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BUILDING A

FOUNDATION

Midwest Housing Equity Group 2019 Annual Report


Corporate Philosophy Mission Statement:

Midwest Housing’s mission is to change lives for a better tomorrow by promoting the development and sustainability of quality affordable housing.

Vision:

Midwest Housing aspires to be the leading regional syndicator of low-income housing tax credits, recognized for its excellent track record of selecting, investing in and protecting quality real estate developments that revitalize the communities in which they are built.

Core Values:

Integrity: as fiduciaries, we are honest and up front in all of our transactions, avoiding even the appearance of impropriety or conflict of interest transactions. Stewardship: we are excellent stewards of our investments (and thus the residents), honoring our written and implicit commitments to our investors, developers, residents and communities. Excellence: we strive to be the best in the business, employing the best individuals, utilizing up-to-date processes and infrastructure, and conservative underwriting parameters. Local Presence: we are and will remain local, believing that a “boots on the ground� approach is the best way to understand and protect the developments. Employee-Focused: our employees are our strength. Recognizing that, we endeavor to provide ongoing development, training and advancement opportunities, to respect a work/life balance and to recognize and reward personal, department and company achievements.

On the Cover: Pinewood Village II, Breckenridge, Colorado


Contents Message from our President

2

MHEG Portfolio Summary

3

2019 Developments

5

Melissa’s Story

7

Equity Summary

9

Board of Directors & Committee Members

10

MHEG Staff

11


President & CEO’s Message Hello Friends! The theme of our 2019 Annual Report is Building A Foundation. A foundation’s purpose is to strengthen the home that is built upon it, to hold it together through even the worst weather. The stronger the foundation, the more the home can withstand. To me, a safe, decent and affordable home is the foundation upon which people can build a successful life. It provides safety and security, thus allowing you to focus on life’s other needs: health, nutrition, education, employment, family and achievement. Every home MHEG has helped finance, has helped to build a foundation for a family. A place to focus on school or work or just being together. In 2019, we raised over $200 million of new capital for new foundations. We invested in 44 developments, helping build 1,924 safe, decent and affordable rental homes. We are honored to be a small part of making a difference for so many. Of course, none of these accomplishments would be possible without all of our great partners. We are grateful to work with each of you to help build the foundations that create these success stories. Our investor partners are truly compassionate - they represent the best in corporate social responsibility and provide the equity capital necessary to construct the developments. Our developer partners identify communities in need, secure financing sources and put all the pieces together to get a property built. We also gratefully recognize our lending partners, contractors and property managers. It takes real teamwork to provide quality affordable housing. On the MHEG side, I want to thank our volunteer Board of Directors and Operations & Investment Committee members and our great team. I continue to say it each year because it is true, but it is an honor to work with all of you. Thank you for taking the time to read our 2019 Annual Report. We look forward to Changing Lives for a Better Tomorrow in 2020!

John J. Wiechmann President/CEO

2


2019 Portfolio Summary

20,000 units

42%

multifamily age restricted

15,000 units

18,998 units

Breakdown of Development Type

34%

single family

10%

special needs

14%

10,000 units

5,000 units

1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

MHEG TOTAL

3

ARKANSAS

COLORADO

IOWA

KANSAS

MINNESOTA

MISSOURI

Developments

590

8

13

80

151

4

26

Housing Units

18,998

288

1,178

2,773

4,318

148

1,283

Counties

210

8

9

28

50

4

22

Cities

263

8

10

35

67

4

22


Development Status operational

73%

lease-up construction disposed

17%

5%4%

Development Size

0-12 units

20%

33%

13-24 units 25+ units

47%

Development Location

59%

rural urban

5%

suburban

36%

Construction Type new

76%

rehab historic rehab

6%

18% NEBRASKA

OKLAHOMA

S. DAKOTA

TEXAS

216

74

9

9

5,663

2,682

364

353

50

31

2

6

66

43

2

6

4


2019 Developments In 2019, MHEG partnered with 34 developers to close over $175 million in equity for 44 developments, creating 1,924 affordable housing units. This included 15 age restricted developments, 23 multifamily developments, four single family home properties and two special needs housing developments. Projects ranged from an 8-unit rural deal in Kansas to a 159-unit urban deal in Colorado, representing 35 Midwest communities.

