MINUTES OF REGULAR MEETING OF
THE HEALTH, EDUCATIONAL AND HOUSING FACILITY BOARD
OF THE CITY OF MEMPHIS, TENNESSEE
Wednesday, February 4, 2026
The regular meeting of The Health, Educational and Housing Facility Board of the City of Memphis, Tennessee (the “Board”) was held pursuant to public notice published in The Daily News on Wednesday, January 28, 2026, simultaneous posting to the Daily Memphian website at: www.dailymemphian.com, and the public notice was continuously published on the Board’s website at: www.memphishehf.com. The published meeting time was 12:00 Noon. The meeting was held at Junior Achievement of Memphis located at 516 Tillman Street, Memphis, TN 38112.
The following Directors were present:
Daniel T. Reid,Chairman Monice Hagler
Buckner Wellford Cliff Henderson
Howard Eddings, Jr. Vincent Sawyer
Courtnee Melton-Fant
Staff and others attending: Trey McKnight, Stephanie Bryant, JP Townsend; Charles E. Carpenter and Corbin I. Carpenter, General Counsel; Katrina Shephard (Zoom), legal assistant to General Counsel; Cheryl Hearn, Deputy City Attorney; and Mike Humes, consultant to the HEHFB Strategic Planning Committee.
Also participating in person and/or via remote Zoom virtual platform were Jarad Bingham, Kelcey Johnson of Hospitality Hub, and Bill Ganus of November 6 Investments representing Hospitality Hub-Hub North, LP; Bill Ganus of November 6 Investments representing 300 Court; Thomas Robinson, Alexis Morris, Mallory Key, Andy Jones of Alco Management, Inc. representing Surrey Apartments, Creekwood Village and Eastern Heights, and Saints Court Apartments; Clifford Causey and Jevon Allen of Christian Church Homes, and Phillip Vaughn representing Covenant Gardens Senior Apartments; Mark Jobe of Glankler Brown Law Firm and Luis Rodrigues representing Dogwood Trace Apartments; Kelly Dervarics and Brock Armstrong of McCormack Baron Salazar, Archie Willis, Alan Willis, and Nicholas Dillon of ComCap Partners, and Dexter Washington and Luretha Phillips of Memphis Housing Authority (MHA), all representing University Place Family and University Place Senior; Elizabeth Friary and David Porteous of Evans Petree Law Firm, Michael Bernstein of The Bernstein Law Firm and Mendell Fischer and Shrage Marasow representing Bridgeport Manor and Coronado Manor; Venita Doggett, Mary Linda Cuddy, and La Francine Bond of Memphis Interfaith Coalition for Action & Hope (MICAH); Simeon Ike of Greater Memphis Housing Justice Project; Shirley Bondon of the Black Clergy Collaborative of Memphis; Michael Finch of MLK50; and several members of the public were also present.
With a quorum present, the regular meeting of the Board was called to order at 12:00 Noon by Daniel T. Reid, Chairman.
Chairman Reid stated that in compliance with the Open Meetings Law codified in Section 8-44-101 to 8-44-108, inclusive of the Tennessee Code Annotated, as amended, The Health, Educational and Housing Facility Board of the City of Memphis, Tennessee is holding its regular meeting on Wednesday, February 4, 2026 @ Noon as an open public meeting at Junior Achievement of Memphis located at 516 Tillman Street, Memphis, TN 38112.
Chairman Reid stated supplemental Board meeting materials could be accessed on the Board’s website: www.memphishehf.com and reminded all attendees participating via remote access to enter their name and affiliated entities into the Zoom platform for record keeping purposes.
Cliff Henderson reviewed building safety exit procedures for Junior Achievement of Memphis for all attendees and thanked Junior Achievement representatives for hosting today’s meeting in the meeting space.
Public Comment
Chairman Daniel Reid opened the floor for public comment and advised that all comments should be limited to two (2) minutes per speaker.
There was no public comment.
Approval of Minutes
Cliff Henderson moved for approval of the Minutes of the December 3, 2025 Regular Meeting, which was seconded by Monice Hagler and the motion passed unanimously after proper roll call vote of the Board members.
Attorney’s Report
Charles Carpenter presented the legal report, as follows:
1. Carpenter reported no new lawsuits received for the months of December 2025 and January 2026. Carpenter reported that his Firm has received several materialmen claims which have been filed on certain PILOT properties which will be handled in the normal course.
2. Carpenter reported closing activities for December 2025 as follows:
a. Ridgecrest Bond + PILOT closings completed.
b. Covenant Gardens Senior Bond 2025 THDA allocation was approved for an IRS tax credit allocation carryforward to 2026.
c. Surrey Apartments Bond 2025 THDA allocation was approved for an IRS tax credit allocation carry forward to 2026.
3. Carpenter reported that the Tennessee Housing Development Agency (THDA) is anticipated to open 2026 Round One for application submissions mid-February 2026, with closing for receiving Round One applications anticipated to take place mid-March 2026.
4. Carpenter reported issuance of five (5) PILOT Legal Default Letters as follows:
a. Country View Apartments- issued on January 16, 2026.
b. Jamesbridge Apartments- issued on January 16, 2026.
c. Feels Like Home Senior Living Residences- issued on January 22, 2026.
d. Abington Apartments- issued on January 22, 2026.
e. Lakes at Epping Way- issued on January 22, 2026.
5. Carpenter reported that his Firm has been monitoring the proposed restrictions to the PILOT program authorizations at the Shelby County and State levels and will report more details as the proposed legislation develops.
6. Finally, Carpenter reported that there is being planned a mandatory HEHFB PILOT Lessee Training Workshop anticipated to take place in 2026 for mandatory attendance by all PILOT Lessees due to certain changes and enhancements for the PILOT program.
There being no further questions or comments, the Legal Report was concluded.
Action Items-
1. 1st Bond Inducement Resolution Extension for Hospitality Hub-Hub North, LP
Charles Carpenter introduced this first action item stating that this is a 1st extension for a bond inducement of a new construction multifamily housing facility to be located at the old Manassas High School. Carpenter reminded the Board that this Bond inducement was approved by the Board at its July 9, 2025 Board meeting, and that approval is for a six (6) month period. Carpenter stated that this closing extension will allow the developer to go forward to put its capital stack, additional working group members, and other items together to move forward with the tax credit allocation and volume cap allocation application to THDA. Carpenter reminded the Board that this project went forward in Round Two of 2025 and was not awarded tax credits, but the developer intends to move forward in 2026 and reapply, for which this closing extension will allow this inducement to stay in place for the developer to move forward with its 2026 THDA application. Carpenter stated that representatives are present for this agenda item, and asked representatives to provide any additional comment.
Kelcey Johnson stated that the group is looking forward to getting started, as Memphis has a large number of young people in the school system who are homeless, and this project will help curb that reality. Johnson stated this project will be a village just for families that are experiencing homelessness and help them to get stabilized. Johnson stated that the project will provide everything the families need, including tutoring from Manassas High School across the street, job readiness, job placement, mental health, addiction, etc., all of which happen on the campus. Johnson stated that The Hospitality Hub is very successful at its 590 Washington campus, which serves the homeless, but this Hub North campus will be just for families. Johnson stated that he is hopeful for the Board’s continued support.
Carpenter reminded the Board that this new construction project will be built using modular home construction, which is different model from the stick-built housing that the Board typically sees throughout its programs, and the application is in compliance with the Board’s policies and procedures and would recommend that the Board look favorably upon this request. There being no further questions or comments,
Monice Hagler made a motion to approve the 1st Bond Inducement Resolution Extension for Hospitality Hub-Hub North, LP. Cliff Henderson seconded, and the motion passed unanimously after proper roll call vote of the Board members.
2. Bond Inducement Resolution for 300 Group GP LLC (d/b/a 300 Court Multifamily Housing)
Carpenter introduced this agenda item, stating that this is an application for a new Bond Inducement Resolution for 300 Court for the transformation and change of use for the former Operations Center for First Tennessee Bank to create family and workforce housing in the downtown Memphis area. Carpenter reminded the Board that a Bond Inducement allows the developer to start the process, put the capital stack, working group, and other items together, and go forward with application to THDA. Carpenter invited representatives in attendance to make any further comments on the project.
Bill Ganus discussed the historic architecture of the building and the location, being adjacent to the medical district, with a demand for workforce housing at 50% and 60% area median income (AMI) in downtown Memphis for custodial staff, entry level nurses, and others to be able to live close to where they work in the medical district. Ganus stated that high quality, newly built accommodations in those price ranges are very rare in the downtown Memphis core. Ganus stated the building was purchased approximately seven (7) years ago on a sufficiently low basis to allow the developer to convert this from office to multifamily and still be able to market to residents at 50% and 60% below AMI. Ganus stated his team is eager to finish putting together the capital stack and this project will be 255 units.
Carpenter reminded the Board that with a Bond Inducement Resolution, the Board assumes no liability or responsibility for further steps but gives the developer the opportunity to pursue additional steps to create the final structure, pursue the allocation from THDA for volume cap and tax credits, and at that time, come back before the Board for it to consider a Final Bond Resolution, which will the Board to ask questions about the structure and ensure all matters are feasible and in order before allowing the process to go forward on the tax exempt basis. Carpenter stated that this application is in compliance with the Board’s policies and procedures and would recommend that the Board look favorably upon this request. Chairman Reid asked if this project includes the parking lot, to which Ganus responded that it includes the most adjacent parking lot. Ganus explained that there is a small portion of the lot that is adjacent, but also adjacent to the Masonic Temple that is next door that is held by a separate third-party. Ganus stated that the parking lot as it stands has 400 parking spots, and the application proposes to convert the entire existing historic structure and build three (3) new garden-style multifamily units as the project does not need the entire parking lot. There being no further questions or comments,
Cliff Henderson made a motion to approve the Bond Inducement Resolution for 300 Group GP LLC (d/b/a 300 Court Multifamily Housing). Buckner Wellford seconded, and the motion passed unanimously after proper roll call vote of the Board members.
Jarad Bingham and Kelcey Johnson left the meeting.
3. 2nd Final Bond Resolution Closing Extension for APP Surrey Partners, L.L.L.P. (d/b/a Surrey Apartments)
Carpenter introduced this agenda item, stating that Action Item 3 and 4 involve the same project and can be discussed together, but voted on separately. Carpenter reminded the Board of his mention of this project in the Legal Report, stating that for the 2025 THDA allocation, this project has received its tax credit and volume cap allocation approval from THDA, but closing of the transaction was impacted by the federal government shutdown due to HUD incentives associated with the bond, as well as other business considerations that delayed the closing of these transactions. Carpenter stated that this is a preservation project and Alco Management has a business model that brings the PILOT closing along with the 4% LIHTC bonds, and but for the delays mentioned above, this project would have closed in December 2025. Carpenter invited representatives in attendance to provide an update on the status of the project at this time.
Thomas Robinson stated that his team is excited to close these transactions soon, as the federal government shutdown rolled things into 2026. Robinsons stated that the working group is established, and the group is working on getting the last items completed to consummate a closing estimated to take place within the next 45 days.
Carpenter stated that Alco Management, is known to the Board and has an excellent track record of closing these bond financings and PILOTs and is one of the leaders for the Tenant Benefit portion of the Board’s PILOT program. Carpenter stated that these applications comply with the Board’s policies and procedures and would recommend that the Board look favorably upon this request.
