Investments in Mortgage Revenue Bonds ("MRBs") | 6. Investments in Mortgage Revenue Bonds (“MRBs”) MRBs owned by the Partnership have been issued to provide construction and/or permanent financing for Residential Properties and commercial properties. MRBs are either held directly by the Partnership or are held in trusts created in connection with debt financing transactions (Note 15). The Partnership had the following investments in MRBs at September 30, 2017 and December 31, 2016: September 30, 2017 Description of Mortgage Revenue Bonds Held in Trust State Cost Adjusted for Paydowns Cumulative Unrealized Gain Cumulative Unrealized Loss Estimated Fair Value Courtyard - Series A & B (2) CA $ 16,458,000 $ 1,138,145 $ - $ 17,596,145 Glenview Apartments - Series A (4) CA 4,638,152 640,243 - 5,278,395 Harmony Court Bakersfield - Series A & B (2) CA 3,730,000 398,115 - 4,128,115 Harmony Terrace - Series A & B (2) CA 14,300,000 812,807 - 15,112,807 Harden Ranch - Series A (3) CA 6,862,983 1,086,331 - 7,949,314 Las Palmas II - Series A & B (2) CA 3,465,000 179,028 - 3,644,028 Montclair Apartments - Series A (4) CA 2,512,746 401,052 - 2,913,798 San Vicente - Series A & B (2) CA 5,320,000 279,275 - 5,599,275 Santa Fe Apartments - Series A (4) CA 3,044,098 525,978 - 3,570,076 Seasons at Simi Valley - Series A (2) CA 4,376,000 784,070 - 5,160,070 Seasons Lakewood - Series A & B (2) CA 12,610,000 822,322 - 13,432,322 Seasons San Juan Capistrano - Series A & B (2) CA 18,949,000 1,127,068 - 20,076,068 Summerhill - Series A & B (2) CA 9,795,000 684,808 - 10,479,808 Sycamore Walk - Series A (2) CA 3,632,000 466,553 - 4,098,553 The Village at Madera - Series A & B (2) CA 4,804,000 311,708 - 5,115,708 Tyler Park Townhomes - Series A (3) CA 5,980,454 877,348 - 6,857,802 Westside Village Market - Series A (3) CA 3,908,215 604,569 - 4,512,784 Lake Forest (1) FL 8,540,000 1,485,248 - 10,025,248 Ashley Square (1) IA 4,994,000 13,538 - 5,007,538 Brookstone (1) IL 7,454,205 2,113,460 - 9,567,665 Copper Gate Apartments (3) IN 5,145,000 867,844 - 6,012,844 Renaissance - Series A (4) LA 11,267,286 1,628,900 - 12,896,186 Live 929 Apartments (2) MD 40,594,362 3,961,295 - 44,555,657 Woodlynn Village (1) MN 4,289,000 10,736 - 4,299,736 Greens Property - Series A (3) NC 8,147,000 1,230,615 - 9,377,615 Silver Moon - Series A (4) NM 7,893,310 1,079,738 - 8,973,048 Ohio Properties - Series A (1) OH 14,140,000 996,412 - 15,136,412 Bridle Ridge (1) SC 7,465,000 57,667 - 7,522,667 Columbia Gardens (2) SC 15,175,444 498,008 - 15,673,452 Companion at Thornhill Apartments (2) SC 11,431,237 1,314,765 - 12,746,002 Cross Creek (1) SC 6,133,621 3,014,744 - 9,148,365 The Palms at Premier Park Apartments (3) SC 19,284,860 2,938,148 - 22,223,008 Willow Run (2) SC 15,176,206 135,745 - 15,311,951 Arbors at Hickory Ridge (3) TN 11,372,772 1,655,828 - 13,028,600 Pro Nova 2014-1 (2) TN 10,039,648 193,874 - 10,233,522 Avistar at Chase Hill - Series A (3) TX 9,773,429 - (280,678 ) 9,492,751 Avistar at Copperfield - Series A (2) TX 10,000,000 423,447 - 10,423,447 Avistar at the Crest - Series A (3) TX 9,480,225 1,021,050 - 10,501,275 Avistar at the Oaks - Series A (3) TX 7,654,594 880,439 - 