Colorado

DeAnza Redevelopment, LP Poncho Springs - 36 multifamily units Developed by: Sleeping Indian, LLC Remington I LLLP Fort Collins - 124 age restricted units Developed by: DMA Plaza Inc. Renova V LLLP Longmount and Boulder - 159 multifamily units Developed by: Thistle Communities

Iowa

CHI North Bay, LLLP Fairfield - 24 multifamily units Developed by: Community Housing Initiatives, Inc. Mill Farm Partners II, LLC Pella - 48 multifamily units Developed by: Overland Property Group

Missouri

California Apartments MO, LP California - 40 multifamily units Developed by: Southeast Holding, LLC Keeth Village Crocker, LP Crocker - 16 multifamily units Developed by: HRMS Westport Marshall, LP Marshall - 36 multifamily units Developed by: Missouri Valley Community Action Westport Village Marshall, LP Marshall - 24 age restricted units Developed by: Missouri Valley Community Action

Minnesota

The Mill Townhomes of Staples Limited Partnership Staples - 42 multifamily units Developed by: The Mill Townhomes LLC

5

Kansas

7th Day Senior Housing, LLC Kansas City - 24 age restricted units Developed by: Windy Ridge Development, LLC & Horizon Real Estate, LLC Bethel Estates of Lawrence Phase II, LP Lawrence - 42 age restricted units Developed by: Wheatland Investments, LLC Eileen’s Place, LLC Kansas City - 60 multifamily units Developed by: Vecino Bond Group LLC Epworth Senior Residences, LLC Hays - 90 age restricted units Developed by: Hays Services, LLC Fieldcrest, LLC Valley Center - 40 age restricted units Developed by: Mennonite Housing Rehabilitation, Inc. Fort Scott Lofts, LLC Fort Scott - 25 multifamily units Developed by: Flint Hills Holdings Goddard Senior Homes, LLC Goddard - 24 age restricted units Developed by: Excel Development Group Lindsborg Place LLC Lindsborg - 8 special needs units Developed by: Vintage Construction, LLC Neosho Plaza, LP Council Groves - 33 age restricted units Developed by: Tier 1 Development Group, LLC


Nebraska

Oklahoma

4834 S. 23rd Street LLC Omaha - 44 multifamily units Developed by: Arch Icon Development Corporation

Eagle Flats, LLC Elk City - 35 multifamily units Developed by: Excel Development Group

Columbus Cherry Creek, LLC Columbus - 32 multifamily units Developed by: Mesner Development Co.

Inola Villa, Limited Partnership Inola - 24 multifamily units Developed by: Green Companies Development Group, Inc.

Highlander Phase III, LLC Omaha - 60 age restricted units Developed by: Brinshore Development LLC

Lakeland Cove Senior Village, LP Eufaula - 48 age restricted units Developed by: Arzon Housing Corporation

Horizon Estates, LLC Holdrege - 18 multifamily units Developed by: Mesner Development Co.

Lindenwood Townhomes I, LLC Durant - 14 multifamily units Developed by: Express Development & Desert Ridge Investments

424 S. 24th Street, LLC Omaha - 30 multifamily units Developed by: Arch Icon Development Corporation

Laurelbrooke Estates, L.P. Wahoo - 11 single family units Developed by: Dana Point Development Corporation MRES Cedarwood Holdings, LP Omaha - 150 multifamily units Developed by: MRS Cedarwood Developer, LLC Ohio 36 Limited Partnership Omaha - 19 single family units Developed by: Holy Name Properties, Inc. Osborne View Estates, LLC Hastings - 30 multifamily units Developed by: Mesner Development Co. Victory Apartments, II - Omaha, LLC Omaha - 60 special needs units Developed by: Burlington Capital Real Estate, LLC Villas at Crystal Court III, L.L.C. South Sioux City - 36 age restricted units Developed by: Excel Development Group

