atax-8k_20211108.htm
false 0001059142 0001059142 2021-11-08 2021-11-08

 

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

FORM 8-K

 

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): November 8, 2021

 

AMERICA FIRST MULTIFAMILY INVESTORS, L.P.

(Exact name of Registrant as Specified in Its Charter)

 

 

Delaware

000-24843

47-0810385

(State or Other Jurisdiction

of Incorporation)

(Commission File Number)

(IRS Employer

Identification No.)

 

 

 

14301 FNB Parkway, Suite 211,

Omaha, Nebraska

 

68154

(Address of Principal Executive Offices)

 

(Zip Code)

Registrant’s Telephone Number, Including Area Code: (402) 952-1235

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

 

Trading Symbol(s)

 

Name of each exchange on which registered

Beneficial Unit Certificates representing assignments of limited partnership interests in America First Multifamily Investors, L.P.

 

ATAX

 

The NASDAQ Stock Market, LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

 


 

Item 7.01.  Regulation FD Disclosure.

On November 8, 2021, America First Multifamily Investors, L.P. (the “Partnership”) is providing the information which is included in this Current Report on Form 8-K (including Exhibit 99.1 hereto) with respect to supplemental financial information for the Partnership on the Partnership’s website, www.ataxfund.com.  This information includes selected financial and operations information from the third quarter of 2021 and does not represent a complete set of financial statements and related notes prepared in conformity with generally accepted accounting principles (“GAAP”).  Most, but not all, of the selected financial information furnished herein is derived from the Partnership’s consolidated financial statements and related notes prepared in accordance with GAAP and management’s discussion and analysis of financial condition and results of operations included in the Partnership’s reports on Forms 10-K and 10-Q.  

The information included in this Current Report on Form 8-K (including Exhibit 99.1 hereto) that is furnished pursuant to this Item 7.01 shall not be deemed to be “filed” for the purposes of Section 18 of the Securities and Exchange Act of 1934, as amended, or otherwise subject to the liabilities of that Section or Sections 11 and 12(a)(2) of the Securities Act of 1933, as amended.  The information contained in this Item and in the accompanying Exhibit 99.1 shall not be incorporated by reference into any filing of the Partnership, whether made before or after the date hereof, regardless of any general incorporation language in such filing, unless expressly incorporated by specific reference into such filing.

 

 

Item 9.01.  Financial Statements and Exhibits.

(a) Not applicable.

(b) Not applicable.

(c) Not applicable.

(d) Exhibits.

 

Exhibit

Number

 

Description

99.1

 

Supplemental information furnished November 8, 2021.

104

 

Cover Page Interactive Data File (embedded within the Inline XBRL document)

 


 

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

 

 

AMERICA FIRST MULTIFAMILY INVESTORS, L. P.

 

 

 

 

Dated: November 8, 2021

  

By:

/s/ Jesse A. Coury

 

 

 

Printed: Jesse A. Coury

 

 

 

Title: Chief Financial Officer

 

atax-ex991_6.htm

 

Exhibit 99.1

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Supplemental Financial Report for the

Quarter Ended September 30, 2021

 


 

 

 

AMERICA FIRST MULTIFAMILY INVESTORS, L.P.

All statements in this document other than statements of historical facts, including statements regarding our future results of operations and financial position, business strategy and plans and objectives of management for future operations, are forward-looking statements. When used, statements which are not historical in nature, including those containing words such as “anticipate,” “estimate,” “should,” “expect,” “believe,” “intend,” and similar expressions, are intended to identify forward-looking statements. We have based forward-looking statements largely on our current expectations and projections about future events and financial trends that we believe may affect our business, financial condition and results of operations. This document may also contain estimates and other statistical data made by independent parties and by us relating to market size and growth and other industry data. This data involves a number of assumptions and limitations, and you are cautioned not to give undue weight to such estimates. We have not independently verified the statistical and other industry data generated by independent parties contained in this supplement and, accordingly, we cannot guarantee their accuracy or completeness. In addition, projections, assumptions and estimates of our future performance and the future performance of the industries in which we operate are necessarily subject to a high degree of uncertainty and risk due to a variety of factors, including those described under the headings “Item 1A Risk Factors” in our 2020 Annual Report on Form 10-K for the year ended December 31, 2020. These forward-looking statements are subject to various risks and uncertainties and America First Multifamily Investors, L.P. (“ATAX” or “Partnership”) expressly disclaims any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Most, but not all, of the selected financial information furnished herein is derived from the America First Multifamily Investors, L.P.’s consolidated financial statements and related notes prepared in conformity with generally accepted accounting principles in the United States of America (“GAAP”) and management’s discussion and analysis of financial condition and results of operations included in the Partnership’s reports on Forms 10-K and 10-Q. The Partnership’s annual consolidated financial statements were subject to an independent audit, dated February 25, 2021.