8,535,033 Avistar at the Parkway - Series A (4) TX 13,262,378 908,602 - 14,170,980 Avistar at Wilcrest - Series A (2) TX 3,775,000 207,425 - 3,982,425 Avistar at Wood Hollow - Series A (2) TX 31,850,000 1,348,678 - 33,198,678 Avistar in 09 - Series A (3) TX 6,609,446 666,232 - 7,275,678 Avistar on the Boulevard - Series A (3) TX 16,150,587 1,664,812 - 17,815,399 Avistar on the Hills - Series A (3) TX 5,288,542 608,293 - 5,896,835 Bella Vista (1) TX 6,295,000 100,991 - 6,395,991 Bruton Apartments (2) TX 18,080,240 2,607,782 - 20,688,022 Concord at Gulfgate - Series A (2) TX 19,185,000 2,611,745 - 21,796,745 Concord at Little York - Series A (2) TX 13,440,000 1,896,349 - 15,336,349 Concord at Williamcrest - Series A (2) TX 20,820,000 2,834,325 - 23,654,325 Crossing at 1415 - Series A (2) TX 7,590,000 295,343 - 7,885,343 Decatur Angle (2) TX 22,834,591 2,518,998 - 25,353,589 Heights at 515 - Series A (2) TX 6,435,000 329,490 - 6,764,490 Heritage Square - Series A (4) TX 11,088,157 989,114 - 12,077,271 Oaks at Georgetown - Series A & B (2) TX 17,842,000 808,259 - 18,650,259 Runnymede (1) TX 10,200,000 168,797 - 10,368,797 Southpark (1) TX 11,809,069 3,192,305 - 15,001,374 Vantage at Harlingen - Series B (4) TX 24,379,208 1,921,472 - 26,300,680 Vantage at Judson -Series B (4) TX 26,187,732 3,403,014 - 29,590,746 15 West Apartments (2) WA 9,812,357 1,733,769 - 11,546,126 Mortgage revenue bonds held in trust $ 672,771,154 $ 67,476,716 $ (280,678 ) $ 739,967,192 (1) MRBs owned by ATAX TEBS I, LLC (M24 TEBS), Note 15 (2) MRBs held by Deutsche Bank in a secured financing transaction, Note 15 (3) MRBs owned by ATAX TEBS II, LLC (M31 TEBS), Note 15 (4) MRBs owned by ATAX TEBS III, LLC (M33 TEBS), Note 15 September 30, 2017 Description of Mortgage Revenue Bonds held by the Partnership State Cost Adjusted for Paydowns Cumulative Unrealized Gain Cumulative Unrealized Loss Estimated Fair Value Montecito at Williams Ranch Apartments - Series A & B CA $ 12,471,000 $ - $ - $ 12,471,000 Seasons at Simi Valley - Series B CA 1,944,000 84 - 1,944,084 Sycamore Walk - Series B CA 1,815,000 - (1,078 ) 1,813,922 Greens Property - Series B NC 938,204 211,542 - 1,149,746 Ohio Properties - Series B OH 3,539,619 192,655 - 3,732,274 Avistar at Chase Hill - Series B TX 954,095 - (56,474 ) 897,621 Avistar at Copperfield - Series B TX 4,000,000 12,278 - 4,012,278 Avistar at the Crest - Series B TX 750,423 47,206 - 797,629 Avistar at the Oaks - Series B TX 548,883 33,008 - 581,891 Avistar at the Parkway - Series B TX 124,922 30,779 - 155,701 Avistar at Wilcrest - Series B TX 1,550,000 4,816 - 1,554,816 Avistar at Wood Hollow - Series B TX 8,410,000 27,395 - 8,437,395 Avistar in 09 - Series B TX 452,779 25,439 - 478,218 Avistar on the Boulevard - Series B TX 445,904 26,313 - 472,217 Crossing at 1415 - Series B TX 335,000 1,079 - 336,079 Heights at 515 - Series B TX 510,000 1,815 - 511,815 Mortgage revenue bonds held by the Partnership $ 38,789,829 $ 614,409 $ (57,552 ) $ 39,346,686 December 31, 2016 Description of Mortgage Revenue Bonds Held in Trust State Cost Adjusted for Paydowns Cumulative Unrealized Gain Cumulative Unrealized Loss Estimated Fair Value Glenview