Claremore Estates, LP Claremore - 54 age restricted units Developed by: Midcontinent Equity Holdings LLC

Lindenwood Townhomes II, LLC Durant - 12 multifamily units Developed by: Express Development & Desert Ridge Investments Prairie Edge, LP Fairview - 28 multifamily units Developed by: Tier 1 Development Group, LLC Sayre Community Housing, LP Sayre - 40 age restricted units Developed by: Arzon Housing Corporation Stillwater Springs, LLC Stillwater - 120 single family units Developed by: LW Development, LLC Wildwood, LLC Sayre - 12 single family units Developed by: Excel Development Group

South Dakota Technology Heights II Apartments Limited Partnership Sioux Falls - 39 multifamily units Developed by: C.R. Lloyd Associates, Inc. The Residences at Greenway Limited Partnership Sioux Falls - 42 age restricted units Developed by: Affordable Housing Solutions Inc.

Texas

OPG Canyon Lake Partners, LLC Canyon Lake - 35 age restricted units Developed by: Overland Property Group OPG Maplewood Partners II, LLC Wichita Falls - 36 multifamily units Developed by: Overland Property Group

6


Building A Foundation Melissa had lost about everything. After a string of bad luck, four accidents causing several injuries, she lost her house and was unable to work. Living in her car with her service dog Sophie, estranged from her family, sick and exhausted, Melissa was looking for a new start. She was looking for a different life. After a great deal of research, Melissa knew she wanted to move to Colorado. The outdoor activities would be good for her recovery, she just needed a place to live, a stable home that would allow her to heal and rebuild. She found Pinewood Village. Her life was about to change. Pinewood Village II was developed by the Breckenridge Housing Authority to help provide workforce housing for the resort town. The apartments are within walking distance to several stores, a pharmacy, and many employment opportunities. Public transit is also available. Moving into Pinewood II has made all the difference for Melissa, “It’s a huge relief for me, the stress. You can’t relax, we could never sleep, you’re using public restrooms.” She slept on the floor until she could afford furniture, but she was happy to have her own bathroom that was clean. Utilities are included at Pinewood, allowing Melissa to not worry about paying her electricity bill or if she’ll have heat during the winter. “I have a stable living environment that keeps me safe.

7


I know how much I need each month to pay rent.” Instead she’s been able to focus on her health and working at a nearby bank. Melissa has also found a community within her building. Neighbors who look after one another and help each other. “I love this community. I feel like I am part of it, and I have never felt that before in my life.” Her favorite things to are sit and read by the window, enjoying the beautiful views. Living at Pinewood has fulfilled her purpose of developing a better life. “It a hundred percent changed my life. Getting into this unit and getting stability. I’m very grateful. It’s humbling, it makes me have more compassion for other people.” Pinewood II consists of 45 units and was funded through MHEG Fund 42, LP. It is currently managed by Corum Real Estate Group.

“I think having a stable place to live, is key to developing a better life.” 8


Equity Summary

$2.0B

$2.2 billion

$2.5B

$1.5B

$1.0B

$500M

1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019

In 2019, MHEG raised over $235 million in equity capital. Since inception, MHEG has raised over $2.2 billion of equity capital to invest in affordable housing.

