BDC resubmission · September 2026
Assumptions & justification
Every model input with its basis. The same list is on the Assumptions tab of the Excel model. BDC specifically asked about rental rates, interest rates, cap rates and acquisition cost; those are highlighted on the market and 1820 offer pages.
| Assumption | Value | Basis / source |
|---|---|---|
| 1820 purchase price (offer) | $3,000 | Nominal offer for a vacant, City-owned shell that needs a full gut rehab. The as-is value is negative once cost-to-cure is counted (see Assumptions narrative). The public return is delivered through restoration, tax base, jobs, and MBE participation. |
| 1818 acquisition cost | $150,000 | Price at the Mar 6, 2026 substitute trustee's sale (Case C-24-CV-25-008522). Already funded by LLAYD. Counted as land equity. |
| Closing, title, transfer & recordation (% of price, min $7.5k) | 4.00% | 1816 HUD-1 closing costs were $36k on $300k (12%) because back taxes were cleared at settlement. A standard rate is used for new acquisitions, with a floor. |
| Minimum closing cost per acquisition | $7,500 | Title, survey, recordation, legal. |
| Annual rent growth | 2.00% | 2.0%, the MD DHCD underwriting cap. Yardi forecasts 1.9% for Baltimore in 2026, and Harbor Stone reported +1.3% YoY (research/02). |
| Annual expense growth | 3.00% | Matches BDC Exhibit E (3%). |
| Residential vacancy | 7.00% | Bowery 2023 used 7%. Baltimore City stabilized vacancy is 8.2%, and Station North's 11.6% (HSA Q2-25) includes lease-up buildings. A small boutique building with new finishes is underwritten at 7%. |
| Residential credit/collection loss | 1.00% | 1% (Bowery 2023). |
| Commercial vacancy | 8.00% | Baltimore retail vacancy is 6.36% (TenantBase Q2-26); Bowery used 3%. A conservative 8% + 2% = 10% covers small-bay retail on a block that still has vacancy. |
| Commercial credit/collection loss | 2.00% | See above. |
| Other income per unit per month (laundry-in-unit fees, storage, pet, late fees) | $35 | Conservative for small walk-ups. |
| Property management (% of EGI) | 5.00% | 5% (Bowery 2023 range 2–6%). ERJ Development LLC manages the property. |
| Insurance per residential unit / yr | $900 | Historic masonry, sprinklered, mixed-use. The Jan-2026 submission carried $5,600 for 7 units (~$800). |
| Insurance per commercial unit / yr | $1,200 | Landlord's share of the commercial policy. |
| Repairs & maintenance per unit / yr (all units) | $650 | New systems keep early-year maintenance low. |
| Turnover / make-ready per residential unit / yr (furnished) | $450 | Higher for furnished units: professional cleaning, linens, and furniture touch-up between leases. |
| Furniture (FF&E) replacement reserve per residential unit / yr | $750 | Replaces the ≈$12.5k furniture package over about 15 years, with hospitality-grade pieces refreshed as they wear. |
| Resident technology & Wi-Fi services per unit / yr | $900 | Building-wide high-speed Wi-Fi, smart-lock/thermostat platform, and video-intercom subscriptions included with furnished leases. |
| Common utilities per building / yr (house electric, common water/sewer) | $4,200 | Units are separately metered for electric; tenants pay their own. The Jan-2026 submission carried $2,400. |
| Water & sewer per residential unit / yr (owner-paid) | $540 | Baltimore City DPW combined water/sewer rates. |
| Trash, recycling & pest per building / yr | $2,400 | Private hauler for mixed-use. |
| Fire alarm / sprinkler monitoring & inspections per building / yr | $2,600 | NFPA 13R systems require annual inspection plus central-station monitoring. |
| Security, access control & cameras per building / yr | $1,500 | The Jan-2026 submission carried $3,120 for one building. |
| G&A: legal, accounting, software, marketing per unit / yr | $300 | |
| Special Benefits District surcharge per building / yr | $350 | 1816 paid $313 in 2025. |
| Replacement reserves per unit / yr (all units) | $300 | CDFI and agency underwriting standard is $250–$350 per unit. |
| Furnished premium applied to market (underwriting) residential rents | 10.00% | Industry sources cite 15–30% over unfurnished (FurnishedUnfurnished; Flat Fee Landlord). The unfurnished Station North comps are marked up only 10% to stay conservative. The stress tests include a no-premium case. |
| Furniture package per apartment (fully furnished) | $12,500 | Premium, durable pieces for living, bedroom, dining, and kitchen/bath essentials. Mid-range 1BR packages cost $5k–$12k+ (Furnishr 2026); delivery and staging are included. |