Apartments - Series A (4) CA $ 4,670,000 $ 132,402 $ - $ 4,802,402 Harmony Terrace - Series A & B (2) CA 14,300,000 - - 14,300,000 Harden Ranch - Series A (3) CA 6,912,535 369,738 - 7,282,273 Montclair Apartments - Series A (4) CA 2,530,000 108,608 - 2,638,608 Santa Fe Apartments - Series A (4) CA 3,065,000 177,093 - 3,242,093 Seasons at Simi Valley - Series A (2) CA 4,376,000 308,335 - 4,684,335 Sycamore Walk - Series A (2) CA 3,632,000 130,431 - 3,762,431 Tyler Park Townhomes - Series A (3) CA 6,024,120 237,582 - 6,261,702 Westside Village Market - Series A (3) CA 3,936,750 102,641 - 4,039,391 Lake Forest (1) FL 8,639,000 899,694 - 9,538,694 Ashley Square (1) IA 5,039,000 338,556 - 5,377,556 Brookstone (1) IL 7,462,678 1,457,340 - 8,920,018 Copper Gate Apartments (3) IN 5,145,000 528,855 - 5,673,855 Renaissance - Series A (4) LA 11,348,364 826,369 - 12,174,733 Live 929 Apartments (2) MD 40,687,425 3,587,993 - 44,275,418 Woodlynn Village (1) MN 4,310,000 294,976 - 4,604,976 Greens Property - Series A (3) NC 8,210,000 844,585 - 9,054,585 Silver Moon - Series A (4) NM 7,933,259 465,382 - 8,398,641 Ohio Properties - Series A (1) OH 14,215,000 2,327,468 - 16,542,468 Bridle Ridge (1) SC 7,535,000 517,881 - 8,052,881 Columbia Gardens (2) SC 15,214,223 - (927,030 ) 14,287,193 Companion at Thornhill Apartments (2) SC 11,500,000 645,552 - 12,145,552 Cross Creek (1) SC 6,122,312 2,655,730 - 8,778,042 The Palms at Premier Park Apartments (3) SC 19,826,716 1,784,386 - 21,611,102 Willow Run (2) SC 15,214,085 - (917,852 ) 14,296,233 Arbors at Hickory Ridge (3) TN 11,461,719 891,274 - 12,352,993 Pro Nova 2014-1 (2) TN 10,041,924 685,576 - 10,727,500 Avistar at Chase Hill - Series A (3) TX 9,844,994 589,023 - 10,434,017 Avistar at the Crest - Series A (3) TX 9,549,644 753,267 - 10,302,911 Avistar at the Oaks - Series A (3) TX 7,709,040 563,138 - 8,272,178 Avistar at the Parkway - Series A (4) TX 13,300,000 - (78,749 ) 13,221,251 Avistar in 09 - Series A (3) TX 6,656,458 359,562 - 7,016,020 Avistar on the Boulevard - Series A (3) TX 16,268,850 1,283,272 - 17,552,122 Avistar on the Hills - Series A (3) TX 5,326,157 423,496 - 5,749,653 Bella Vista (1) TX 6,365,000 500,162 - 6,865,162 Bruton Apartments (2) TX 18,145,000 349,886 - 18,494,886 Concord at Gulfgate - Series A (2) TX 19,185,000 1,200,246 - 20,385,246 Concord at Little York - Series A (2) TX 13,440,000 1,044,752 - 14,484,752 Concord at Williamcrest - Series A (2) TX 20,820,000 1,302,534 - 22,122,534 Crossing at 1415 - Series A (2) TX 7,590,000 - (45,555 ) 7,544,445 Decatur Angle (2) TX 22,950,214 - (290,985 ) 22,659,229 Heights at 515 - Series A (2) TX 6,435,000 - (38,623 ) 6,396,377 Heritage Square - Series A (4) TX 11,161,330 905,455 - 12,066,785 Oaks at Georgetown - Series A & B (2) TX 17,842,000 - - 17,842,000 Runnymede (1) TX 10,250,000 774,285 - 11,024,285 Southpark (1) TX 11,751,861 3,286,203 - 15,038,064 Vantage at Harlingen - Series B (4) TX 24,529,580 917,720 - 25,447,300 Vantage at Judson -Series B (4) TX 26,356,498 1,658,508 - 28,015,006 15 West Apartments (2) WA 9,850,000 1,584,281 - 11,434,281 Mortgage revenue bonds held in trust $ 554,678,736 $ 37,814,237 $ (2,298,794 ) $ 590,194,179 (1) MRBs owned by ATAX TEBS I, LLC (M24 TEBS), Note 15 (2) MRBs held by Deutsche Bank in a secured financing transaction, Note 15 (3) MRBs owned by ATAX TEBS II, LLC (M31 TEBS), Note 15 (4) MRBs owned by ATAX TEBS III, LLC (M33 TEBS), Note 15 December 31, 2016 Description of Mortgage Revenue Bonds held by the Partnership State Cost Adjusted for Paydowns Cumulative Unrealized Gain Cumulative Unrealized Loss Estimated Fair Value Courtyard - Series A & B CA $ 16,458,000 $ - $ - $ 16,458,000 Harmony Court Bakersfield - Series A & B CA 5,727,000 29,252 - 5,756,252 Las Palmas II - Series A & B CA 3,465,000 15,139 - 3,480,139 San Vicente - Series A & B CA 5,320,000 - (30,019 ) 5,289,981 Seasons at Simi Valley - Series B CA 1,944,000 27,727 - 1,971,727 Seasons Lakewood - Series A & B CA 12,610,000 - - 12,610,000 Seasons San Juan Capistrano - Series A & B CA 18,949,000 - - 18,949,000 Summerhill - Series A & B CA 9,795,000 - (174,982 ) 9,620,018 Sycamore Walk - Series B CA 1,815,000 - (64,432 ) 1,750,568 The Village at Madera - Series A & B CA 4,804,000 - (84,437 ) 4,719,563 Greens Property - Series B NC 940,479 118,216 - 1,058,695 Ohio Properties - Series B OH 3,549,780 449,068 - 3,998,848 Avistar at Chase Hill - Series B TX 957,627 41,820 - 999,447 Avistar at the Crest - Series B TX 753,201 64,228 - 817,429 Avistar at the Oaks - Series B TX 550,836 47,231 - 598,067 Avistar at the Parkway - Series B TX 125,000 - (3,341 ) 121,659 Avistar in 09 - Series B TX 454,390 38,961 - 493,351 Avistar on the Boulevard - Series B TX 447,554 38,165 - 485,719 Crossing at 1415 - Series B TX 335,000 - (2,614 ) 332,386 Heights at 515 - Series B TX 510,000 - (3,977 ) 506,023 Mortgage revenue bonds held by the Partnership $ 89,510,867 $ 869,807 $ (363,802 ) $ 90,016,872 See Note 22 for a description of the methodology and significant assumptions for determining the fair value of the MRBs. Unrealized gains or losses on the MRBs are recorded in the condensed consolidated statements of comprehensive income (loss) to reflect changes in their estimated fair values resulting from market conditions and fluctuations in the present value of the expected cash flows from the MRBs. Bond Activity in the First Nine Months of 2017 The following table includes the details of the MRB acquisitions during the nine months ended September 30, 2017: Property Name Month Acquired Property Location Units Maturity Date Base Interest Rate Principal Outstanding at Date of Acquisition Avistar at Copperfield - Series A February Houston, TX 192 5/1/2054 5.75 % $ 10,000,000 Avistar at Copperfield - Series B February Houston, TX 192 6/1/2054 12.00 % 4,000,000 Avistar at Wilcrest - Series A February Houston, TX 88 5/1/2054 5.75 % 3,775,000 Avistar at Wilcrest - Series B February Houston, TX 88 6/1/2054 12.00 % 1,550,000 Avistar at Wood Hollow - Series A February Austin, TX 409 5/1/2054 5.75 % 31,850,000 Avistar at Wood Hollow - Series B February Austin, TX 409 6/1/2054 12.00 % 8,410,000 Montecito at Williams Ranch Apartments - Series A September Salinas, CA 132 10/1/2034 5.50 % 7,690,000 Montecito at Williams Ranch Apartments - Series B September Salinas, CA 132 10/1/2019 5.50 % 4,781,000 $ 