Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: TUESDAY, March 12, 1991 TAG: 9103120077
SECTION: BUSINESS PAGE: A-3 EDITION: METRO
SOURCE: GEORGE KEGLEY BUSINESS EDITOR
DATELINE: LENGTH: Medium
Michael G. Morgan, who has developed condominiums, office buildings and apartments in Connecticut, Massachusetts and Florida, proposes financing the Roanoke area projects with $19 million in tax-free revenue bonds issued by the Roanoke Redevelopment and Housing Authority.
A hearing on his application to acquire the Park Towne, Brandon Ridge, Brandon West and Colonial Yorktown apartments in Roanoke and Mount Regis Village in Salem will be held on March 25 at 12:30 p.m. at the authority office, 2624 Salem Turnpike, N.W.
As a condition for the tax exemption, Morgan will be required to set aside a portion of the apartments for low-income residents and to spend at least 15 percent of the purchase price on rehabilitation within two years.
The 692 units in five clusters are owned by a group of Chicago investors led by Peter Morris, founder of VMS Realty Partners.
Morgan said he has an agreement for the Mount Regis units "and we're fairly far along" on negotiations for the Roanoke units.
Owners of the Brandon Ridge apartments filed for reorganization in Bankruptcy Court last week but Morgan said he does not expect that to hold up the purchase. The bankruptcy filing stopped a foreclosure auction scheduled for that 120-unit complex, apparently a result of a dispute among the Chicago partners, Morgan said.
A requirement of the tax-exempt bond financing is that 20 percent of the apartments be set aside for people whose income is not more than 50 percent of the Roanoke area's median gross income.
Morgan said that rule "is pretty much the existing situation" at the apartments and he expects current residents will continue to live there.
The housing authority said it would have no ownership or liability in the apartments. By issuing mortgage bonds through the authority, Morgan said he expects to finance the transaction with investment bankers instead of banks, savings and loans and life insurance companies, traditional sources of money for housing.
Depending on the outcome of the hearing, he said he hopes to complete the purchase this spring.
He said he became interested in Roanoke area apartments because he flies in and out of Roanoke for meetings as a member of the alumni board of Washington and Lee University.
Roanoke's real estate market is "very attractive . . . It has not boomed but it has not gone through a bust, either. It's a nice place to make some investment," Morgan said. The National Association of Realtors has ranked Roanoke in the top 31 markets for real estate investment in the 1990s, he said.
The Roanoke Valley apartments, from 18 to 25 years old, have occupancy levels of 90 percent or more, he said.
by CNB