNOUNCES NATIONAL FIRST LOOK PROGRAM TO HELP COMMUNITIES STABILIZE NEIGHBORHOODS HARD-HIT BY FORECLOSURE

9/2/10 - U.S. Housing and Urban Development (HUD) Secretary Shaun Donovan today announced an unprecedented agreement with the nation's top mortgage lenders to offer selected state and local governments, and nonprofit organizations a "first look" or right of first refusal to purchase foreclosed homes before making these properties available to private investors.

The National First Look Program is a first-ever public-private partnership agreement between HUD and the National Community Stabilization Trust (Stabilization Trust). In collaboration with national servicers, Fannie Mae, and Freddie Mac, the First Look program is intended to give communities participating in HUD's Neighborhood Stabilization Program (NSP) a brief exclusive opportunity to purchase bank-owned properties in certain neighborhoods so these homes can either be rehabilitated, rented, resold or demolished.

"This groundbreaking agreement will help rebuild neighborhoods that have been struggling with blight and declining home values due to foreclosures," said HUD Secretary Shaun Donovan. "Local communities will now get an exclusive option to buy foreclosed properties in targeted neighborhoods so they can turn the homes into affordable housing or, in some cases, tear them down. This agreement helps us level the playing field to give communities a better chance to stabilize these neighborhoods."

"The Stabilization Trust is delighted to be working with HUD Secretary Donovan on the National First Look Program," said Craig Nickerson, President of the NCST. "By serving as the operations ‘engine' behind the First Look Program, the Stabilization Trust can facilitate the transfer of more foreclosed property for participating financial institutions to local community buyers, thereby accelerating the road to neighborhood recovery."

HUD's NSP grantees, which include state and local governments and non-profit organizations, often find themselves competing with private investors for real estate-owned (REO) properties, which can hinder their efforts to stabilize neighborhoods with high foreclosure activity. With today's announcement, HUD and the Stabilization Trust, working with national servicers, Fannie Mae, and Freddie Mac, will standardize the acquisition process for NSP grantees, giving them an exclusive option to purchase foreclosed upon homes in certain targeted neighborhoods.

The Stabilization Trust pioneered the 'First Look' model to create a transparent and streamlined process to facilitate the transfer of foreclosed and abandoned properties from key financial institutions to local government housing providers. First piloted in 2008, the model has gained recognition as a critical tool for positively tipping the scale in neighborhoods hard hit by foreclosures. NSP grantees will also be aided by REOMatch™, a web-based mapping and acquisition management tool developed by the Stabilization Trust. REOMatch will assist NSP grantees easily identify REO properties and make more strategic decisions about which properties to acquire, based on real-time data on an interactive mapping platform.

The nation's leading financial institutions are participating in the National First Look Program, representing approximately 75 percent of the REO marketplace. Participating institutions include: Bank of America, Chase, Citi, Deutsche Bank, GMAC, Nationstar Mortgage, Ocwen Financial Corporation, Saxon Mortgage Services, U.S. Bank, Wells Fargo, Fannie Mae, Freddie Mac, and the Federal Housing Administration (FHA).

The National First Look Program will allow NSP grantees the exclusive opportunity to purchase available REO properties located within the defined boundaries of NSP target areas. NSP grantees will be immediately notified when a property becomes available and will have 24-48 hours to express interest in pursuing a specific property. Furthermore, these institutions will provide NSP purchasers with the opportunity to purchase REO properties at a discount their appraised value, reflecting the cost savings of a quick sale. NSP grantees may acquire these properties with the assistance of NSP funds for any eligible use.

After expressing interest in a property, the First Look Period will last approximately five to 12 business days during which the NSP Grantee will conduct inspections and establish costs to repair in anticipation of the financial institution's price offer. In the event that no NSP grantee exercises its preference to purchase an REO property during the First Look period, the financial institution will follow its normal process to sell the home on the open market.

