SAN FRANCISCO, CA - Goodwin Procter LLP, one of the nation's leading law firms, today announced the successful culmination of its efforts in helping AvalonBay Communities acquire funding through a State of California bond allocation considered to be one of the largest of its kind in California history. As developer's counsel, Goodwin Procter represented AVB in connection with the issuance of $10 million in tax-exempt multifamily housing revenue bonds and the remarketing of $116 million in tax-exempt and $9 million in taxable multifamily housing revenue bonds. The law firm helped AVB secure a letter of credit from Bank of America, N.A. in the amount of $135 million to provide credit enhancement and liquidity support for the bonds in addition to aiding in the structuring of the joint venture development partnership between AVB and Millennium Partners.
This transaction represents AVB's largest bond financing ever closed. Proceeds from the sale of the Bonds will be loaned to AVB to finance construction of a multifamily residential project known as Avalon Walnut Creek at Contra Costa Centre in Contra Costa, California. The Project is a residential component of a larger $400 million mixed-use development known as the Contra Costa Centre Transit Village. It is located adjacent to the Pleasant Hill Bay Area Rapid Transit station.
The Bay Area Rapid Transit (BART), the County of Contra Costa, and its Redevelopment Agency felt strongly about developing the Avalon Walnut Creek transit village. Contra Costa County first filed an application with the State to issue bonds. The bonds were then sold on the open market with the proceeds being loaned to AVB to begin construction of the development.
The Avalon Walnut Creek at Contra Costa Centre Project includes 422 residential apartments, of which 20 percent will be offered to "very low income tenants" – tenants making no greater than 50 percent of the area median income. The development is also expected to consist of a 3,367-space multi-story parking garage for BART users, approximately 35,000 square feet of retail space, 270,000 square feet of commercial office space, 100 condominium units, 19,400 square feet dedicated to conference facilities, and an additional 648-space parking garage. AVB anticipates completion of the project in 2010.
"The transit village will show the rest of California that providing adequate public infrastructure and services that keep pace with growth is the best way to increase density within transit rich locations. By creating a public/private partnership and engaging the local community, Contra Costa Centre and the BART Transit Village are providing over 2,800 residential units and employment for 6,500 people; and the Pleasant Hill BART station is serving 6,500 BART customers daily," said Contra Costa County Supervisor, Susan Bonilla.
Led by partner Tuan A. Pham, the Goodwin Procter legal team representing AVB was comprised of partners and associates from the firm's national Real Estate Practice Group, including Phillip H. Ebling, Christopher R. Maratas, and Lilly E. Shilton. "We thoroughly enjoyed counseling AVB as it secured Bank of America as the credit enhancer and went to the bond market at advantageous tax-exempt interest rates," said Pham. "Our efforts were particularly gratifying since this was one of the largest multifamily housing bond allocations ever received by a private sector developer from the State of California, and the largest bond deal that AVB has ever completed." Typically, CDLAC, the State's bond allocation committee, will cap its allocations at $30 million per development.
"Our Public/Private Development Team is extremely proud to have represented AvalonBay Communities, Inc. Our national real estate resources contributed greatly to this project and our network of highly skilled real estate attorneys played an important role in making this project a reality," said Lewis G. Feldman, the Team's leader.
In recent years, Goodwin Procter has structured and executed public/private development financing in excess of $20 billion, has counseled clients on REIT and REIT M&A deals totaling more than $70 billion, has counseled clients on real estate investment transactions valued at more than $20 billion and has provided advice on the formation of real estate and related funds with private equity capital in excess of $20 billion.
Source: Business Wire