Since 2002, Consortium Capital has assisted its partners in being awarded over $1 billion in New Markets Tax Credit (NMTC) allocation. These allocation awards have translated into more than $2 billion of real estate development in low income communities. Consortium Capital uses its unique relationships with both national and local Community Development Entities (CDEs), investment banks, lenders, professionals, and developers to help structure and close financing for real estate projects that have a large impact in highly distressed low income communities. Consortium Capital has partnered with many institutional investors in NMTC projects including US Bank, Sovereign Bank, Wells Fargo, Key Bank, Bank of America, Chevron USA, Morgan Stanley, Sun Trust, TD Bank, JP Morgan Chase, Capital One, and Goldman Sachs.

The New Markets Tax Credit

Created by the Community Renewal Tax Relief Act of 2000, it is administered by both the CDFI Fund and the IRS. It is designed to bring much needed capital to underserved low income communities throughout the United States by allowing CDEs to use their knowledge and expertise to invest in high impact businesses and real estate projects.

The program provides investors a 39% tax credit over 7 years. The monetization of this credit results in substantial equity (or below market interest rates) being provided to the project, which, in turn, ultimately benefits the surrounding low income community by acting as an economic catalyst by creating jobs and providing much needed community services. Although structuring transactions with NMTCs is complicated, if debt dollars are leveraged, the use of this subsidy can net developers/non-profits an additional 10-20% in equity to their projects.

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