Currently, the Federal Housing Administration (FHA) offers a complementary pilot program in which NSP grantees receive an exclusive option to purchase so-called ‘HUD Homes' at a discount prior to those homes being made available to the investor community. The FHA pilot, alongside today's agreement expands the opportunity for NSP grantees to gain access to REO properties through a national first-look standard option.

HUD's Neighborhood Stabilization Program was created to address the housing crisis, create jobs, and grow local economies by providing communities with the resources to purchase and rehabilitate vacant homes. NSP grants are helping state and local governments, as well as non-profit developers, acquire land and property; demolish or rehabilitate abandoned properties; and/or offer downpayment and closing cost assistance to low- to middle-income homebuyers. Grantees can also stabilize neighborhoods by creating "land banks" to assemble, temporarily manage, and dispose of foreclosed homes. To date, HUD has allocated nearly $6 billion in funding to state and local governments and non-profit housing developments. In the coming weeks, HUD will allocate an additional $1 billion in NSP funding, which was provided through the Dodd-Frank Wall Street Reform and Consumer Protection Act.*

Gill Group worked with KHC in 2009 to perform market studies for the entire state of Kentucky in an effort to assist them with decisions to keep, sell, rehab or demolish the foreclosed inventory. For more information, please contact Cash Gill at cash.gill@gillgroup.com or (800) 428-3320.

MISSOURI AGENCIES RECEIVE $4.4 MILLION IN HOMELESS SUPPORT

The Obama Administration announced July 7 that the US Department of Housing and Urban Development (HUD) is allocating approximately $190 million to more than 550 new projects throughout the United States that will assist thousands of individuals and families who are homeless.

The Balance of State and Continuum of Care, comprised of the 101 rural counties of Missouri, is led by Missouri Housing Development Commission and assists agencies in these areas with securing HUD funding to be used to serve the state’s homeless population. The Balance of State Continuum of Care was awarded $1.399 million in new funding for FY 2011, which will be used for the operation of permanent supportive housing, transitional housing, supportive services and Homeless Management Information Systems (HMIS).

The 14 counties of Missouri not included in the Balance of State Continuum of Care serve the more metropolitan areas of the state. These counties receive funding through their own continua, serving the St. Louis City, St. Louis County, St. Charles, Springfield, Joplin, Kansas city and St. Joseph areas. Including these continua, Missouri will receive a total of more than $4.4 million in new funding for services that target the homeless individuals and families in the state.

Gill Group currently provides appraisals, market studies and physical needs assessments for MHDC as part of their ongoing LIHTC program.

COMPANY NEWS:

Events (2010)

(January) Gill Group attended the 16^th Annual Tax Credit Developers Conference January 14^th – 15^th.

(January) Gill Group attended the Council for Affordable and Rural Housing (CARH) 2010 Mid-Year Meeting in San Francisco, CA January 24^th – 26^th.

(February) Gill Group attended the Rural Development 515 Preservation Roundtable on February 18^th with the Affordable Housing of Indiana Association in Plainfield Indiana. (March) Gill Group attended the Alabama QAP meeting in Montgomery Alabama on March 8^th and 9^th.

(March) Gill Group attended the annual board meeting of CARH on March 2^nd and 3^rd in Washington DC.

(March) Gill Group attended the Missouri Title School in Columbia Missouri on March 8^th.

(March) Gill Group attended the NH&RA conference in Miami Florida March 9^th – 14^th.

(April) Gill Group attended the National Council of Affordable Housing Analysts Mid-Year Meeting on April 7^th – 8^th in New Orleans, LA.

(April) Gill Group attended the Crittenden National Multifamily Conference on April 25 – 27^th in Las Vegas, NV.

(May) Gill Group will be attending Enterprise Community’s Buyer Seller Conference on May 11^th in Portland, ME. Cash Gill, MAI, will be giving a lecture on valuing Section 515 and other affordable housing properties.