Buckner Wellford stated that he supports this project, and stated that as mentioned in the Board’s December 5, 2026 Board meeting, as well as will be discussed in today’s Strategic Planning Committee update, the Strategic Planning Committee is working on digital equity and how that fits in with long term strategy. Wellford stated that one of the benefits stated in this application that is being offered is property-paid internet to tenants at no cost to the tenant and asked who the provider is for that. Robinson stated that Alco Management is working with mStreet and the Smart Memphis Fiber Rollout plan that is being rolled out. Wellford asked if once the fiber is available, that part of this project will be for the ownership to pay for the service. Robinson confirmed. Wellford commended Alco and stated that it is something that the Strategic Planning Committee is taking a look at as a whole, and it is worth pointing out when a developer is willing to do that and offering to do that. There being no further questions or comments,
Buckner Wellford made a motion to approve the 2nd Final Bond Resolution Closing Extension for APP Surrey Partners, L.L.L.P. (d/b/a Surrey Apartments). Cliff Henderson seconded, and the motion passed unanimously after proper roll call vote of the Board members.
4. 2nd PILOT Closing Extension for APP Surrey Partners, L.L.L.P. (d/b/a Surrey Apartments)
There being no further questions or comments,
Monice Hagler made a motion to approve the 2nd PILOT Closing Extension for APP Surrey Partners, L.L.L.P. (d/b/a Surrey Apartments). Buckner Wellford seconded, and the motion passed unanimously after proper roll call vote of the Board members.
5. 1st PILOT Term Closing Extension for Alco Eastern Creek Partners, L.P. (d/b/a Creekwood Village and Eastern Heights)
Carpenter introduced this agenda item stating that this is a closing extension for the Alco Eastern Creek Partners PILOT Term Extension approved by the Board at its July 9, 2025 Board meeting and turned the meeting over to representatives to provide a status update on the process. Thomas Robinson stated that this project is financed with HUD insured financing, and with the federal government shutdown, Alco’s ability to move forward and get HUD approvals to extend the PILOT and to receive confirmation was delayed. Robinson stated that his team is working to get the final approvals to get this transaction closed.
Carpenter reminded the Board that there is a PILOT Closing Extension Fee assessed to the applicant for this request, but if the applicant is able to close the transaction within a 30-day period of this approval, that PILOT Closing Extension Fee is waived as part of the policies and procedures of the Board. Carpenter stated that these applications comply with the Board’s policies and procedures and would recommend that the Board look favorably upon this request. There being no further questions or comments,
Cliff Henderson made a motion to approve the 1st PILOT Term Closing Extension for Alco Eastern Creek Partners, L.P. (d/b/a Creekwood Village and Eastern Heights). Courtnee Melton-Fant seconded, and the motion passed unanimously after proper roll call vote of the Board members.
6. Bond Inducement Resolution for APP Saints Court, L.L.L.P. (d/b/a Saints Court Apartments)
Carpenter introduced this agenda item, stating that Action Item 6 and 7 relate to the same project and can be discussed together, but voted on separately. Carpenter stated that this application is for a property that the Board has worked with in the PILOT program before and is a preservation property. Carpenter stated that the developer, Alco Management, plans to complete a substantial rehabilitation of this property and bring it up to code with energy efficient features and other enhancements to the property. Carpenter stated Alco will be using the same model discussed earlier in this meeting with enhancements and tenant benefits and turned the meeting over to representatives for additional comment. Thomas Robinson stated that Alco completed a renovation of this property in 2010, and the time has come to upgrade all the units to ensure the property lasts and is used to provide quality affordable housing. Robinson stated that this property is 100% affordable for the residents, and Alco anticipated spending approximately $70,000 per unit in aggregate for renovations and is excited to bring some new tenant benefits to the property that were not there before including the expansion of the community building to add new space for the residents, more amenities, and to add property paid internet for all residents, to continue the work being done with Safeways, and continue to provide security services.
Carpenter reminded the Board that this is the starting process for the rejuvenation of this asset, and the applicant must go through the THDA process, but his Firm has worked with Alco and they have an excellent team and group of professionals and a great track record. Carpenter stated that the need for affordable housing in the Memphis community is significant, and one of the ways to start is by preserving the housing that is in place, in addition to new construction. Carpenter advised the Board that THDA controls all the volume cap and tax credit approvals statewide, and this is going to be a very competitive year for THDA. Carpenter stated that in addition to the $100 million worth of allocation that has been set aside for the East Bank development in Nashville, TN, there has been a lot of demand from the rural communities in the state that maybe they have not received their fair share and most of the allocations have gone to the urban areas, and it remains to be determined how that is going impact allocations by THDA this year. Carpenter stated that the other part of this is that under the federal tax law, the 50% test, which indicates that 50% of project costs would be funded through tax exempt bonds, has now been reduced to 25%. However, Carpenter stated that this is new and it is unclear exactly how that is going to be handled, and there are some considerations that if a loan amount exceeds the 25%, then THDA will agree to allow that to be the basis for the tests, so there are a lot of unanswered questions to be answered, during the very competitive Round 1. In addition, Carpenter stated that THDA favors developers who have completed projects, developers who have a track record with THDA, so there are more intangible factors that will impact Tennessee for this calendar year. Carpenter advised that once the final structure is put into place, the applicant will come back before the Board with a Final Bond Resolution for the Board to review and approve prior to closing. Carpenter stated that his Firm is in support of both the bond and PILOT applications for this project. There being no further questions or comments,
Cliff Henderson made a motion to approve the Bond Inducement Resolution for APP Saints Court, L.L.L.P. (d/b/a Saints Court Apartments). Howard Eddings, Jr. seconded, and the motion passed unanimously after proper roll call vote of the Board members.
7. Affordable Multifamily PILOT Application for APP Saints Court, L.L.L.P. (d/b/a Saints Court Apartments)
There being no further questions or comments,
Monice Hagler made a motion to approve the Affordable Multifamily PILOT Application for APP Saints Court, L.L.L.P. (d/b/a Saints Court Apartments). Vincent Sawyer seconded, and the motion passed unanimously after proper roll call vote of the Board members.
Thomas Robinson, Alexis Morris, Mallory Key, and Andy Jones left the meeting.
8. 2nd Bond Inducement Resolution Closing Extension for Covenant Gardens Senior Apartments, LP
Carpenter introduced this agenda item, stating that Action Item 8 and 9 relate to the same project and can be discussed together, but voted on separately. Carpenter reminded the Board that this project was mentioned as part of the Legal Report earlier in today’s meeting regarding the IRS carry forward approval that this property has been granted. Like Surrey Apartments with tax credits and volume cap allocation carried forward from THDA in 2025, certain provisions with HUD could not be consummated and THDA did allow this project to go forward with the filing of the IRS carry forward filing process. Thereupon, Carpenter turned the meeting over to representatives to provide additional comment. Pastor Clifford Causey thanked the Board for the opportunity to be in this position, as this project has been under development since March 2021, and there have been many challenges that the development team has overcome, and are now to this point of bringing this project to fruition. Causey stated the project will be a 103-unit senior living project in the Hickory Hill area for seniors at or below 60% AMI. Jevon Allen also thanked the Board for its support and echoed Causey’s comments regarding challenges but stated that the project has its capital stack in place and the senior function lender and syndicator lined up, and are hopeful to close these transactions no later than June 2026. Carpenter stated that these applications comply with the Board’s policies and procedures and would recommend that the Board look favorably upon this request. Carpenter also stated that the tenant benefits are significant and in line with the PILOT program and MHA is supportive of this project as well, and this would be an MHA PILOT, of which the Board administers MHAs PILOT program. There being no further questions or comments,
Cliff Henderson made a motion to approve the 2nd Bond Inducement Resolution Closing Extension for Covenant Gardens Senior Apartments, LP. Howard Eddings, Jr. seconded, and the motion passed unanimously after proper roll call vote of the Board members
9. Affordable Multifamily MHA PILOT Application for Covenant Gardens Senior Apartments, LP
There being no further questions or comments,
Monice Hagler made a motion to approve the Affordable Multifamily MHA PILOT Application for Covenant Gardens Senior Apartments, LP. Cliff Henderson seconded, and the motion passed unanimously after proper roll call vote of the Board members
Clifford Causey left the meeting.
10. Affordable Multifamily PILOT Term Extension Application for Circulo Dogwood, LLC (d/b/a Dogwood Trace Apartments)
Carpenter began by stating that this is a PILOT Term Extension Application for Dogwood Trace Apartments to extend the term of the PILOT for an additional ten (10) years allowable under the revised delegation of authority from City Council for the Board’s PILOT program. Carpenter stated that although the original PILOT term of ten (10) years has expired as of September 3, 2025, while in the process of terminating the PILOT, the PILOT Lessee was advised of the termination and has now applied for this PILOT term extension for an additional ten (10) years. Under the revised delegation of authority, Carpenter stated that the PILOT has not been formally terminated, although it has expired according to its original term. Carpenter turned the meeting over to representatives to provide additional comment.
Mark Jobe, legal counsel to the PILOT Lessee, introduced himself and his client and Dogwood Trace owner, Luis Rodrigues. Jobe stated that since Rodrigues took ownership of this property as part of a PILOT Transfer in March 2022, ownership has been good stewards of the PILOT program and have heavily invested in continued renovation and upgrades, increased security, and have maintained increased security patrols and performed additional renovations that were not contemplated as part of the original PILOT. Jobe stated that he and his client are here today requesting a PILOT Term Extension for Dogwood Trace Apartments, expressed his appreciation to the Board’s legal counsel for providing notice of the PILOT termination, and an opportunity to apply to the Board for this extension after letting the original PILOT Term expiration slip. Jobe stated that the tenant benefit commitments are robust and in compliance with the PILOT program's emphasis on safety and other services and community events monthly and appreciates the Board’s consideration.
Chairman Reid stated that he has been on this Board for quite some time and has never seen a request for a term extension six months after it has expired and asked if notice was received in early 2025 that the PILOT term was due to expire in 2025. Jobe stated that he received notice in November 2025 and immediately submitted the PILOT Term Extension Application within the next deadline, and went through the 60-day waiting period, which is how this ended up getting pushed out. Stephanie Bryant advised that notice was sent to the PILOT Lessee in January or February 2025, prior to the Board’s PILOT policy and procedure changes that took place in March, and the Lessee intended to wait until the revised PILOT policies and procedures, as well as revised application was approved before submitting an application, but no additional notice was sent by Board staff.