| Premium flooring upgrade — Brazilian cherry hardwood or imported porcelain tile ($/SF of unit area, over base allowance) | $11 | Brazilian cherry (Jatoba) is ≈$5–$13/SF material plus $4–$8/SF install (Brazilian Direct; Homewyse). Imported porcelain is ≈$15–$25/SF installed (HomeGuide; Angi). This is the premium over the base flooring allowance already in the trade budget. |
| State-of-the-art smart-home & premium appliance package per apartment | $4,500 | Smart locks, thermostats and lighting; video intercom; premium stainless appliance suite with in-unit washer/dryer upgrade. |
| Private rear deck size (18' × 8') — SF per deck | 144 | Nine rear apartments, one deck each. Rear-yard setback and CHAP/zoning review required. Replaces 1816's permitted 80 SF deck scope. |
| Elevated stacked deck cost ($/SF, composite on steel posts, 42" rails, privacy screens) | $95 | Elevated and multi-level decks run $50–$130/SF (HomeAdvisor; Angi 2026). Upper-range value for stacked 2nd–4th floor decks on a masonry building. |
| Outdoor cooking station per deck (ELECTRIC built-in grill, counter, GFCI power, lighting) | $6,500 | Baltimore City Fire Code §308 bars open-flame cooking on combustible balconies or within 10 ft of combustible construction; electric grills are permitted. Confirm with the Fire Marshal. |
| Deck furniture package per deck (dining set, lounge seating, planters) | $2,500 | Weather-rated outdoor furnishings; part of the furnished apartment package. |
| Deck & outdoor kitchen maintenance per deck / yr | $300 | Cleaning, sealing, appliance service. |
| Total property tax rate (City 2.248% + State 0.112%) | 2.36% | Baltimore City FY2026 real property tax bill for 1816 N Charles; City rate confirmed for FY2027 (research/02). |
| City portion of the tax rate (basis for the CHAP credit) | 2.25% | CHAP credits the City tax only. |
| 1816 stabilized assessment | $1,200,000 | Bowery as-complete value was $1.21M (Feb 2024). SDAT assesses at full cash value. |
| 1818 stabilized assessment | $1,250,000 | Estimated: 6 apartments + 1 commercial unit, similar to 1816. |
| 1820 stabilized assessment | $1,250,000 | Estimated: 6 apartments + 1 commercial unit. |
| 1816 pre-rehab (base) assessment | $230,000 | SDAT 2025–26 assessment: $230,000. |
| 1818 pre-rehab (base) assessment | $412,600 | SDAT assessment cited in the 1818 foreclosure exceptions: $412,600. |
| 1820 pre-rehab (base) assessment | $150,000 | Estimated. The parcel is City-owned and tax-exempt today; confirm the base value with SDAT/CHAP after conveyance. |
| CHAP credit: share of assessment increase credited | 100.00% | City Code Art. 28 §10-8: 100% of the city tax on the assessment increase for projects ≤$5M, for 10 years. The State portion is not credited, so this model credits only the City rate. Preliminary CHAP approval is required BEFORE work starts, and applications close 12/31/2027. |
| CHAP credit term (years) | 10 | 10-year credit, per the BDC RFP Section VII.b. |
| Stabilized going-in cap rate | 7.50% | The Bowery appraisal concluded 7.50% for 1816. Small Baltimore mixed-use typically trades at 7–8.5% (see research/02). |
| Exit (Year 10) cap rate | 8.00% | Going-in rate plus 50 bps, a conservative reversion assumption. |
| Cost of sale at reversion | 3.00% | |
| 1816 remaining hard cost to complete (residential + commercial) | $322,000 | The PM dashboard shows $277k of the $1.019M budget left to deploy. That figure plus the $45k sprinkler/fire-alarm scope gap is carried here. |
| 1820 gut-rehab hard cost ($/GSF, trades only) | $215 | Trades only. Façade, sprinkler, abatement, storefront, GC fee, escalation and contingency are added separately, for an all-in ≈$300/GSF. Benchmarks: DHCD rehab cost limits $202–$277/SF; research recommends $250/SF before contingency. 1816's actual budget was about $170/SF. |
| 1818 rehab of existing 3,800 SF ($/GSF) | $185 | The existing building is in better shape: a former restaurant fit-out that was occupied until 2025. |
| 1818 new 3rd–4th floor vertical addition ($/GSF) | $325 | New construction on an existing masonry bearing structure, with steel/LVL framing and an elevator-free walk-up. Subject to structural engineering and CHAP review. |
| 1818 new vertical addition area (SF) | 2,600 | Two new floors of about 1,300 SF each above the existing 2-story building. |