(May) Gill Group attended MOCARH on May 12– 14^th in Lake of the Ozarks, MO.

(May) Gill Group attended the Midwest Lenders Conference and MAP training on May 17 – 19^th in Columbus, OH.

(May) Gill Group attended NH&RA’s Conference on May 20 – 21^st in Washington, DC.

(June) Gill Group attended Council for Affordable and Rural Housing’s annual conference June 13^th – 15^th in Washington, DC.

(June) Gill Group attended National Council of State Housing Agencies’ annual conference and marketplace June 23^th – 25^th in Chicago, IL.

(July) Gill Group attended NH&RAs Summer Meeting in Dana Point, CA July 21^st – 24^th

EVENTS (2009)

Gill Group attended 28 conferences throughout the United States in 2009.

GROWTH (2010):

(January) Gill Group added Jessica Waller as the Executive Marketing Assistant

(February) Gill Group added ten new employees in our marketing and operations departments

(March) Gill Group increased MAP approved staff by ten percent

(May) Peter Dion became the new Director of Business Development

(June) Gill Group added two new engineers to our engineering department

(July) Gill Group added six new market analysts

(August) Chad Gill announced that Gill Group’s insurance company services commercial property nationwide

GROWTH (2009 - Highlights):

William K. Duncan was appointed to the Missouri Real Estate Appraiser’s Commission. The Missouri Real Estate Appraisers Commission was created by the 85^th General Assembly for the purpose of certifying and licensing qualified person’s engaged in the practice of real estate appraising. The commission consists of six appraiser members and one public member. All members are appointed by the Governor of the State of Missouri.

Mike Baker was appointed to the Development Committee in RRHA of Texas.

Gill Group completed statewide market studies for the Neighborhood Stabilization Program throughout the country.

Gill Group’s Review Department increased coverage of the Section 8 HAP Contract Renewal Rent Comparability Study Reviews by two states.

OUTREACH:

Gill Group has published the following:

New York Real Estate Journal - How can low-income housing facilities translate into high profits?

New York Real Estate Journal - Up, up and away: Home mortgage interest rates and gasoline prices continue ascending.

Tax Credit Advisor - Boston MSA Market Snapshot

Tax Credit Advisor - Seattle MSA Market Snapshot

Northeast Industrial Development Resource Guide - What Appraisers Know About Investing.

Cash Gill, MAI has had the opportunity to speak on the following topics:

(Indianapolis, IN) National Council of Affordable Housing Market Analysts - Maximize Your Market: Understanding the Methodology Behind Market Studies.

(Reno, NV) Nevada Council of Affordable and Rural Housing - Don't Get Caught in the Red. New Guidelines for Audits and Inspections.

(Washington, DC) The Institute for Professional and Executive Development - Nonrecourse HUD Deals - So You Closed Your Nonrecourse HUD Deal. Now What? And Is It Really Nonrecourse?

(Arlington, VA) Council for Affordable and Rural Housing - Property Valuation: The Correct Way to Value Properties.

(New Orleans, LA) National Council of Affordable Housing Market Analysts - Affordable Housing Site Analysis

(Las Vegas, NV) Nevada Council of Affordable and Rural Housing - Auditing and Accounting Guidelines for Section 42 Low Income Housing Tax Credits.

(Washington, DC) Council for Affordable and Rural Housing - Rural Development Appraisals and Market Studies

(Miami, FL) Council for Affordable and Rural Housing - The Equity Market - Impact on Rural Housing

(Washington, DC) Council for Affordable and Rural Housing - How to Foster Affordable Green and Rural Housing Needs Assessments

(Indianapolis, IN) Affordable Housing Association of Indiana - Market Analysis – Best Ways Use Market Studies to Ensure Application Points

(Portland, ME) Enterprise Buyer/Seller Conference for RRH 515 Properties – Valuing the Product. What Is My Development Worth?

*as seen on HUD.gov