Buckner Wellford asked if the PILOT had expired as of the present day. Chairman Reid stated the PILOT term expired September 3, 2025, but it just has not been put back on the tax rolls. Wellford asked for confirmation that as of today, there is no existing PILOT, to which Chairman Reid and Carpenter confirmed. Wellford asked if from a legal standpoint only, is the Board allowed to extend a legally non-existent PILOT. Carpenter stated that from a legal standpoint, the Board can do that, as his office has engaged in discussions with the Shelby County Assessor's Office and based on these extraordinary circumstances, they are willing to work with the Board if the Board deems it appropriate to move forward with the PILOT term extension. If the Board does not approve this application today, then the PILOT is ended by its terms and will be returned to the tax rolls. Wellford asked if the applicant could reapply for a new PILOT, to which Carpenter confirmed that the applicant could do that, but the applicant would have to undergo the current underwriting procedures, which require a minimum of 50% of acquisition costs to be invested into the property in improvements. Cliff Henderson asked for confirmation that if the Board approves this application today, if that would make the additional ten (10) year term retroactive back to September 3, 2025, to which Carpenter confirmed. Howard Eddings, Jr. stated that the distinguishing characteristic is the difference between expiration and termination and asked if there is a process that the Board’s staff or legal counsel goes through at the time of expiration that would terminate the PILOT at that point, or is that something that happens with the PILOT Lessees. Carpenter stated it happens on both ends, and that it is the PILOT Lessee’s responsibility to track the term of the PILOT, and there is notice given early in the year as Board staff and legal counsel review its records to see what PILOTs are due to expire within that year, and would provide notice to the PILOT Lessee and it is the Lessee’s responsibility to follow up by filing an application for a PILOT Term Extension, when applicable and allowable. Carpenter reminded the Board that the PILOT Lessee does not have to wait until the original ten (10) year term has expired to apply for a PILOT Term Extension, and a PILOT Term Extension Application can be applied for at any time during the original ten (10) year term, where applicable, but in this case, the PILOT Lessee did not timely follow up, which they can address and if there is good cause for that failure after the expiration of the PILOT. Carpenter advised that there is a process that his office goes through to terminate the PILOT of record and notify the taxing authorities for the City and the County, and in that process is when this PILOT Lessee realized and were notified that his office was going through this process and indicated that they would like to continue in the PILOT program, then filed the PILOT Term Extension Application, and based on the Board’s procedures, this would be the first time the Board would consider this application.
Trey McKnight stated that the email notice that staff sends out is a courtesy to the PILOT Lessee. Wellford stated that he agrees that staff notice to the PILOT Lessee is not a legal requirement, and it lessens the responsibility, and he certainly does not want to provide an undeserved benefit like an additional few months of a PILOT Term, but he understands that is not the case and the term would be made retroactive back to September 2025, which would solve that problem, but he is uncomfortable providing a precedent to someone coming in after the PILOT has lapsed. Wellford stated that this is a unique enough scenario that if the Board’s legal counsel thinks it is legally valid, and since this would be retroactive back to September 2025, he supposed he can support it, although he is uncomfortable with it, he can support it.
Cliff Henderson asked for confirmation that PILOTs are not taken off the tax rolls until Carpenter’s office prompts that action to remove it, and the taxing authorities are not automatically terminating the PILOT at the expiration of the term. Wellford asked if this is a legal requirement or a practical matter of the taxing authorities. Carpenter stated that this is a matter of practice because his Firm and staff review this information more than anyone else, and there are personnel changes at the various government offices involved, so the continuity with all of this happens through the Board, staff, and his Firm. Carpenter stated that mistakes do happen, but the consideration for the Board is whether it is balancing the equity to the tenants, to the developer, and to the program and is there sufficient cause to allow this mistake to go forward where the property stays in the PILOT program, and if there is more equity achieved with the property staying in the program or being out of the program. Carpenter stated that the property participates in the Safeways program, which is considered locally as a premier security program that adds benefit and safety to the tenants that live there, as well as other tenant benefits. Carpenter stated that the Board has seen other properties that either graduate from the PILOT program and it does have a negative impact on those properties. Carpenter stated that administratively, his Firm has no recommendation; he has presented this issue to the Board, and the applicant is in attendance to present their case, and the Board has full discretion whether to go forward or not.
Henderson stated that Jobe indicated that as soon as he and his client realized the issue, the PILOT Lessee immediately applied for the PILOT Term Extension and he does not believe it was their intent to terminate, and he would say for future, as staff or legal counsel provide notice, to require a response. Wellford stated that he does not want any misconceptions, and he agrees that no one did anything nefarious at all and understands that, and it makes practical sense to vote to make this retroactive back to September 2025, but if someone were to legally challenge this, he wants to be assured that Carpenter is providing legal advice and not practical advice of what the Board is empowered to do. Eddings stated that he does not want ownership responsibility to be placed on the staff. Henderson stated that if the Board’s staff and/or legal counsel are initiating the termination, we need to ensure they are getting the response necessary from the PILOT Lessee, and if this was something that the taxing authorities were initiating, he would agree, but if Board staff and legal counsel are initiating the process, it needs to get sufficient response before action is taken. Eddings stated that if there is no response, then would it not be a safe assumption that the Lessee does not have intentions of extending the term?. Corbin Carpenter added that emails distributed include “Please confirm receipt”, and if no response is received in a reasonable amount of time, then the email is re-sent by either staff or his Firm.
Mark Jobe stated that he completely understands the Board’s consideration, but he cannot locate the March 2025 notice provided by staff, and again, that is not passing the buck to staff, but he cannot find it and was not aware of that. Jobe stated that personally, he feels that his communication with staff is very responsive, and he addresses every correspondence to him for his clients. Jobe stated that he cannot speak to the March 2025 communication as he cannot locate it, but that would be the explanation of not acting under receiving the November 2025 communication, and his immediate action to correct course. Luis Rodrigues stated that he is present today representing the ownership group for Dogwood Trace Apartments. Rodrigues stated this his group has been very committed to this Board and has three (3) additional properties that participate in the PILOT program, and he is always grateful for the Board’s collaboration and support. Rodrigues stated that first, he assumes any mistake and any responsibility that has to do with this, and the ownership group slipped, which is the honest thing to say, and he does not know when or how. Rodriges stated that once notice was received in November, ownership acted immediately and is committed to its communities and the families that live in those communities. Rodrigues stated that ownership has invested quite a bit of resources in each project, but particularly in Dogwood Trace Apartments, where safety and security are very important, and it is evidenced in the application that many of the resources are dedicated to that and ownership wants to continue to do that.
Vincent Sawyer asked if there is a general timeframe between term expiration and termination and what needs to happen with the taxing authorities, because this window has basically allowed this to happen. Carpenter responded that the general timeframe is sixty (60) days, but there is no hard fast timeframe. Carpenter stated that the policies and procedures that are developed have been developed at his Firm’s urging with the Shelby County Trustee’s Office and the City Treasurer’s Office, and unfortunately those two offices do not really communicate with each other as they have different systems, and the Shelby County Assessor’s Office is part of this group, and this office has shown some leadership, but his Firm has been the ones coordinating all of this and making sure that it operates properly. Carpenter stated that the City and County also track these PILOT properties differently so there is a lot of coordination that is involved as his Firm stays on top of this, but there is about a sixty (60) day window to get everything completed through all entities. Sawyer stated that if the timeframe, however specific it is, is inevitable, then he believes the Board should set up some policy that includes factors such as egregious behavior going forward. Wellford stated that just like it is the PILOT Lessee’s responsibility to apply for a PILOT Term Extension in a timely manner, and while not placing blame on the Shelby County Trustee, Assessor, or City Treasurer, but legally a property that has a tax exemption has a specified timeframe, and legally, should those offices not be the ones who are monitoring this, and once the PILOT expires by its terms and the property deeds reflect that, those offices should be responsible for putting the property back on the tax rolls. Wellford stated that he is not suggesting that the Board’s legal counsel should not initiate these terminations to be a good cooperative partner, but under the law, Wellford asked are the taxing authorities the ones who are supposed to place properties back onto the tax rolls. Carpenter stated that he cannot speak for those offices, but stated that these PILOT terms do not just expire at the end of the year, and that terms expire throughout each year based on the terms when the property comes into the program and are taken off the tax rolls, and it takes coordination. Carpenter stated that different offices and elected officials all have differing views on PILOTs and whether PILOTs are doing what they are supposed to do, and this Board is not the only entity that issues PILOTs. Carpenter stated that based on what the Shelby County Commission PILOT Ad Hoc Committee looked at, there are approximately ten (10) PILOT granting entities in Shelby County, and he cannot speak to how those entities operate. Cliff Henderson stated that he is comfortable with continuing with the Board’s legal counsel prompting this because different things can happen, and no one knows if an email address was inadvertently mistyped, or if staff had the wrong email address since it was a PILOT transfer, but things happen and an email could be in someone’s trash folder, and that is why there needs to be backup to go and make a call. If that is the process, Henderson stated he is comfortable keeping the prompt of termination with the Board to avoid confusion with the taxing authorities. Henderson stated that this is a lesson learned and let's take what the Board needs from this and move forward.
There being no further questions or comments,
Monice Hagler made a motion to approve the Affordable Multifamily PILOT Term Extension Application for Circulo Dogwood, LLC (d/b/a Dogwood Trace Apartments) to be made retroactive to September 3, 2025. Cliff Henderson seconded, and the motion passed by majority after proper roll call vote of the Board members
Chairman Reid stated that this is sloppy, and while he appreciates where ownership is coming from, he does not want to this to set a precedent and voted no on this agenda item.
Let the record reflect that Daniel Reid and Courtnee Melton-Fant voted NO.
Mark Jobe and Luis Rodrigues left the meeting.
11. Bond Inducement Resolution for University Place Preservation, LP (d/b/a University Place Family; f/k/a University Place II & III)
Carpenter introduced this agenda item, stating that Action Items 11, 12, 13 and 14 are all applications submitted and sponsored by MHA and McCormack Baron Salazar and may be discussed as University Place Family and University Place Senior, but must be voted on separately. Carpenter stated that these properties are current participants in the MHA PILOT program administered by the Board and the properties that were constructed in 2007, commonly known as University Place Family, and constructed in 2006, commonly known as University Place Senior, each being a part of the HOPE VI grant to MHA, and invited representatives in attendance to introduce themselves and provide additional comment. Archie Willis began, stating that his company, ComCap Partners, is the local development partner with McCormack Baron Salazar for over twenty years and have been involved in all of the HOPE VI developments, which include University Place, Legends Park, and South City. Willis stated that these University Place projects are at the point where they need to be renovated, as they were all built as new developments in the early 2000s, and they need to be recapitalized and additional renovations made, in addition to their current PILOTs expiring. Willis stated that there are three phases of University Place, but University Place II and III multifamily phases have been combined into University Family, and then University Place Senior is a standalone senior development with 118 units, which was the first phase. Willis introduced Kelly Dervarics, project manager, and Brock Armstrong, Senior Vice President Risk Management, both of McCormack Baron Salazar. Willis stated that these are complex projects with MHA support and the RAD conversion and other parts, but the Board has seen this process with its work on College Park and the RAD conversion, and there are likely similarities with those projects and these.
Kelly Dervarics stated that as this team is combining the two multifamily phases, University Place II and III, and the project is going through a RAD conversion with HUD, which will convert all public housing units onsite right now to Section 8 Project Based Rental Assistance (PBRA) units and the property will become a 100% affordable property for multifamily, and through this process, the development team wants to cover a substantial rehabilitation of all of the family units. This renovation will include new mechanical systems, new windows, new roofs, new energy efficient appliances, new finishes, and catching up on all deferred maintenance, and learn from issues that management has experienced with these buildings to provide market rate quality apartments for the existing residents. Dervarics stated that tenant benefits include increased security, and installing McCormack Baron Salazar’s typical standards for new construction, which is security surveillance videos throughout the property. Dervarics stated tenant benefits will also include providing supportive services with their partner Urban Strategies, which are already onsite, but that will continue being available to residents, as well as adding solar through taking advantage of the solar tax credits to provide solar panels and solar carports on both the family ad senior projects, which will help with utility costs.