Disclosure Regarding Non-GAAP Measures

This document refers to certain financial measures that are identified as non-GAAP. We believe these non-GAAP measures are helpful to investors because they are the key information used by management to analyze our operations. This supplemental information should not be considered in isolation or as a substitute for the related GAAP measures.

Please see the consolidated financial statements we filed with the Securities and Exchange Commission on Forms 10-K and 10-Q.  Our GAAP consolidated financial statements can be located upon searching for the Partnership’s filings at www.sec.gov.

 

 

 

 


 

 

 

PARTNERSHIP FINANCIAL INFORMATION

 

TABLE OF CONTENTS

 

Pages

Letter from the CEO

4

Quarterly Fact Sheet

6

Financial Performance Trend Graphs

7-12

Other Partnership Information

13

Partnership Financial Measures

14-15

 

 

 

 

 

 

 

 

 


 

 

 

AMERICA FIRST MULTIFAMILY INVESTORS, L.P.

LETTER FROM THE CEO

 

I am very pleased with the operating results for our third quarter, as we continued to execute on our construction lending commitments and realized another gain on the redemption of one of our Vantage investments.

 

We reported the following financial results as of and for the three months ended September 30, 2021:

 

 

Total revenues of $17.7 million

 

Net income, basic and diluted, of $0.19 per Beneficial Unit Certificate (“BUC”)

 

Cash Available for Distribution (“CAD”) of $0.22 per BUC

 

Total assets of $1.3 billion

 

Total Mortgage Revenue Bond (“MRB”) and Governmental Issuer Loan (“GIL”) investments of $909.6 million

We reported the following notable transactions during the third quarter of 2021:

 

 

Completed a public offering of 5,462,500 BUCs for net proceeds of $31.2 million after payment of underwriting discounts, commissions and direct expenses.

 

Extended the maturity of the Partnership’s $50 million acquisition line of credit with Bankers Trust Company to June 2023 and converted to a secured facility.

 

Received proceeds from the sale of Vantage at Bulverde in Texas totaling $18.9 million on the Partnership’s initial investment commitment of $8.6 million in March 2018.

 

Redemptions of four MRBs with total principal of $32.4 million. Two of the MRBs were redeemed at a premium totaling $1.8 million.

 

Advanced funds for six GIL investment commitments totaling $35.6 million and four related property investment commitments totaling $14.4 million. This includes GIL and property loan commitments for two new projects totaling $131.9 million closed in the third quarter. The commitments will provide construction financing for affordable multifamily properties in Florida and Georgia. The Partnership has funded $7.6 million of these commitments as of September 30, 2021.

 

Advanced funds for two MRB investment commitments totaling $4.0 million and one taxable MRB totaling $1.0 million.

 

Made equity investments in three unconsolidated entities totaling $6.1 million.

We continue to see consistent operating results from our MRB investments associated with affordable multifamily properties, with all such MRBs being current on contractual principal and interest payments as of September 30, 2021 and having received no requests for forbearance to date.

 

Our investments in student housing properties – the Live 929 Apartments MRB, The 50/50 MF Property and the Suites on Paseo MF Property - have completed Fall 2021 lease-up. As of September 30, 2021, Live 929 Apartments is 95% occupied, The 50/50 MF Property is 88% occupied, and the Suites on Paseo MF Property is 97%. We have granted forbearance on principal repayments on the Live 929 Apartments MRB through the end of 2021. Both of our owned MF properties are meeting all direct mortgage and operating obligations with cash flows from operations.

 

 

4

 


 

 

 

The borrower on the Provision proton therapy center MRB filed for Chapter 11 bankruptcy in the fourth quarter of 2020 and we continue to assess forbearance and restructuring options along with the other senior bondholders.

 

We and our unitholders continue to benefit from our Vantage investments. We received proceeds from the sale of Vantage at Bulverde in Texas totaling $18.9 million on the Partnership’s initial investment commitment of $8.6 million. We continue to see good leasing activity at the six Vantage properties where construction is complete, with four of these properties having achieved over 90% physical occupancy and two over 85% physical occupancy by the end of September. We have not experienced any material supply chain or labor disruptions on the six Vantage properties under construction. As we have seen in the past, the Vantage group, as the managing member of each property-owning entity, will position a property for sale upon stabilization. 

 

We completed a public offering of 5,462,500 BUCs for net proceeds of $31.2 million in September and we are focused on deploying this capital into accretive investments.

 

Affiliates of Greystone & Co. Inc. continues to assist in our growth by introducing new investment opportunities. An affiliate of Greystone has forward committed to purchase seven of our GIL investments to date. In addition, through October 2021, we have closed MRB commitments totaling $45.9 million related to projects referred by a Greystone affiliate, demonstrating Greystone’s continuing support for ATAX’s operations.

