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| Statement |
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| For the 4 properties where construction is complete, we continue to see good leasing activity |
| The fourth quarter of 2023 was a much improved quarter for the fixed income markets and municipal bonds were no exception |
| And so we believe it's a good window of opportunity for us going into the balance of this year to try to take advantage of that |
| And again, sort of like we did during the early days of COVID, really gives us an opportunity to strengthen and expand our relationships with some of the larger affordable housing sponsors in the country because of the pressure that their historic lending relationships with those kinds of institutions might have |
| A strong performance overcame the softness earlier in the year |
| At these levels, we believe that we are well positioned to fund our current financing commitments which I will discuss later |
| But hopefully, given that it's a scarce resource, it allows more projects to receive awards of private activity volume cap and tax credits which I think is a good thing for the industry as a whole |
| We believe that getting new projects underway now, while other sponsors face significant challenges, will put us in a better position for success with our exits 3 to 5 years down the road when new supply may be limited |
| The 10-year muni-to-Treasury ratio was approximately 60%, a significant move lower from last quarter's 73% ratio level, demonstrating the recent strength of munis |
| But based on the bipartisan level of voting that we saw in the House on that and I think some of the other tax credits like the child tax credit that's included in that, what I would call, overall package of tax extenders, my hunch would be that there is favorable action by the Senate on this and something does end up getting done on that front |
| These issuances provide non-dilutive fixed-rate and low-cost institutional capital for executing our strategy |
| We will continue to work with our clients to deliver the most cost-effective capital possible, especially through the use of the Freddie Mac tax-exempt loan forward commitment, in association with our construction lending |
| And so what that really does is in the states where volume cap is a scarce resource, it allows them to allocate that over a larger number of projects and really get more bang for their buck, so to speak |
| The Bloomberg Municipal Index posted a total return of positive 6.4% for 2023 |
| And in some markets, we've seen a leveling off of the significant increases on a year-over-year basis in rents that we saw in 2021 and 2022 |
| Kenneth Rogozinski Good afternoon, everyone |
| First, I guess, do you think that's something that gets across the finish line? And if so, how would that benefit your guys' business? Kenneth Rogozinski Thanks, Chris |
| Thank you |
| So we have elected to put additional equity into those properties but we've done that selectively, in that we think we can still meet our return metrics on that additional contributed capital |
| Kenneth Rogozinski Thank you very much everyone for joining us today |
| Our book value per unit as of December 31 was, on a diluted basis, $15.17 which is an increase of $2.20 from September 30 |
| Statement |
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| We reported a negative provision for credit loss of $466,000 for the fourth quarter, largely driven by recent governmental issuer loan and property loan redemptions and a reduction in the weighted-average life of our remaining investment portfolio |
| From a market technicals perspective, while fund flows were still negative on the year at minus $15 billion, the pace slowed significantly from 2022's record $122 billion in outflows |
| 2023 ended with $376 billion of muni bond issuance, 4% lower than the previous year |
| Continued volatility in rates, the magnitude of the interest rate increases over the past 18 months, particularly in the short end of the curve and cost inflation have presented challenges to our developer clients on new transactions |
| So with the stress that that market has seen since last March with the wind-downs of Silicon Valley Bank and First Republic and Signature Bank in New York, we, from our perspective, have certainly seen a pullback in appetite for that kind of lending with our regional bank competitors |
| So it's definitely being more challenging from a JV equity investment to find deals that fit our profile and fit our return requirements |
| The analysis, based on those assumptions, shows that an immediate 200-basis point increase in rates as of December 31, that is sustained for a 12-month period, will result in a decrease of approximately $870,000 in our net interest income and CAD, or approximately $0.038 per unit |
| Our fourth quarter reported net income of $0.24 per unit includes a $10 million noncash loss that reflects the mark-to-market associated with our interest rate swap portfolio for the quarter |
| Changes in economic, business, competitive, regulatory and other factors could cause our actual results to differ materially from those expressed or implied by the projections or forward-looking statements made today |
| So the new bill that passed the House lowers that percentage from 50% to 30% |
| This is down from $1.08 billion as of September 30, primarily due to the redemption of our previous secured notes and the maturity of our M24 TEBS financing in the fourth quarter |
| As of yesterday's close, 10-year MMD is at 2.48% and 30-year MMD is at 3.62%, roughly 70 basis points lower in yield, respectively, than at the time of last quarter's call |
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