Brock Armstrong stated that University Place Senior’s current PILOT expires May 10, 2026, so that new PILOT application submission being considered today for University Place Senior includes a rehabilitation of the project, but there will be that time period where the transaction will not be closed until later this year 2026 due to the application timelines and award allocations with THDA, and the current PILOT term will be expired. Armstrong asked that based on the Board’s earlier discussion on PILOT term expirations, should the developer be requesting a term extension at this point or is that not something that is feasible in this case? Carpenter stated that based on his Firm’s understanding of the application and discussion preliminarily, he would recommend to move forward with the PILOT application prior to the PILOT term expiration and if approved, there is a process that takes place, and hopefully during that time period, THDA will announce Round 1 allocation awardees, and this development team will then have the opportunity to make a determination on how it will move forward. Carpenter stated that in this circumstance, the Board does not have the authority to extend this PILOT term beyond its current term.
Buckner Wellford stated that there is discussion about relocating residents during this rehabilitation and asked for further explanation on that from the development team, particularly for the University Place Senior development residents. Dervarics stated that the management team began with MHA resident meetings with both the senior and family residents and there will be a designated relocation consultant, Development Resource Partners, of whom McCormack Baron Salazar has worked with for other relocations around the country, and they will first be looking at existing vacancies to start the rolling rehabilitation, and ideally senior residents will only be moved once into a new rehabilitated unit, but there will be the possibility of some residents being moved offsite, but they will have the right to return at the time that is deemed necessary from wherever management has offered them to relocate. Wellford asked if senior tenants are getting preferential treatment in the sense of not having to move offsite. Dervarics stated that because University Place Senior is one building, it is easier for seniors to not have to move them very far, and just down the hall, when possible, whereas the family units will be more complicated in terms of what blocks are vacant, but management is still trying to minimize the people that will moving offsite versus moving into a renovated unit. Armstrong stated that management will be able to utilize those units as placeholders to move residents into just to keep them onsite, but one challenge will be that there are some larger 4-bedroom units that may be a bit more complicated, but other MHA Senior projects have indicated that they do have some availability for seniors to be relocated in some other senior projects. Wellford asked if MHA is actively involved in this process of relocation of seniors, to which Armstrong confirmed.
Dexter Washington of MHA stated that this is a RAD conversion property and as discussed with other projects, MHA is hopeful in the next five (5) years to be out of the public housing space, as these conversions allow the funding platform to change from a Section 9 to Section 8, which is a more stable funding platform for these properties, and they will see a rather significant increase in operating revenue through the conversion and the relocation. Washington stated that typically, once a development gets started down this road, vacancies occur within these buildings, and it is suggested to allow those vacancies to remain to that management has a place to move residents during this construction process. Washington stated that MHA currently has just under 1,300 other public housing units, and a good portion of those are senior units that MHA can reach out to those properties as partners.
Wellford asked who pays the expenses for a resident to move and relocate, whether to a new unit or offsite. Washington stated that relocation expenses are part of the development costs for the projects. Washington echoed Dervarics comments stating that anyone that is moved offsite has a right to return back to the property, but also MHA will be relocating under the Uniform Relocation Act (URA), so all those policies will apply to these people and all the moving expenses, utility transfer fees, and other related costs will be covered under that Act. Willis stated that this is an excellent point of concern, which we all share, and not to sugar coat thing because relocation is challenging, but this development group has completed this type of work with many other projects and it is the developer’s commitment to this Board to mitigate those challenges as much as possible, and in working with MHA and their other stock of housing, there must be a degree of compassion because we are dealing with a population that needs to have compassion and he certainly appreciates people having concern, and the development team will do their best to mitigate the challenges and make it as seamless as possible.
Howard Eddings, Jr. asked if the URA also applies to the multifamily residents, to which Washington confirmed yes. Eddings asked if the family decides not to return, if the Section 8 voucher runs with the site or the individual bringing the voucher with them and gave the example of a family that moves offsite and decides they do not want to move back, Eddings asked what happens to that newly renovated unit in terms of affordability status. Dervarics stated that the newly renovated unit will be either a tax credit unit or a PBRA units, and management would anticipate that unit to be rented to a new family and the new family would receive the benefit of that unit, whether it is a tax credit unit or a PBRA unit. Eddings asked if families can only rent if they have a voucher or can a family rent at the market rent. Armstrong stated that the unit mix at the family site is 25% PBRA Section 8 units and the balance of the units are restricted to residents at or below 60% AMI, so any family that would qualify under the 60% AMI requirement would be eligible to rent that unit without a voucher. Eddings asked if there are limitations around if families choose not to move back that are Section 8 voucher recipients, can management then move that particular unit up to the 60% AMI. Armstrong replied that as long as the family qualified, yes, and that would also apply to the senior units.
Carpenter reminded the Board that it worked through the RAD conversion with a couple of other MHA properties, and it worked out. Carpenter stated that those projects are in the construction phase now, put prior to this RAD conversion program, the rehabilitation and capital needs of all of the public housing was taken care of by the federal government and it would allocate a certain dollar amount each year for those, and based on experience, those allocations were not keeping up to allow these properties to maintain at the level that they should be maintained at, and although the public housing facilities had equity, they could not take it out and use it for the rehabilitation and upkeep of the property. The RAD conversion program changed that model and now the public housing facilities can use their equity to be leveraged to help maintain and stabilize these properties, which has been indicated with the financial performance of the RAD conversion as there is more money available to maintain and support the properties, and that is a good thing.
Carpenter stated that this is a teaching moment, and that some advocates and tenant groups think that when these properties are built or when a substantial rehabilitation is completed, that this is all that is needed and the properties will be good from that point, but that is not the case, and with this particular example, these projects were new construction, but years later, they need to be substantially rehabilitated again, and preservation may not last that long. This is why under the federal tax law, there is a fifteen (15) year compliance period, because it recognizes that after that period, the project needs to have a new recapitalization, new financing, and new rehabilitation, and the Board is seeing a lot more of this come through. While the RAD conversion program is still fairly new, and the projects are under construction, his Firm believes this will be a much better model to use than the old way of doing things. Armstrong added that on the RAD conversions, there is a certain level of rehabilitation that is required, so on the University Place Senior project, the cost is over $110,000 per unit that is being put back into the new development, and for University Place Faily, the cost is just under $90,000 per unit. Carpenter stated that his Firm is in support of both bond and PILOT applications, and as previously discussed, both projects will be required to come back with a Final Bond Resolution authorizing the execution of both projects.
There being no further questions or comments,
Vincent Sawyer made a motion to approve the Bond Inducement Resolution for University Place Preservation, LP (d/b/a University Place Family; f/k/a University Place II & III). Cliff Henderson seconded, and the motion passed unanimously after proper roll call vote of the Board members
Let the record reflect that Monice Hagler is recused.
12. Affordable Multifamily MHA PILOT Application for University Place Preservation, LP (d/b/a University Place Family; f/k/a University Place II & III)
There being no further questions or comments,
Vincent Sawyer made a motion to approve the Affordable Multifamily MHA PILOT Application for University Place Preservation, LP (d/b/a University Place Family; f/k/a University Place II & III). Cliff Henderson seconded, and the motion passed unanimously after proper roll call vote of the Board members
Let the record reflect that Monice Hagler is recused.
13. Bond Inducement Resolution for University Place Senior Preservation, LP (d/b/a University Place Senior)
There being no further questions or comments,
Vincent Sawyer made a motion to approve the Bond Inducement Resolution for University Place Senior Preservation, LP (d/b/a University Place Senior). Cliff Henderson seconded, and the motion passed unanimously after proper roll call vote of the Board members
Let the record reflect that Monice Hagler is recused.
14. Affordable Multifamily PILOT Application for University Place Senior Preservation, LP (d/b/a University Place Senior)
There being no further questions or comments,
Vincent Sawyer made a motion to approve the Affordable Multifamily PILOT Application for University Place Senior Preservation, LP (d/b/a University Place Senior). Cliff Henderson seconded, and the motion passed unanimously after proper roll call vote of the Board members
Let the record reflect that Monice Hagler is recused.
15. Status Updates for PILOTs in Legal Default:
a. Bridgeport Manor
Carpenter began by stating that his Firm and Board staff received a letter on February 3, 2026 from Evans Petree Law Firm, legal counsel to this PILOT Lessee, on the refinancing that the Board has been discussing for an extended period of time for Bridgeport Manor. Carpenter invited representatives to provide a status update. Elizabeth Friary stated that she is in attendance, and that her partner Frank Stockdale Carney was unable to attend today’s meeting due to a long-planned vacation. Friary stated that she is joined in her attendance by David Porteous of Evans Petree Law Firm and Mendel Fischer, the PILOT Lessee. Friary stated that the letter before the Board is asking permission for a variance under the PILOT Agreement for permission to assign one (1) parcel to another entity, but there would be no change to the PILOT Agreement, and this is simply for refinancing purposes only and would not impact the PILOT or any liability, compliance liability, or compliance issues and a default on one parcel would trigger default on both, so there would be two leases. Friary stated that this has been done once before, although it was a little different in that that was deeded out prior to or at the same time that the PILOT was applied. Friary stated that there was a typographical error on the letter before the Board regarding the first parcel number referenced. Friary stated that what is being requested is to deed one of the smaller parcels to Cambridge Holdings I and have that for purposes of refinancing.
Carpenter stated that this Boad has been looking at refinancing applications for this project for more than eighteen (18) months and there have been one or more deadlines to close the refinancing and each time that deadline appears, there is some reason as to why it cannot close. Carpenter stated that last fall 2025, there were assurances to the Board that everything was in place, the lender had performed a site visit, all underwriting had been completed and at the Board’s November 5, 2025 Board meeting, the Board gave today’s meeting as a final deadline for the refinancing to be closed because it has been stated that the funds from the refinancing would be needed to complete the renovation of the project. According to his notes, Carpenter stated that the Board was not going to be looking at any variances today, but was only seeking confirmation that the refinancing loan had closed and review the timeline of how the property plans to move forward, but instead, the Board is receiving a letter asking for more consideration and more time.
Mendel Fischer stated that Carpenter Law has likely seen a bunch of documents going between his lenders, and when he was before the Board in November 2025 and the Board required a drop-dead date be put on the refinancing closing, he agreed because the current loan matured January 1, 2026, so as of today, he is in default with his current lender as far as timing. Fischer stated that the initial lender for the refinancing, Santander, came back to him the first week of January 2026 with the commitment, but Santander lowered the amount of the proceeds for the refinancing, so the whole idea was that there would not be enough proceeds to do both, so he right away approached another lender to be able to do both of them simultaneously to close like this would have the same amount of proceeds when he is doing the same thing. Fischer stated that as far as he knows, his transaction counsel, Michael Bernstein, along with Frank Stockdale Carney, are working on how to technically keep everything the same as the lender is sourcing. Fischer stated that he did this at Eden Pointe where he got a joinder, and it seemed like it was very simple because there are two (2) parcels on the land and when he was discussing the whole entire financing. Fischer stated that all the loan documents are signed and everything delivered, if he can get this done to basically close and everything is just waiting on the signature of the PILOT. Fischer stated that he knows he is in a race with time, and this started the first week of January and the amount of time that Carpenter Law Firm has put in over the last couple of weeks and many phone calls and how to present this, and David Porteous was added for some technicalities as a real estate lawyer in Memphis and how to clarify or simplify this, but as of right this second, everyone signed on Monday, February 2, 2026 and he just awaiting the signature of the Board to fund it.