 

We will continue to strategically work with our strongest sponsors on new investment opportunities where traditional sources of capital may not currently be available and to develop new relationships, particularly with those sponsors that are existing clients of Greystone and its affiliates. 

 

Thank you for your continued support of ATAX!

 

Kenneth C. Rogozinski

Chief Executive Officer

 

 

5

 


 

 

 

THIRD QUARTER 2021 FACT SHEET

 

PARTNERSHIP DETAILS

 

ATAX was formed for the primary purpose of acquiring a portfolio of MRBs that are issued to provide construction and/or permanent financing of affordable multifamily residential and commercial properties.  We also invest in GILs, which are similar to MRBs, to provide construction financing for affordable multifamily properties.  We continue to expect most of the interest paid on the MRBs and GILs to be excludable from gross income for federal income tax purposes.  In addition, we have invested in equity interests in multifamily, market rate properties throughout the U.S. We have also acquired interests in multifamily properties (“MF Properties”) to position ourselves for future investments in MRBs issued to finance these properties or to operate the MF Properties until their “highest and best use” can be determined.  We continue to pursue a business strategy of acquiring additional MRBs and GILs on a leveraged basis, and other investments.

 

(As of September 30, 2021)

 

 

 

Symbol (NASDAQ)

 

 

ATAX

 

Most Recent Quarterly Distribution

 

$

0.11

 

Unit Price

 

$

5.96

 

 

 

 

 

 

 

 

 

 

 

BUCs Outstanding

 

 

65,930,903

 

Market Capitalization

 

$

392,948,182

 

52-week BUC price range

 

$3.67 to $7.07

 

 

 

 

 

 

 

 

 

 

 

Partnership Financial Information for Q3 2021

($’s in 000’s, except per BUC amounts)

 

 

 

9/30/2021

 

12/31/2020

 

 

 

 

 

 

Total Assets

$1,284,501,519

 

$1,175,248

 

Leverage Ratio1

66%

 

67%

 

 

 

 

 

 

 

Q3 2021

 

YTD 2021

 

 

 

 

 

 

Total Revenue

$17,682

 

$48,476

 

Net Income

$12,988

 

$30,246

 

Cash Available for Distribution

  (“CAD”)2

$13,305

 

$30,311

 

Distributions Declared per BUC3

$0.11

 

$0.31

 

 

 

 

 

 

 

 

 

 

 

1

Our overall leverage ratio is calculated as total outstanding debt divided by total assets using cost adjusted for paydowns and allowances for MRBs, Governmental Issuer Loans, property loans, taxable MRBs and taxable GILs, and initial cost for deferred financing costs and MF Properties.

2

Management utilizes a calculation of Cash Available for Distribution (“CAD”) to assess the Partnership’s operating performance. This is a non-GAAP financial measure and a reconciliation of our GAAP net income (loss) to CAD is provided on page 14 of the Supplement herein.

3

The most recent distribution was paid on October 29, 2021 for BUC holders of record as of September 30, 2021. The distribution is payable to BUC holders of record as of the last business day of the quarter end and ATAX trades ex-dividend one day prior to the record date, with a payable date of the last business day of the subsequent month.

 

6

 


 

 

ATAX ASSET PROFILE

 

 

7

 


 

 

 

ATAX MORTGAGE INVESTMENT PROFILE

 

 

 

(1)

Mortgage Investments include the Partnership’s Mortgage Revenue Bonds, Governmental Issuer Loans and Property Loans that share a first mortgage lien with the Governmental Issuer Loans.

 

8

 


 

 

 

ATAX DEBT AND EQUITY PROFILE

 

 

 

9

 


 

 

 

DEBT FINANCING, NET ($’s in 000’s)

 

 

 

 

INTEREST RATE SENSITIVITY ANALYSIS (1)

 

Description

 

- 25 basis points

 

+ 50 basis points

 

+ 100 basis points

 

+ 150 basis points

 

+ 200 basis points

TOB Debt Financings

 

$838,855

 

$(1,585,476)

 

$(3,170,952)

 

$(4,756,429)

 

$(6,341,905)

TEBS Debt Financings

 

128,554

 

(257,107)

 

(514,215)

 

(771,322)

 

(1,028,430)

Other Investment Financings

 

-

 

(203,692)

 

(753,692)

 

(1,303,692)

 

(1,853,692)

Variable Rate Investments

 

(109,354)

 

456,062

 

1,547,401

 

2,826,714

 

4,165,350

Total

 

$858,055

 

$(1,590,213)

 

$(2,891,458)

 

$(4,004,729)

 

$(5,058,677)

 

 

(1) Represents the change over the next 12 months assuming an immediate shift in rates and management does not adjust its strategy in response.

