Affordable Housing Case Study:
Castleview Apartments and the Good Samaritan Clinic
Rochester, MN
Homelessness is not just an urban problem. Increasingly, rural areas are struggling to manage a homeless population without the programs and infrastructure that metropolitan areas with higher densities of services are able to provide.
In order to address this problem in the small city of Rochester, MN, the Salvation Army retained Ponterre Group as their Development Consultant to raise the funds necessary to construct Castleview Apartments and the Good Samaritan Medical and Dental Clinic. Castleview Apartments, the first of its kind in Rochester, is a 32-unit building comprised entirely of efficiency apartments; Ponterre consultants worked closely with the client, Olmstead County and the City of Rochester to evaluate market conditions, the demographics of the area and the current homeless need, along with availability of funding, to determine the unit mix best suited for the development. Sixteen of the units are reserved for residents with either or both a disability and long-term homeless status. The remaining units are rented to individuals with very low incomes.
In additional to the affordable housing component, Castleview’s unique model includes a medical and dental clinic on the first floor, making this a mixed-use project. The Good Samaritan Medical and Dental Clinic is a partnership with the prestigious Mayo Clinic and Rochester area dentists to provide accessible care to low income individuals, uninsured individuals, and underinsured individuals. The clinic is available to both Castleview tenants and Olmstead County residents.
Capital development/construction costs totaled $6,452,500. Ponterre Group consultants identified, pursued and secured this dollar amount through the following sources:
- MHFA Low Income Housing Tax Credits $5,622,179
- Greater Minnesota Housing Fund $400,000
- Salvation Army contribution $300,000
- HUD Supportive Housing Program $130,321
Consultants manage both preparation of financial proformas that ensure the project will cash flow, and the funding application processes that go hand-in-hand with retaining finances.
Castleview Apartments are permanent supportive housing and utilize an integrated services approach, meaning services are offered on site to residents who may need more hands-on case management to achieve stability. Ponterre’s expertise is not limited to capital financing; operating and service dollars are just as critical to affordable housing as the construction budget. Consultants created and secured the following financial package to ensure the project is funded for the foreseeable future:
Operating (Annual)
- Group Residential Housing $669 per unit per month
- HUD (Shelter + Care) $520 per unit per month
- Salvation Army $35,000
Services (Annual)
- HUD Supportive Housing Program $81,500
Complex projects such as Castleview, with multiple sources of financing and many levels of approval processes to navigate, not only require a high level of technical expertise, but also an unwavering commitment to the project and the client’s goals. Ponterre consultants demonstrated their dedication to the project over the course of four years – from concept to completion.
"Melodie Bridgeman and Becky Landon of Ponterre were instrumental in guiding Salvation Army staff through the complexities of the planning phases, the acquisition of funding and the construction processes involved in the project. They provided complete project management over the course of several years, kept staff well-informed throughout the process, and helped us overcome several hurdles, including tax status issues."
- Louise Simons, Salvation Army Northwest Division