Corbin Carpenter stated for clarification purposes for the Board to the material difference between the Eden Pointe transaction and this transaction are not the same. Corbin Carpenter stated that with Eden Pointe, there was a real estate transaction with no PILOT, and the PILOT Lessee is making a request for a similar transaction to occur with an active PILOT now in place, which changes everything. Corbin Carpenter stated that the Board has never approved a situation like this and this is a matter of first impression, where there is an active PILOT that the Board would consider allowing an assignment of one of the parcels to an unrelated entity that the Board has not done business with before, and that is why he asked Evans Petree to provide a formal request in writing for the Board to digest this. Corbin Carpenter stated that this structure is not one that the Board has done before and his Firm does not recommend that the Board favorably consider this variance request because it could have adverse impacts on not only administrative files, but the local taxing authorities’ record keeping as well. Corbin Carpenter stated that the decision is up to the Board, but he wanted to make those clarifications for the Board that this is not the same type of transaction as is being referred to by the PILOT Lessee for Eden Pointe Apartments.
Vincent Sawyer asked if the same issues are present with the alternative approach presented in the letter with the sublease structure. Corbin Carpenter stated that the sublease structure that is being proposed is a structure that is utilized with MHA PILOTs, but with City of Memphis HEHF Board PILOTs, that sublease structure to other entities is not utilized. Corbin Carpenter stated that leases with tenants are one thing, but other legal entities with ownership; the Board has never used the sublease structure to other entities. Stephanie Bryant asked for confirmation that any change in ownership entity would trigger a PILOT Transfer, to which Corbin Carpenter confirmed yes, and that is what he expressed to the PILOT Lessee’s legal counsel. Elizabeth Friary stated that this is not a transfer and these are the same folks, there would be no obligation changes under the PILOT agreement, and it is under the lease. Friary stated that there are two separate parcels, the larger parcel is largely completed and 85% occupied, and this refinancing would give them the financing to complete the over 200 remaining units on the second parcel and get those active in the PILOT program. Friary stated that the PILOT agreement permits an assignment with the Board’s approval, and it says it will not be unnecessarily or unreasonably conditioned, withheld or delayed. Friary stated that they are not trying to change anything and the Cambridge I Holdings, the proposed other entity, has the same owners with Mendel Fischer as 95% owner and his brother as 5% owner, and there is no trying to get around any obligations under the PILOT here.
Stephanie Bryant stated that the Board has actually addressed a situation like this before, approximately two years ago, but there was a change in entity only, with no changes to ownership members, and the Board required a PILOT Transfer Application to be submitted in that situation, and it was coupled with a PILOT Refinancing Application on the same agenda. Bryant stated she would need to go back and review the Board’s records for the correct property as a reference. Wellford asked how the entity is being changed. Friary stated that Cambridge Holdings is going to continue to be the obligated entity under the PILOT agreement and what you have is a second lease, and Cambridge Holdings would assign the lease for that one parcel to Cambridge Holdings I, and there is not a request for an assignment of the PILOT in any way, and a default on one would default both and they would have that in the lease. Cliff Henderson asked what is prompting the split. Friary stated that the financing is prompting the split because it is two lenders. Fischer stated that Corbin Carpenter is correct that with Eden Pointe, he closed the financing and the PILOT at the same time, and there was a joinder with one PILOT Lease with the two parcels and did a joinder with both lenders. Fischer stated that one of the challenges he has with the larger properties is that there is a certain limit or cap with lenders in Memphis and he understands that and for the refinancing of 432 units, Santander is funding $27,500,000, but his goal was to get to $32,500,000-$33,000,000, but Santander did not fill the gap with the last underwriting. Fischer stated that the idea was to finish the property and he did not bring in a bridge lender because it is a little more complicated so now Santander will own the larger parcel, and Riverton Capital will own the smaller parcel, all documents are all signed, and it is just a technicality with he and the Board that would be considered. Fischer stated that Cambridge Development is one company, and they just did Cambridge Development I, and it is the same owners, same people, same property at the end of the day. Fischer stated that this is just a technicality how we register it now, because even today, there are two tax lots, two tax payments, so it is all there, and David Porteous’ letter summarizes how the Board is very able under the PILOT of just putting whatever the subdivision legal of being the same PILOT, just one holding one and one holding the other.
Corbin Carpenter stated that he would like to correct a statement made by Fischer that just because a transaction is done contemporaneously that it is the same thing, that is not correct. Corbin Carpenter stated that Tennessee is race-notice state, so whoever records first wins the priority, and all of the real estate matters were done before the PILOT was consummated. That is why this is a matter of first impression for the Board. Corbin Carpenter stated that as this is a matter of first impression, it is not one that his Firm recommends, but the Board must also factor into the City and County taxing authorities.
Henderson asked for confirmation that the original target for refinancing with Santander was $32,000,000, to which Fischer stated the original target with Santander was $32,500,000. Henderson stated that what he is seeing in this letter before the Board dated February 3, 2026 look like the new target is $34,900,000, which is an increase of $2,400,000. Fischer stated that Santander is willing to loan $27,400,000 and Riverton Capital is willing to loan $7,500,000 because he is putting in a large interest reserve fund for it because they are a bridge lender. Fischer stated that there will be two separate closings and it is more money for him, but he is willing to do anything at this point because he just really needs to close. Henderson stated that he is speaking on behalf of himself, but when someone comes in with something like this last minute, there is a bump up in proceeds, which throws the sources and uses off; he just does not feel good about it.
Henderson stated that putting aside everything gone through to get to this point of splitting this up just does not feel right. Fischer stated that he does not think this is a shuffle because this is something that the Board would have discussed with its legal counsel once he got the final amendment on January 8, 2026, and this did not just come up last night in thinking this is what we need to do for tomorrow. Fischer stated that the deeds of trust were already sent back to the Board’s legal counsel. Friary stated that her office sent the deeds of trust at some point last week or the week before to the Board’s legal counsel, and this proposed structure was verbally discussed with Corbin Carpenter on January 12 or 13, 2026. Corbin Carpenter stated that his Firm has worked in good faith with Evans Petree for years and has agreed to do so until it received this new change. Corbin Carpenter stated that when the Board met on November 5, 2025, the Board had an understanding that this PILOT Lessee would come back before the Board at today’s meeting and the Board moved forward with a basic set of facts, and those facts changed a couple of weeks ago, and while he understands that the PILOT Lessee is living with this, the Board is not and this matter has been ongoing for several years now, and his Firm has given the opportunity for the PILOT Lessee to come present its case to the Board, and that is what everyone is here to do, but as Board legal counsel, he does not support this.
Chairman Reid stated that the original PILOT was approved in 2021, and in looking back to the PILOT Lessee’s last status report to the Board, Chairman Reid recalled the Board allowed this additional time between the November 5, 2025 Board meeting and today’s Board meeting to have this refinancing completed. Mendel Fischer stated that if this refinancing does not go through, he does not want to lose the PILOT and he will just proceed and close with Santander and then maybe come back to the Board, but that will create a delay in construction. Fischer stated that he will be ablet o build and have some money, but right now he has an opportunity to take this loan from a very large rate, he has invested tens of millions of dollars in Memphis, and he is finally sitting at the finish line with all documents signed, and he is just trying to navigate this. Fischer stated that if the Board is saying that this is something that needs to be restructured differently to bring two lenders in, because Santander will only be the lender on one parcel and will not be securing the second parcel, so if that is not approved today, he will have to put together another application, go through the 45-day due diligence period of the Board, and this would cause a delay of 3-5 months and he does not want to do that because he wants to finish the project. Fischer stated that this is the last large project that needs construction, and he is thankful for everything he has done until today as he has quite a few projects in Memphis and he has done well with them, the Board is doing well with them, the tenants, the people, the security.
Vincent Sawyer asked, putting the additional $2,400,000 and changes to the sources and uses to the side, when Fischer states that they are basically closed, is he referring to both loans. Fischer stated that Santander is ready, and Riverton is ready, and Santander has already signed, he has signed, and everything has been sent back to the bank, that he has all the loan documents, and everything is ready today, so they are both ready and just waiting for the signature from the Board. Sawyer stated that he agrees that the Board has been dealing with this for quite some time, and it seems that we are apparently at the finish, and he is trying to understand the complications that a sublease would present. Sawyer stated that he understands the initial request and understands the issues clearly, but he stated that the Board has been cited a policy on subleases not being withheld, so he would like some clarity on exactly what issues a sublease presents to the overall operations of the Board and the property itself.
Carpenter stated that many times, particularly with this developer, the Board gets to the point of the meeting, and the Board discusses issues that did not get the project to this point in the first place. Carpenter stated that this project is in legal default and has been since April 17, 2025. Carpenter stated that this developer has been given opportunities to cure, and the PILOT Lessee gives the Board information and deadlines, but when it is time to produce the results of the commitments, the Board gets another wrinkle that comes in and the Board goes to discuss that wrinkle and not holding the developer to the commitments and promises that have been made to get to that point. Carpenter stated that his office has been attempting to close this refinancing transaction for quite some time, his office has never spent this amount of time on a refinancing, and PILOT Lessee continues to state that closing is imminent and will happen within 30 days, but it never does, and that is why we are here today, and now the Board is discussing further extensions of time.
Fischer stated that he is not asking for an extension of time, he is only asking for an approval of the deed of trust and then it is funded. Carpenter stated that the Board does not have anything from the lender stating that, and he understands that Fischer has verbal representations that he is making. Friary stated that her office sent Carpenter’s Firm all the deeds of trust. Corbin Carpenter stated that deeds of trust is only one part of the transaction, and the Board has documentation that his Firm must draft that is applicable to this transaction. Friary asked if Corbin Carpenter was referring to an Amended and Restated PILOT Agreement. Wellford stated that Carpenter’s Firm would have to prepare two separate leases in order to do this, and while he is not saying that is impossible to do, but then the Board has thirty (30) days to approve its meeting minutes, so the point is that things cannot just be done today. Following up on Sawyer’s earlier comments, Wellford asked if the PILOT Lessee is asking for two separate leases. Sawyer confirmed that it seems they are asking for two separate leases or a sublease. Fischer stated that it is just legal terminology. Wellford stated that is important, and he has been as hard on this PILOT Lessee as anyone, but he is just trying to understand what the legal impact is of splitting this PILOT into two separate leases instead of one, where is priority secured and does the Board have priority. Carpenter stated that the most direct approach is that this is not in the Board’s policies and procedures and the PILOT Lessee’s view is that this is a plain real estate transaction, and if that was the case, his Firm would agree, but it is not because this is a PILOT property, this type of transaction is outside of the Board’s policies and procedures, so there has to be some variance granted by the Board, upon the terms that the Board will determine to be reasonable. Carpenter stated that his firm is not arguing one way or the other, it is only stating that this is not included in the Board’s policies and procedures, the PILOT Lessee is asking Carpenter Law to do it, but it cannot do it without the Board’s approval, which is why the PILOT Lessee is presenting their case to the Board today. Carpenter stated that if the Board decides to move forward on certain terms and procedures, legally his Firm can find a way to make it work, but his Firm cannot just change the policies and procedures of the Board, and that is the real issue.
Wellford stated that the policies and procedures of the Board do give the Board discretion to do this. Carpenter stated that the Board does not have a policy regarding this, but the Board does have the discretion to make reasonable exceptions to any existing policy. Wellford stated that he does not want to do anything that puts the Board at a legal disadvantage, but if this would not put the Board at a legal disadvantage and if the result if that the Board is securing a stream of funding that will do what needs to be done for the construction at both parcels, he is open to the idea, although he agrees with Henderson that he does not like this and the Board keeps getting things at the last minute, but he is open to the idea. Wellford stated that he does not want to penalize the developer on this request because the Board has had frustration with this developer and this project and how long it has remained in legal default. Wellford stated that he is trying to divorce that from the merits of what is being proposed. Wellford stated that what he understands that the Board’s legal counsel is telling the Board is that there is not a legal impediment, but that Board legal counsel is not recommending that the Board exercise the discretion to do it.