 

10

 


 

 

TOTAL REVENUE & GAIN ON SALE TRENDS

 

 

11

 


 

 

 

OPERATING EXPENSE TRENDS

 

 

 

 

 

 

Since October 1, 2019, the ratio of “Salaries and benefits” and “General and administrative” expenses to Total assets has averaged approximately 0.31% per quarter.

 

Salaries and benefits expense for the three months ended September 30, 2019 includes approximately $2.7 million of expense related to the accelerated vesting of restricted units upon the change in control of ATAX’s general partner on September 10, 2019.


OTHER PARTNERSHIP INFORMATION

 

 

 

 

Corporate Office:

 

 

Transfer Agent:

 

14301 FNB Parkway

 

 

American Stock Transfer & Trust Company

Suite 211

 

 

59 Maiden Lane

Omaha, NE  68154

 

 

Plaza Level

Phone:

402-952-1235

 

New York, NY 10038

Investor & K-1 Services:

855-4AT-AXK1

 

 

Phone: 718-921-8124

Web Site:

www.ataxfund.com

 

 

888-991-9902

K-1 Services Email:

k1s@ataxfund.com

 

 

 

Ticker Symbol:

ATAX

 

 

 

 

Corporate Counsel:

 

Independent Accountants:

Barnes & Thornburg LLP

 

PwC

11 S. Meridian Street

 

1 North Wacker Drive

Indianapolis, IN 46204

 

Chicago, Illinois 60606

 

 

 

Board of Managers of Greystone AF Manager LLC:

(acting as the directors of ATAX)

 

 

 

Stephen Rosenberg

 

Chairman of the Board

Curtis A. Pollock

 

Manager

Jeffrey M. Baevsky

 

Manager

Drew C. Fletcher

 

Manager

Steven C. Lilly

 

Manager

W. Kimball Griffith

 

Manager

Deborah A. Wilson

 

Manager

 

 

 

Corporate Officers:

Chief Executive Officer – Kenneth C. Rogozinski

Chief Financial Officer – Jesse A. Coury

 

 

 

12

 


 

 

 

AMERICA FIRST MULTIFAMILY INVESTORS, L.P.

CASH AVAILABLE FOR DISTRIBUTION (CAD) AND OTHER PERFORMANCE MEASURES

 

The following table contains reconciliations of the Partnership’s GAAP net income to its CAD:

 

 

For the Three

 

 

For the Nine

 

 

Months Ended

 

 

Months Ended

 

 

September 30, 2021

 

 

September 30, 2021

 

Net income

$

12,988,384

 

 

$

30,245,918

 

Change in fair value of derivatives and interest rate derivative amortization

 

9,261

 

 

 

11,304

 

Depreciation and amortization expense

 

680,925

 

 

 

2,049,269

 

Provision for credit loss

 

-

 

 

 

900,080

 

Provision for loan loss

 

-

 

 

 

330,116

 

Amortization of deferred financing costs

 

368,829

 

 

 

823,212

 

Restricted unit compensation expense

 

570,467

 

 

 

839,551

 

Deferred income taxes

 

(42,011

)

 

 

(77,681

)

Redeemable Preferred Unit distribution and accretion

 

(717,762

)

 

 

(2,153,288

)

Tier 2 Income distributable to the General Partner

 

(534,873

)

 

 

(2,603,020

)

Bond purchase premium (discount) amortization (accretion), net of cash received

 

(17,846

)

 

 

(54,552

)

Total CAD

$

13,305,374

 

 

$

30,310,909

 

 

 

 

 

 

 

 

 

Weighted average number of BUCs outstanding, basic

 

60,646,528

 

 

 

60,637,976

 

 

 

 

 

 

 

 

 

Partnership Only:

 

 

 

 

 

 

 

Net income per BUC, basic

$

0.19

 

 

$

0.42

 

Total CAD per BUC, basic

$

0.22

 

 

$

0.50

 

Distributions declared per BUC

$

0.11

 

 

$

0.31

 

 


 

13

 


 

 

 

AMERICA FIRST MULTIFAMILY INVESTORS, L.P.

TAX INCOME INFORMATION RELATED TO BENEFICIAL UNIT CERTIFICATES

 

The following table summarizes tax-exempt and taxable income as percentages of total income allocated to the Partnership’s BUCs on Schedule K-1 for tax years 2018 to 2020. This disclosure relates only to income allocated to the Partnership’s BUCs and does not consider an individual unitholder’s basis in the BUCs or potential return of capital as such matters are dependent on the individual unitholders’ specific tax circumstances.

 

 

2020

 

2019

 

2018

Tax-exempt income

215%

 

37%

 

41%

Taxable income (loss)

-115%

(1)

63%

 

59%

 

100%

 

100%

 

100%

 

 

 

 

 

 

 

 

(1)

The taxable loss in 2020 is due primarily to net rental real estate losses that exceeded gains on sale for tax purposes during the year related to the Partnership’s investment in unconsolidated entities.

 

 

14