| 1818 historic façade restoration | $65,000 | Masonry repointing, cornice, and storefront to match the mansion. |
| 1820 historic façade restoration | $90,000 | Paint removal, repointing, wood windows, cornice, and entry. |
| Commercial white-box / storefront per unit (1818, 1820) | $45,000 | The BRNI advance invoice for 1816's two units was $125k ($62.5k each, including façade). Vanilla-box scope. |
| Fire sprinkler + fire alarm per building (1818, 1820) | $32,000 | The Fuentes quote for 1816 was $19,025 for sprinklers only (2nd–4th floors). Fire alarm and backflow are added here. |
| Environmental abatement allowance (lead/asbestos) per building | $25,000 | Pre-1978 buildings; the BDC RFP flags possible environmental hazards. |
| Hard cost contingency — 1818 & 1820 | 12.50% | 12.5% for an unopened historic gut rehab. The industry norm is 10–15% (research/02). |
| Hard cost contingency — 1816 (known remaining scope) | 10.00% | 10% on remaining scope that is already bid or quoted. |
| Cost escalation to construction midpoint — 1818 & 1820 | 6.00% | About 4%/yr (RLB Q2-2026) over the ≈1.5 years to the construction midpoint (Q1 2028). |
| GC overhead & profit (Tyjuan Amor LLC, related party) | 8.00% | Disclosed related-party fee. Below the 10–12% market norm, reflecting partial self-performance. |
| Architecture, engineering & structural (% of hard) | 7.00% | Includes CHAP submissions and structural design for the 1818 addition. 1816 design cost $19k. |
| Permits, CHAP, zoning & utility fees (% of hard) | 1.50% | The Jan-2026 Exhibit F carried $4,800 in permit fees for 1820 alone. |
| Legal, title, organizational & LDA (% of hard) | 1.00% | |
| Builder's risk & GL during construction (% of hard) | 1.20% | |
| Appraisal, Phase I ESA, survey, market study per building | $12,000 | Required for NIIF underwriting. |
| Marketing & lease-up per unit | $750 | |
| Soft cost contingency | 5.00% | |
| Developer fee (% of total development cost excl. acquisition) | 8.00% | Below the typical 10–15% cap for CDFI and state-funded deals. At least 50% is deferred to fill the gap. |
| Share of developer fee deferred | 50.00% | The deferred portion is paid from cash flow and shown as a source. |
| Operating reserve (months of OpEx + debt service) | 6 | NIIF and CDFI standard. |
| NIIF interest rate (construction & perm) | 5.00% | NIIF publishes 5.0% fixed for real estate loans up to $3M (baltimoreniif.org/financing/real-estate-loans). Subject to NIIF underwriting. |
| NIIF amortization (years) | 25 | |
| NIIF permanent term (years) | 7 | NIIF term loans run up to 7 years. The pro forma assumes a refinance or extension at maturity on similar terms. |
| Construction interest-only period (months) | 18 | NIIF allows 18–24 months of IO. 18 months matches the construction schedule. |
| Average outstanding balance during construction | 55.00% | Standard draw curve. |
| NIIF origination fee | 1.50% | NIIF charges up to 1.5%. |
| NIIF max loan-to-cost | 80.00% | Typical CDFI maximum (see research/04). |
| NIIF max loan-to-value (as-completed) | 80.00% | Construction loans: ≤80% of as-completed value. Term loans: ≤95% of as-stabilized value. |
| NIIF maximum loan size | $3,000,000 | NIIF real estate loans go up to $3M. |
| Size NIIF loan on market (underwriting) rents? (1 = yes) | 1 | 1 = conservative: the loan is sized on comparable-supported rents (research/02), not on target rents. |
| Minimum DSCR used to size the NIIF loan | 1.25x | 1.25x at market rents. CDFI and commercial norm is 1.20–1.25x; MD DHCD floor is 1.15x (research/04). Sizing at 1.25x keeps the NIIF construction LTV near the recommended 75% cushion. |
| 1816 permanent loan (refinance) | $700,000 | Pays off about $547k owed to Nextres/FCI (principal plus charges) and funds part of the remaining work. Sized to 1.20x+ DSCR and ≤60% LTV. |
| 1816 permanent loan rate | 7.25% | Bank or CDFI permanent debt is ≈7.0–8.0% (10-yr Treasury 5.02% on 9/16/26 + 200–300 bp). If NIIF participates at 5%, coverage improves (see Sensitivity). |
| 1816 permanent loan amortization (years) | 25 | |
| 1816 hard-money payoff (Nextres/FCI) | $547,000 | Principal $527,490 + loan charges $16,502 + late charges $648 + deferred interest $2,198, as of Feb 2026. |
| Hard-money bridge rate (last resort) | 12.00% | The Q1-2026 Maryland average was 11.19%. Lenders quote 9–13.5% plus 1–4 points. 1816's existing Nextres loan is at 15% (research/02). |
| Hard-money origination points | 2.50% | |