Vincent Sawyer stated that he does not like the two separate lease approach, but he is interested in learning more about the potential implications of the sublease approach because a sublease from the Lessee does not implicate the Board’s rights to that lease. Carpenter stated this his Firm can make it work if that is the Board’s will. Corbin Carpenter stated that the other point he was trying to explain is with the local taxing authorities; they have certain systems that will apply. Wellford stated that there will be a lot of legal work on Carpenter Law Firm’s behalf, so if the Board decides to go forward with this, it is his opinion that the PILOT Lessee would need to pay those legal expenses. Wellford stated that the Board would be asking legal counsel to do an unusual transaction that takes additional time, and the Board should not be paying for that.
Chairman Reid asked Stephanie Bryant to provide an update on where legal expenses incurred by the Board stand regarding this developer. Bryant stated that following the request made by Wellford at the Board’s November 5, 2025 Board meeting, she prepared a breakdown of legal expenses and external monitor expenses incurred by the Board and the results were as follows: estimated total legal expenses from September 30, 2024 to December 2025 are $42,765.50 across this developer’s portfolio; estimated total external monitor expenses from February 2025-December 2025 are $10,360.00 across this developer’s portfolio, for an estimated total expenses incurred by the Board of $53,125.50 across this developer’s portfolio. Wellford stated that these expenses would be plus the legal work to potentially prepare two separate leases. Bryant stated that these totals do not include January 2026 expenses and are only through December 2025.
Sawyer stated that he needs more information about the additional $2,400,000 of sources of funds and would need to compare and is not ready at this point to move forward with this. Henderson stated that the point he is making is if the goal line changes and other things change at the last minute. If he were an investor, he would not be involved with this. Hendersons stated that as a representative of the public, the Board is weighing the there are 200+ units remaining to be renovated and the funds are there, does the Board move forward. But as an individual, he does not want any part of this, the way it has been handled. Fischer stated that if this refinancing does not go through and signed today, he is at risk of losing the property because the interest rate on the property is at 17%, so he will have to make a decision to leave the PILOT and take 636 units from the PILOT program, and assess what needs to be done because he has to close.
Bryant advised the Board that the PILOT Refinancing approval is only valid for a six (6) month period, and as this approval was granted on June 4, 2025 and the Board did not hold a January meeting, the approval would extend to today’s meeting, so the Board would also need to determine if it will allow additional time to close the Santander loan, as originally approved. Bryant stated that she understands that this may complicate matters, but it is required under the current policies and procedures for that PILOT Refinancing authorization to be valid after today’s meeting. Trey McKnight stated that the Board does not have to make a decision on the rest and the Board has given this PILOT Lessee many, many bites at the apple and if the Board is not comfortable making a decision, then the Board would need to make that understood. Wellford stated that the effect of not having a vote would mean the property would remain in legal default, a Board member could move to terminate the PILOT, or the circumstances may take care of themselves, as just stated, which is not a good scenario for anyone. Wellford stated that he is the last person that wants to push this out another month, and he believes the PILOT Lessee should have to bear the costs associated with doing what is being discussed. Henderson stated that he would not go through with this personally if someone changed matters like this at the last minute of the transaction, and he does not believe the Board should either. Henderson stated that the Board’s legal counsel is advising the Board that it has not had reasonable time to review this, the Board has received a letter from the PILOT Lessee’s legal counsel dated less than 48 hours ago saying what is being proposed, and there is more money on the table now. Monice Hagler stated that the Board has never received anything from the lenders, no confirmation of commitment letters, or any other materials. Friary stated that those were sent a couple of weeks ago. Corbin Carpenter confirmed that deeds of trust had been sent. Hagler stated that a deed of trust is not a commitment letter. Friary stated that the commitment letters were shared on January 13, 2026. Bryant stated that no documents have been shared with the Board staff until the letter that was submitted for the Board’s review and consideration on February 3, 2026. Friary stated that she means that term sheets were shared on January 13, 2026. Chairman Reid stated that there is a lot of difference in a term sheet and a loan commitment letter. Fischer stated that the term sheet actually says term sheet and loan commitment.
Sawyer asked if the initial Santander loan was actually denied or is this an alternative approach to try to get additional funds. Fischer stated that Santander modified the loan commitment. Sawyer asked if this letter indicates a modification that Santander is requiring of Fischer as the PILOT Lessee at the last minute. Fischer stated that at the initial underwriting Santander performed, the loan amount was $32,500,000, but following the latest underwriting, that amount was reduced to $27,400,000, so he resigned all the documents. Sawyer asked when this happened. Fischer stated in December 2025, but pretty much the first week of January 2026, he got the last commitment letter, around January 7 or January 8, 2026, when he received the final commitment from the bank. Sawyer asked if that final commitment indicated the reduction to the $27,400,000, to which Fischer stated yes. Sawyer asked if up to that point on January 8, 2026, Fischer thought the proceeds were going to be $32,500,000. Fischer stated that he and the lender were going back and forth, and the interest rate being one number, then another number, and how he felt comfortable with the market and how it's going to come down. Fischer stated that Santander is not a regular bank in Memphis and is not a Fannie Mae or Freddie Mac lender and is a regular bank. Sawyer asked Fischer that on January 8, 2026, Fischer found out Santander’s loan proceeds were $27,400,000, and Fischer spend the remainder of this time up until today securing another $7,500,000 to make up the difference. Fischer stated that he right away called up one of his bridge lenders that he works with and told them that he needs to close this and finish out this project, so let's close them together. Fischer stated that this is the only issue today is that he is trying to close both loans together. Fischer stated that if the Board says he is only authorized to close the Santander loan, then he will be short $5-$6 million; he is not here to lose the PILOT. Fischer stated that if he loses the PILOT, he will have to go back to Santander to resize the loan because of the taxes. Sawyer asked how much of the initial $32,000,000 is being taken out and not reinvested into the property. Fischer stated that all proceeds are being reinvested back into the property.
Chairman Reid stated that he would like to hear comments from staff on this and move this down the road. Bryant stated that Board staff has not received any additional refinancing paperwork, supplemental refinancing application documents, or any other information from this PILOT Lessee following the approval of the refinancing application on June 4, 2025. JP Townsend stated that as for the conditions of the property, as has been stated in prior reports, the completed and occupied areas of this property have been maintained. Townsend stated that the remaining portion of the property that is incomplete and unoccupied continues to have siding issues, office renovations that need to be done, and the occupancy of the property is still not in compliance. Bryant confirmed that the occupancy is 60%, which is below the Board’s 75% minimum occupancy requirement. Friary asked if that occupancy rate is considering both parcels. Bryant stated yes, because that is how the Board calculated occupancy according to its policies and procedures. Friary stated that she would like it to note that this occupancy rate includes an undeveloped parcel.
Carpenter stated that the Board has kept this project in legal default and going through these extensions of time, and the issue is whether to give additional time to cure or terminate the PILOT, which is one issue. Carpenter stated that giving an additional 30 days does not answer the question that the developer has proposed of giving this variance. Carpenter stated that what he has heard today is that if the variance is not granted, that the developer would be willing to close the Santander loan, but would not have enough funds to complete the full renovation, so the developer would need to come back at a later time to do that. Wellford stated that he heard that as well, but the Board would have to approve additional time through today to approve the Santander refinancing. Carpenter stated that it is only if the Board does not vote on the variance today. Carpenter stated that if the Board votes on the variance today, then the developer can go forward and close on Santander and Riverton. Bryant stated that she would like to clarify that her point was only considering the original PILOT Refinancing approval of the Santander loan is only valid through today, so that would be a separate vote. Bryant stated that the Board would need to have a separate vote to allow additional time to close the Santander loan only, as an extension of time of the original approval. Wellford asked if it would be procedurally proper for him to make a motion to provide additional time until the Board’s March 4, 2026 Board meeting to obtain the Santander Bank Refinancing in the amount of $27,400,000, which is what the Board has been hearing is in place today, to address part of the issues. Carpenter stated that it would be procedurally proper, but whether that would help them or not is unclear. Wellford stated he is trying to get this moving and get something tangible accomplished. Wellford stated that he is not getting the sense that there is a majority of support for the consideration of the variance, unless a Board member would like to make a motion to consider it. Fischer stated that he is just trying to understand if the Board just wants to terminate the PILOT and say sorry to Fischer, who has done that much in Memphis, and even though he is about to close, but it is not exactly how it worked and so be it. Wellford stated to Fischer that he is not helping himself, and if he would like to terminate the PILOT and is asking the Board to do that, then he will make the motion, but he is trying to give the developer somewhat of a lifeline. Friary stated that is not what Fischer intended. Eddings stated that is what it sounded like, and that is what is has sounded like all along. Eddings stated that he is pondering for the sake of affordable housing in Memphis and for all the work that the developer has done, what is a way out and what is the downside, what legal, and it sounds like this is something that the Board is allowed to do, but does it make sense based on the Board’s business practices and interactions, which were just underscored. Eddings stated that from a person who is concerned about people having access to a decent, safe, quality, affordable home, he leaned toward trying to figure out how to make this work, but at the same time, the Board has to govern itself in a way that represents all the people involved in this process, so when Fischer does what he just did, that is not very helpful. Fischer stated that he does not think he really wanted to say it that way, but he is sitting at the point where he has a current lender that if he does not pay up, he will have big problems.
Sawyer stated that he wants to talk about the citation that Friary cited to the Board as policy. Friary stated no, it is in the PILOT Agreement dated January 1, 2023 under Section 8. Assignment of Property; Foreclosure of Property. . . no assignment or transfer of the Lessee's interest in the Project shall be made unless: (i) the Lessor consents in writing to such assignment or transfer which such consent shall not be unreasonably conditioned, withheld or delayed... Friary stated that the section goes on with additional points, but this is how this is legally done. Corbin Carpenter stated that this portion of the legal documents refers to a situation if the PILOT Lessee submits a PILOT Transfer application; the Board should not unreasonably withhold its approval. Wellford asked for confirmation that Corbin Carpenter is stating what Friary is citing is applicable to a PILOT Transfer, to which Corbin Carpenter confirmed, but Wellford stated that is not what the developer is asking for. Friary stated that is not what is being requested. Corbin Carpenter stated that the developer is asking for an assignment. Carpenter stated that the underwriting period in any such situation is not two weeks and would require a minimum of 30 days. Carpenter stated that as Board’s legal counsel, he has indicated that legally his Firm can get this done, and asked the Board not to use that in its analysis of what is legal or not, but to analyze this from a business standpoint, from the Board’s policies and procedures, and from the last few years of credibility in dealing with this developer and his team, and if the Board decides to move forward, his Firm will make it work. Sawyer stated that he is unsure if he wants to go forward with it, but his knee jerk reaction is what is the big deal about a sublease, and if we are at the finish line and this thing is done, and if there is no big deal in fact, then what are we discussing here?