9


Board & Committees Board of Directors Barry Sandstrom - Retired President/CEO, Home Federal Bank - Chairman of the Board Dennis Brand - Chairman of the Executive Committee, BancFirst - Vice Chairman of the Board Frank Hayes - President, Hayes & Associates, L.L.C. Chris Hite - President, Sugar Creek Capital Kirk Kellner - Tri-State Regional President, Wells Fargo Dan Lonergan - Retired,Tenaska Capital Management Nicole Theophilus - Retired, West Corporation John Wiechmann - CEO/President, Midwest Housing Equity Group

Committees

Audit Committee

Budget & Compensation Committee

Frank Hayes - Hayes & Associates

Dennis Brand - BancFirst

Chris Hite - Sugar Creek Capital

Barry Sandstrom - Retired, Home Federal Bank

Kirk Kellner - Wells Fargo

Nicole Theophilus - Retired, West Corporation

Dan Lonergan - Retired, Tenaska Capital Management

Central Region Operations & Investment Committee

Northwest Region Operations & Investment Committee

Bob Arthur - Commerce Bank, N.A.

David Fisher - Midwest Housing Development Fund

Mark Dennett - INTRUST Bank, N.A.

Anthony Cerasoli - First National Bank of Omaha

Tracy Howren - UMB Bank, n.a.

Justin Horst - Pinnacle Bank

Michael Scheopner - Landmark National Bank

Randy Ilich - Colorado Federal Savings Bank

John Wiechmann - Midwest Housing Equity Group

John Wiechmann - Midwest Housing Equity Group

Northeast Region Operations & Investment Committee

South Region Operations & Investment Committee

Jennifer Cooper - Bankers Trust Tom Hanafan - Pottawattamie County Board of Supervisors Susan Whitson - First National Bank of Waverly John Wiechmann - Midwest Housing Equity Group

Brent Bates - Bank SNB Roger Beverage - Oklahoma Bankers Association Dennis Brand - BancFirst Daving King - MidFirst Bank - Tulsa Tom O’Keefe - INTRUST Bank, N.A. John Wiechmann - Midwest Housing Equity Group Mike Wynn - Mabrey Bank

10


MHEG Staff Executive Staff

John Wiechmann Chief Executive Officer & President

Becky Christoffersen Chief Investment Officer

Jordan Abboud Vice President of Asset Management

Pat Michaelis Vice President Business Development Officer Central Region

Jason Main Chief Financial Officer

Ann Burge Chief Operating Officer

Tom Stratman Vice President of Acquisitions

Andrea Frymire Scott Fitzpatrick Vice President Vice President Business Development Officer Business Development Officer South Region Northeast Region

Evan Andrews Financial Analyst

Tyler Arens Acquisitions Manager

Kelli Baker Asset Manager

Lisa Bryan Administrative Coordinator

Sara Church Asset Manager

Traci Collins Acquisitions Manager

Tracy Connor Corporate Accountant

Dustin Daugherty Construction Manager

Sammy Ehtisham Assistant Vice President of Acquisitions

Shannon Foster Accounting Manager

Steve Gross Senior Financial Analyst

Ryan Harris Acquisitions Manager

11


Brett Helt Financial Analyst Asset Stabilization

Jake Jacobsen Construction Manager

Shannon Johnson Accounting Assistant

Cindy Koster Senior Acquisitions Manager

Keely McAleer Corp. Communications & HR Administrator

Paul McDonald Senior Asset Manager

Trey Mendlik Financial Analyst

Sharita Nelson Compliance Specialist

Jennifer Niemier Closing Manager

Dana Oswald Accounting Coordinator

Shannon Powers Closing Manager Real Estate

Mike Powley Deputy Director of Operations

Amanda Raak Financial Analyst

Josh Rauner Fund Reporting Manager

Brad Reiff Acquisitions Manager

Cole Rogers Financial Analyst

Brooke Smith Senior Asset Manager

Laurie Stephenson Deputy Director of Compliance

Deb Swanson Closing Manager

Shellie Vandeman Compliance Specialist

Cindy Wieck Administrative Assistant

Joshua Yurek Director of Government Affairs

12


Midwest Housing Equity Group 515 N. 162nd Avenue, Suite 202 Omaha, NE 68118 www.mheginc.com

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