| Sponsor cash equity (personal funds) – 1818 & 1820 | $200,000 | Bradford & Jasmine Phillips / LLAYD LLC. Proof of funds to be provided. |
| MD Legislative Bond Initiative – 2027 session request (District 40) | $500,000 | District 40 (Sen. Hayes) application is due 11/23/2026, with presentations 11/30/2026. LBIs are non-matching unless the authorization says otherwise. Funds are available after 6/1/2027, which fits the July 2027 construction start. The 2025 session awarded LLAYD $250k. |
| BDC Façade Improvement Grant — Rehabilitation FIG ($25k × 2 buildings) | $50,000 | The Rehabilitation FIG is $25,000 with a 1:1 match, paid by reimbursement. A BDC site meeting is required first, and no work may start before approval (research/03). |
| MD Historic Revitalization Tax Credit — Competitive Commercial (20% of QRE) | 20.00% | 20% of QRE, with an OZ bonus possible. The next round runs June–Aug 31, 2027; Part 2 approval is needed before work. Fallback is the Small Commercial credit, capped at $50k per project (research/03). |
| Federal Historic Tax Credit rate | 20.00% | 20% of QRE for income-producing certified historic structures. 1820 is in the North Central National Register Historic District. |
| Tax credit equity pricing ($ per $1 of credit) | $1 | Pricing is UNVERIFIED. Small deals typically price at 80–95¢; 85¢ is modeled pending an investor quote. |
| Qualified rehab expenditures as a share of hard + eligible soft | 80.00% | Excludes acquisition, site work, the new addition (not QRE), and FF&E. |
| Include federal HTC equity in base case (1 = yes, 0 = no) | 1 | Requires NPS Part 1–3 certification and confirmed contributing status in the North Central NR District. The substantial-rehabilitation test applies. |
| Include MHT state credit in base case (1 = yes, 0 = no) | 1 | Competitive award; the Small Commercial credit is an alternative. |
| BRNI award – 1816 (DHCD, BRNI-2026-LLAYD-00539-R) | $250,000 | Awarded. Term 1/1/2026–6/30/2028. |
| MD bond bill – 2025 (LLAYD / 1816) | $250,000 | Awarded to LLAYD for the 1816 N. Charles commercial spaces. |
| Sponsor equity invested to date – 1816 | $559,000 | Per the 2025 LBI request and investor overview. |
| 1818 existing gross SF | 3,800 | Per the 1818 foreclosure filing (about 3,800 SF restaurant/lounge). Verify with a measured survey. |
| 1820 gross SF (4 floors + lower level) | 6,300 | Estimated from the 1,655 SF lot and a footprint similar to 1816 (5,484 GBA on a 1,437 SF lot). Verify with a measured survey. |
| 1816 design & construction completed to date (excl. acquisition) | $797,000 | $1,097,000 invested to date minus the $300,000 purchase price (PM dashboard, Feb 2026). |
| 1816 settlement charges (HUD-1) | $36,052 | HUD settlement statement, June 26, 2023. |
| 1816 carrying costs to date (interest, fees, taxes, water, registration) | $230,744 | Financial summary, Feb 23, 2026. |
| 1816 hard-money charges at payoff (fees, late charges, deferred interest) | $19,510 | FCI servicing statement: $16,502 + $648 + $2,198 + $162 other. |
| 1816 soft costs to complete (CO, inspections, legal, leasing) | $25,000 | |
| 1816 refinance closing costs (% of loan) | 2.00% | |
| Apply CHAP credit to 1816? (1 = yes, 0 = no) | 0 | Excluded (conservative). The CHAP credit must be applied for before work starts, and 1816 work began in Jan 2024. Confirm whether an application was filed. |
| Include CHAP credit in NIIF sizing NOI? (1 = yes) | 1 | 1 = yes: the CHAP credit is a certified 10-year City tax credit, and the loan is still sized on market rents. The Debt_Metrics tab also shows DSCR without CHAP. |
| DHCD BRNI — FY2029 round (1818/1820) | $150,000 | The FY2028 round closed 8/6/2026; FY2029 is expected ≈June 2027. Awards typically run $25k–$500k. Applicants must be nonprofit CDOs, so confirm LLAYD's eligibility or apply with a CDO partner (research/03). |
| DHCD Strategic Demolition Fund / Project C.O.R.E. — via CDO partner | $250,000 | Covers stabilization and redevelopment of vacant buildings. Open only to local governments and nonprofit CDOs, so it would be requested with Central Baltimore Partnership (research/03). |
| DHCD Community Legacy — via CDO partner | $100,000 | Capital grant in Sustainable Communities through a CDO or local government. The FY28 round closed 8/6/2026; FY29 is expected mid-2027. |
| First stabilized operating year (pro forma Year 1) | 2,029 | 1816 completes in 2027. 1818/1820 construct Q3 2027–Q4 2028 and lease up by mid-2029. |