McKnight stated the before Board members vote on this, he would like to remind the Board that it has been given a legal opinion by the Board’s legal counsel, and he would like to reiterate that Board legal counsel does not support this whatsoever. McKnight stated that the Board has the variance to do whatever the Board deems appropriate, but the Board has received legal advice from its legal team. Wellford stated no, no, no; the Board’s legal counsel has not given legal advice to reject this, to which Carpenter confirmed no; he has not given legal advice to reject this. Henderson stated that the legal counsel just did not recommend it. Hagler stated that it is not recommended, but legal counsel can make it work. Eddings stated that they are hearing two different things and that he also is not hearing that legal counsel is giving legal advice to reject this. Corbin Carpenter stated that what he and Charles Carpenter are both saying is that their Firm does not support this because it is a matter of first impression and there is not a Board policy in place to deal with a situation like this. Wellford stated that is based on legal counsel’s knowledge, but this is a Board decision, and as the Board’s legal counsel, the Carpenters are turning the situation over to the Board and giving the Board the cautionary things to consider, but from a legal standpoint, Carpenter has stated that he can make this work. Carpenter stated that is correct. Wellford stated that if the Board were to determine to move forward, and legal counsel to make it happen, then the PILOT Lessee should certainly have to pay for that, even setting aside the estimated $53,000 that Bryant has discussed with the Board that this developer has already built up, and the PILOT Lessee should be responsible for that. Fischer stated that he will definitely pay for it, and in the past, he has had to put a rush on the Carpenters, and he has always paid his bills.
Henderson asked Carpenter and Corbin Carpenter when their Firm became aware of this variance request. Corbin Carpenter responded that they became aware of this variance request two (2) weeks ago. Henderson asked if Carpenters were aware of all the information that has been provided to the Board included in the February 3, 2026 dated letter to the Board. Corbin Carpenter stated that he received initial correspondence from Frank Stockdale Carney of Evans Petree two weeks ago, he then reached out to David Porteous and Elizabeth Friary a couple of days ago and the discussion was more elaborate, and at that point, he advised Friary to make this request to the Board and present this information to the Board at the meeting. Henderson asked if there were any changes from the correspondence two weeks ago up to today, to which Corbin Carpenter answered no. Sawyer stated that the only thing that could possibly be voted on today would be to extend the approval of the Santander Refinancing Loan of $27,400,000. Friary stated that the PILOT Lessee is ready to close. Wellford stated that the Board needs to push that date out so that there can be some kind of a refinancing, which is why he asked if it the Board could procedurally go ahead and get the $27,400,000 and get the Santander piece done today, and then maybe deal with the rest of this later, but in order to do that, the first step is to move to extend the timeframe for the original PILOT Refinancing approval.
Buckner Wellford made a motion to extend the timeframe until the Board’s March 4, 2026 Board meeting for the PILOT Lessee to obtain the refinancing in the amount of $27,400,000, or whatever greater amount Santander Bank is willing to loan, from Santander Bank. Howard Eddings, Jr. Seconded. There was no vote on this motion and continued discussion ensued.
Fischer asked if there is a possibility that if the attorneys can get the second loan done at the same time because that would be the same day because whatever will happen with Santander will go on both lots, and then the second lot will have to be pulled out. Fischer stated that he is signing the deed of trust. Friary stated that what the Board is saying with the motion that is being considered is that Fischer would need to come back before the Board with a separate PILOT Refinancing Application for the second loan for the second parcel. Fischer asked if when he signs the deed of trust, if it must include both parcels, even though Santander is not loaning on the second parcel. Carpenter stated that everyone is trying to follow what Fischer is saying, so for clarity Carpenter asked if there is a separate survey for lot 1 and lot 2, so which Fischer confirmed. Friary stated that right now the deed of trust references lot 1. Fischer stated that the PILOT references both lots, and if he does not do simultaneously both closings and do what he wants to do mechanically, then how will that work if he closes with Santander, and then comes back to the Board in 30 days, then he will have to go back to Santander to tell them he must amend the PILOT. Carpenter stated that his Firm can structure around that and would go back to the Board’s policies and procedures and see how that would need to be modified, if any, but there are a lot of collateral things to be done. Carpenter stated that if the Board approves any closing extension, his Firm could structure the deed of trust where lot 1 would be the only collateral. Fischer asked if he can close both of them if Carpenter is able to work out a structure. Carpenter stated that it would require Board approval. Wellford stated that he has put a motion on the floor that must be considered and any additional restructuring that is being discussed is where he would say there is going to be associated with the imposition of legal fees that the Board is incurring as a Board to do the restructuring, and that can be done later. Carpenter stated that he just wanted to ensure that what the Board is saying would actually help him, because what he thought Fischer stated was that today is the last day that he has to close the Santander loan. Fischer stated he has sent everything out. Carpenter asked for confirmation that everything has been snet to the bank, all documents have been signed and asked if today is the last day to finalize that. Fischer stated that the bank is waiting on him, and if the finalizing is a day off, and if Friary and Fischer’s transactional attorney in Miami, Michael Berstein, has said that if this gets done today, although he knows there are technicalities on the Board’s side just to get everything over. Carpenter asked what specifically he was waiting for today. Friary stated they are waiting for the Board’s approval. Carpenter asked what specific approval is Fischer waiting on. Friary stated that they are waiting for approval of the variance that is being requested, but she understands there is a motion on the floor. Bryant stated that the motion on the floor deals with the Santander refinancing loan only and does not include anything regarding the variance. Wellford confirmed and stated that the motion on the floor is for the Santander loan only, but that does not mean he is rejecting the variance at this time; it is just not part of the motion that was made. Sawyer asked just for clarification that both parcels would be included. Wellford stated yes because that is what the PILOT provides. Carpenter confirmed yes, because this is one PILOT. Corbin Carpenter further confirmed yes, stating that this is one PILOT with two separate parcels. Fischer stated that this will be a problem with Santander because they are not loaning on the second parcel. Sawyer asked why Santander would not want to accept additional collateral. Fischer stated because Santander is lending on an occupied property versus an unoccupied property and there are regulations and the property if only 60% occupied, which is why it is in legal default, but if the Board were to look at this project as two separate parcels, then this project would not be in legal default and the occupancy would be where it needs to be.
Bryant advised the Board that at the time of the original PILOT Refinancing Application, Santander only performed underwriting to refinance the occupied units and did not include the unoccupied units. Carpenter stated that is an interesting point because that would say that this $27,400,000 would be used on the occupied parcel that is secured by that loan. Fischer stated that the $27,400,000 are the proceeds that are given, and the bank is not looking at the sources and uses because it is an occupied property being refinanced from a bridge loan to a permanent loan for five years. Carpenter asked as far as the uses for the $27,400,000, if Fischer is saying he cannot use those proceeds for the unoccupied units. Fischer stated that when he presented the original Santander loan amount of $32,500,000, he knew there would be proceeds left over, so instead of taking a new bridge lender for another 12%-13%, he is getting 5.5% money instead of taking out another bridge loan, and he was going to take that money and use it for the second parcel. Fischer stated that now that Santander is providing less proceeds, he must bring in another bridge lender and it is going to cost that much more money. Henderson asked if Fischer has permission from Santander to do this and take a portion of the $27,400,000 and apply it to the second parcel. Fischer stated that is not the point, and this is money that is coming to him, so it is his sources for this and he has invested over $30,000,000 into the property and Santander is looking at the 432 units and how much he has invested in that parcel. Carpenter asked what the proposed uses are for the $27,400,000, and could he take those proceeds and finish construction of the remaining 200+ units. Fischer stated that he would not be able to complete all of the remaining units because that total is $5,100,000 less than what the original PILOT Refinancing Application outlined, so that is why he has brought in a new lender that is pretty much the same, but they are requiring a higher interest reserve and lending $7,500,000. Fischer stated that the $5,100,000 difference and bringing in this new lender that is going to require $1,000,000 in reserves will pretty much eat up the excess.
Sawyer asked what would be helpful for the PILOT Lessee today in thinking aloud could be that the motion be modified to exempt certain portions, specifically the second parcel, out of the lease. Wellford stated he does not know how that could be done. Corbin Carpenter stated that the original PILOT would have to be terminated, and that would convolute the transition even further. Wellford agreed that the PILOT would have to be terminated to do that because the parcels are connected by the PILOT. Cliff Henderson stated that it would split this PILOT into two. Friary stated that the request is not to change the PILOT.
Wellford stated that he has put a motion on the floor that must be considered and any additional restructuring that is being discussed is where he would say there is going to be associated with the imposition of legal fees that the Board is incurring as a Board to do the restructuring, and that can be done later.
Buckner Wellford made a motion to extend the timeframe until the Board’s March 4, 2026 Board meeting for the PILOT Lessee to obtain the refinancing in the amount of $27,400,000, or whatever greater amount Santander Bank is willing to loan, from Santander Bank. Howard Eddings, Jr. seconded, and the motion passed by majority after proper roll call vote of the Board members.
Let the record reflect that Daniel Reid voted NO.
Corbin Carpenter asked the Board if it is giving legal counsel authorization to work with the PILOT Lessee’s legal counsel to recommend a more compatible legal structure that can work with both parties. There was a consensus. Cliff Henderson stated that this is the crux of the situation because he does not feel like legal counsel had sufficient time, given the complexities that were presented, and it needs to be sorted out. Henderson stated that he believes the Board wants to give this a chance, while also recognizing the optics that this does not feel good, and this is something that is really testing the Board’s patience yet again. Because of the lack of time and the curveball that was thrown, Henderson stated in order for him to make a decision, that he would like for legal counsel to have time to sort this out and present what would need to be done in order to make this work within the Board’s current policies, or if there needs to be a variance presented versus the way it is being presented right now. Chairman Reid stated that this is also very expensive and will incur additional legal fees above the already incurred fees of approximately $53,000 incurred by the Board on behalf of this PILOT Lessee. Wellford stated that at least there is refinancing approval for a piece of this up to a certain point in time, and they can bring something back for the Board to consider.
b. Coronado Manor
Stephanie Bryant reported to the Board that the original PILOT approval for Coronado Manor was approved December 1, 2021 and the PILOT applied to the property December 13, 2022. Bryant reminded the Board that this project completed a refinancing that was approved on June 7, 2023 for $26,400,000. Bryant advised the Board that occupancy is a 77.8%, and reported that staff’s concern with this project is that construction is not complete and there are some issues remaining with that laundry room, which continues to be non-operational due to no laundry equipment being installed. Bryant stated that the PILOT Lessee has advised that they anticipate working with a different vendor for the laundry equipment than the one they have been working with. Bryant asked JP Townsend to report on the external observable conditions of the property.
Townsend stated that, similar to Bridgeport Manor, occupied units and areas have been maintained, but external issues remain including broken windows and staircases. Townsend reported that additional concerns include that some of the buildings are not finished internally with areas of units that need to be completed including flooring, walls, ceiling, and some bathroom fixtures that all need to be finished.
Bryant stated that at the Board’s November 5, 2025 Board meeting, Buckner Wellford made a motion to assess a $1,000 Compliance Deficiency Fee on this property that was to be supplemented following the research of legal fees and external monitor fees that the Board has incurred as part of the Board’s additional oversight for this project, to address any additional fee imposed, which is what prompted this review of expenses incurred by the Board across this developer’s entire PILOT portfolio. Carpenter asked, based on the cure plan that was submitted, what is the status of that. Bryant responded that the project is still not complete, and the board was told by the PILOT Lessee at prior Board meetings that all internal construction items were complete except for finished, but as Townsend has indicated and inspected the property, and internal construction is not completed and the laundry room has not been completed because there is no equipment, and therefore not operational.