72,056,000 In August 2017, the Partnership redeemed one MRB for approximately $2.0 million, which approximated the carrying value plus accrued interest. The following table includes details of the MRB redeemed: Property Name Month Redeemed Property Location Units Original Maturity Date Base Interest Rate Principal Outstanding at Date of Redemption Harmony Court Bakersfield - Series B August Bakersfield, CA 96 12/1/2018 5.50 % $ 1,997,000 Bond Activity in the First Nine Months of 2016 The following table includes the details of the MRB acquisitions during the nine months ended September 30, 2016: Property Name Month Acquired Property Location Units Maturity Date Base Interest Rate Principal Outstanding at Date of Acquisition Companion at Thornhill Apartments January Lexington, SC 178 1/1/2052 5.80 % $ 11,500,000 Las Palmas II - Series A September Coachella, CA 81 11/1/2033 5.00 % 1,695,000 Las Palmas II - Series B September Coachella, CA 81 11/1/2018 5.50 % 1,770,000 San Vicente - Series A September Soledad, CA 50 11/1/2033 5.00 % 3,495,000 San Vicente - Series B September Soledad, CA 50 11/1/2018 5.50 % 1,825,000 $ 20,285,000 In March 2016, the Partnership sold the Pro Nova 2014-2 bond for approximately $9.5 million, which approximated the MRB’s carrying value plus accrued interest. The Partnership used approximately $8.4 million of the proceeds from the sale to pay in full and collapse the TOB Trust securitizing this MRB (Note 15). The following table includes details of the MRB redeemed: Property Name Month Exchanged Property Location Units Maturity Date Base Interest Rate Principal Outstanding at Date of Exchange Pro Nova - 2014B 1 March Knoxville, TN - 5/1/2025 5.25 % $ 9,295,000 1 This is a commercial property. Accordingly, unit information is not applicable. In May 2016, the Partnership redeemed the four Series B MRBs for approximately $5.2 million which approximated their carrying value plus accrued interest. The following table includes details of the MRBs redeemed: Property Name Month Redeemed Property Location Units Original Maturity Date Base Interest Rate Principal Outstanding at Date of Redemption Glenview Apartments - Series B May Cameron, CA 88 12/1/2016 8.00 % $ 2,053,000 Montclair Apartments - Series B May Lemoore, CA 80 12/1/2016 8.00 % 928,000 Santa Fe Apartments - Series B May Hesperia, CA 89 12/1/2016 8.00 % 1,671,000 Heritage Square - Series B May Edinburg, TX 204 10/1/2051 12.00 % 520,000 In August 2016, six of the Partnership’s MRBs relating to three properties were restructured. For each property, the Series B mortgage revenue bond was redeemed and the outstanding principal balance was added to the outstanding principal on the Series A bonds. The terms of the three Series B mortgage revenue bonds that were redeemed are as follows: Property Name Month Restructured Property Location Units Maturity Date Base Interest Rate Principal Outstanding at Date of Restructuring Concord at Gulfgate - Series B August Houston, TX 288 3/1/2032 12.00 % $ 2,125,000 Concord at Little York - Series B August Houston, TX 276 3/1/2032 12.00 % 960,000 Concord at Williamcrest - Series B August Houston, TX 288 3/1/2032 12.00 % 2,800,000 |