Fischer stated that he has changed laundry equipment vendors, even though they have a longer lease. Fischer stated that he took an attorney’s opinion letter by sending the former vendor notice, even though the notice is not fully in effect, and took a company called CLE that is known in Memphis to be a little more reputable, he signed with them a couple of weeks ago, and are hopeful that the company will deliver the machines as promised. Carpenter asked what the PILOT Lessee’s request for this project is today. Fischer stated that he would like this project to be out of default because we are talking about a laundry machine, and he has hit the occupancy, and now there is a back and forth and the only reason that this went in to default is because of the portfolio of properties that he has, and slowly with every meeting that he has attended, other properties have been stepped down, and he would also like this property to be out of legal default and go into Under Observation status, and he does believe that the laundry equipment will be there by the March 4, 2026 Board meeting and he would like to take this off the agenda.
Carpenter asked Bryant is she has a staff recommendation. Bryant stated that staff cannot recommend movement because the commitments that have been made to the Board have not been fulfilled, so staff’s recommendation is for this property to remain in legal default. Carpenter stated that based on staff’s recommendation, and that fact that Bridgeport Manor has been moved to the next Board meeting, he would recommend moving this matter to the March 4, 2026 Board meeting, and if that time the property is in compliance, the Board can consider what action would be taken at that time. There being no further questions or comments, it was determined that the PILOT Lessee would appear at the Board’s March 4, 2026 Board meeting to provide a status update to the Board.
Buckner Wellford stated that the laundry facility issue at this property is just a prime example of the PILOT Lessee poking a stick in the Board’s eye. Wellford stated that for months the Board has been talking about this and the laundry facility is a pretty basic amenity for people who live at this property and the excuses that the Board has been given are unacceptable, so he hopes that something van be figured out in the next 30 days.
c. Sterling Townhomes
Bryant stated that Sterling Townhomes' representatives were advised to be here today. Bryant reported that she had received notice that the owner, David Blatt, would be unable to attend due to a family matter, but had anticipated David Shores’ and Alex Shores’ attendance, but they are not. Bryant continued, stating that Sterling Townhomes entered into the PILOT program in May 2025, and following that, the property sustained two (2) fires in 2025, but those fires did not damage any new renovations, as the fires took place prior to renovations beginning. Bryant stated that some demolition was scheduled and that did take place for a building located in the middle of the property, by there is still a substantial amount of cleanup necessary, including repairs necessary on some of the surrounding buildings that were impacted by the fires.
JP Townsend confirmed that the center main buildings where the fires occurred have been demoed, and debris has been removed, but there are still at least four buildings that have fire damage that work has not begun. Corbin Carpenter asked if the demolition expenses were paid by the insurance company or is the insurance issue still ongoing. Bryant stated that the PILOT Lessee is still going through legal proceedings with the insurance company, with the last update provided being that the PILOT Lessee had filed an Errors and Omissions Claim, but the Board staff has not received any update on where that process is today. Bryant reminded the Board that owner David Blatt had reported in December that he is researching some additional funding options to ensure this project moves forward with renovations and us put into service, and the owner does now plan to wait on the legal proceedings to conclude before pursuing some funding option(s) and completing this project.
Carpenter stated that based on this information that the Board has, there has been some effort to clean up the property. Carpenter stated that the point that was just discussed a to whether the developer has any additional equity or resources to move forward with this PILOT. Carpenter stated that if that is not the case, then Carpenter recommends that the Board would terminate the PILOT because this is not an issue with the insurance company as to whether there would be an amount of damages that the insurance company is going to pay, because the insurance company has said this was not covered under the policy, so that is the fight of the owner, and he must overcome that first, and then deal with the damages to the property. Carpenter stated that he recommends deferring action today until the Board's March 4, 2026 Board meeting, when representatives are present and can provide a proper update to the Board, and any action of the Board would be determined at that time. Chairman Reid asked that staff impress upon representatives the importance of their attendance.
Bryant stated for the record that she has had correspondence with Jennifer Lowrie of Baker Donelson Law Firm regarding her involvement with the PILOT for Sterling Townhomes and Lowrie has stated that she was only involved in the closing of the transaction and has had no further dealings with this project. Bryant has made Buckner Wellford aware of this as well, so it is at his discretion whether to recuse himself from discussions or votes concerning this project moving forward. Wellford stated that he will not recuse himself any further regarding this PILOT and is comfortable with deferring action. There being no further questions or comments, it was determined that the PILOT Lessee would appear at the Board’s March 4, 2026 Board meeting to provide a status update to the Board.
d. Sunrise Villas
Carpenter stated to the Board that less than an hour before today’s meeting, his Firm and Board staff received notice from the lender’s legal counsel indicating that the lender is requesting a Voluntary Termination of this PILOT. Carpenter reminded the Board that this is a property that was foreclosed on and the PILOT Term is due to expire on December 30, 2026 anyway, and HUD is now involved and is taking the necessary steps to re-establish the property, so his Firm will begin the procedure of the Voluntary Termination process. There were no further questions or comments.
Executive Director Report
a. McKnight stated that on February 23-24, 2026, there will be a Tennessee Affordable Housing Coalition meeting in Nashville, TN and he will be attending. McKnight stated that February 24, 2026 will be the “Day on the Hill” when Vincent Sawyer and Howard Eddings, Jr. will join him in meeting with this lobbying group, Tennessee Affordable Housing Coalition. McKnight stated he has already sent out talking points to and hopes that those have been received and reviewed as to what will be discussed. McKnight stated that if any other members of the Board would like to see that, he is happy to share it with other members of the Board.
McKnight reported that he and Dexter Washington of MHA recently presented to Memphis City Council and that it went very well. McKnight reported that the presentation went so well that Memphis City Council members requested a tour of some of the Board’s properties, so in the coming months he will be setting up a tour with Washington and Memphis City Council members to tour some of the Board’s PILOT properties to show them how the Board does. McKnight stated that all PILOT granting entities were called to the carpet, but he believes he and Washington’s presentation was the best, and he thought they did a really good job in presenting to the City of Memphis City Council and the Council was very appreciative of what the Board does for the community. McKnight stated that Council was not aware of the larger impact that the Board has, and McKnight believes that he was able to impress that upon them.
b. McKnight reported that the Northside Square Ribbon Cutting went well and showed the Board a commemorative trophy awarded to the Board to show the development group’s appreciation to the Board for what it has done for that community. McKnight stated that Mayor Young and Archie Willis did a good job of discussing how much the Board has done to make sure this project moved forward. McKnight stated that it was a really good ribbon cutting and mixer that took place the night prior and Howard Eddings, Jr. and Monice Hagler were in attendance.
c. McKnight reported that Mayor Young’s monthly meeting, which includes representation from this Board, EDGE, Downtown Memphis Commission (DMC), and all other Executive Directors meeting with John Zeanah and Mayor Young have gone very well. McKnight stated that there is allegedly a developer coming to town under the project code name of Artemus, a developer out of Baltimore looking at doing scattered sites in Memphis. McKnight stated that he, Dexter Washington of MHA, and Ashley Cash of Housing and Community Development (HCD) are being called together for a secret meeting to discuss what is being talked about for more affordable multifamily housing locally in conjunction with MHA and HCD.
McKnight reported that Stella Maris developer looking to develop 500 units in the medical district received news yesterday that the 7th largest affordable housing provider in the nation has approached them and they want to make every unit in the facility, all 500 units, 100% affordable with more details to come. Trey McKnight stated that the proposed addresses for the project in the medical district are: 57 N. Somerville with 329 units and 750 Adams with 128 units.. McKnight stated that the developer is not at liberty to share who that is as of yet, but he is still working with them to make those 500 units in the medical district become affordable housing. Vincent Sawyer asked where in the medical district is this project located. McKnight stated he would have to get the address for Sawyer. Sawyer asked what is the name of the property that is being converted for this project. McKnight stated he would get that information for Sawyer as well. McKnight stated that he has the information in other notes, but that this is a mission-driven organization with over 50,000 units across the country, and they are partnering with Stella Maris with 500 units in the medical district.
d. McKnight reported that he continues to work with Cliff Henderson on the Request for Qualifications (RFQ) for the Board’s website, was released to seven candidates. McKnight stated that one (1) response has been received and he would consider it a very good response, which has been shared with members of a working group along with his opinion regarding the response received. McKnight stated that he hopes to move forward if Henderson and others of the working group deem appropriate and there will be a virtual interview with Dylan Johnston of Revize, who submitted the response, will have the opportunity to answer any questions that the Board may have.
e. McKnight reported that he, JP Townsend and Nikki Abraham performed a walkthrough inspection of Memphis Towers, and all elevators were in working order.
Cliff Henderson stated that he would like to put some timelines on the website and come to a decision by the Board's March 4, 2026 Board meeting. McKnight stated that he understood. Henderson stated that assuming that the working group is favorable in making a decision, he would like to target getting the website revamped and up no later than end of July 2026. McKnight stated that this target date is within Revize’s timeline of 20-25 weeks to have the new site up and running. Corbin Carpenter asked for confirmation that there is only one proposal being considered. McKnight confirmed that, stating that the RFQ was released to seven (7) different groups, some local and some national, and he received one response back from Revize, and he perceived it to be a good one as the company has done a lot of work with other entities and city organizations like Dallas, TX, Nashville, and things of that nature, and are very good and reputable recommendations. Eddings asked for confirmation that the response included a timeline of 20-25 weeks, to which McKnight confirmed yes.
There were no further questions or comments.
Operations Report
Stephanie Bryant presented the Operations Report as follows:
a. Review of Compliance Oversight for November 2025
Bryant began by reminding the Board of the four (4) levels of additional compliance oversight that were put into place by staff in 2024 and this report will review movement of certain properties within these four (4) levels: (i) Under Observation, (ii) Compliance Concerns, (iii) Non-Compliance, (iv) Legal Default. Bryant reported as follows:
December 2025 + January 2026 Compliance Review for February 4, 2026 Board Meeting
1. Under Observation:
a. No PILOT properties were placed in Under Observation status during December 2025 + January 2026
b. The following PILOT properties are currently in Under Observation status:
1. Cedar Run: PROGRESS-89% Occupancy Rate; Some minor exterior items (soccer pad) remain outstanding, but consistent progress has been observed. Staff will review Q4 2025 Occupancy Report Submission and consider step-down to regular monitoring in February 2026.
2. Grainge Hill: STATUS QUO- 93% Occupancy Rate; Some minor exterior items remain outstanding, and no permanent solution has been identified or completed to address erosion issues at drainage ditch. Recent Inspection also included observations of a possible roof leak
3. Luxe at Raleigh: STATUS QUO-94% Occupancy Rate; Property has submitted a timeline for remedies and staff will continue to review and observe conditions monthly; Some power washing of roofs has begun.
4. Macon Manor: PROGRESS- 82% Occupancy Rate; Property conditions are in compliance. This property has now been moved to regular monitoring effective January 27, 2026.
5. Emberly Apartments (formerly New Horizon): PROGESS- Property is under construction; 60% Occupancy Rate; Property is Under Observation as a condition of the PILOT approval in April 2025; Property will remain Under Observation until construction is completed; Property consistently shows great progress with construction/renovations, and consistent increases in occupancy.
6. River City Townhomes: PROGRESS-77% Occupancy; Property has shown progress in external observable conditions and will continue to remain Under Observation until Occupancy rate has increased to 80% or higher.
2. Compliance Concerns:
a. One (1) property was placed in Compliance Concerns status from Under Observation status during January 2025:
1. Timber Pines: STATUS QUO-78.9% Occupancy Rate; Some minor exterior items remain outstanding; all unit interior construction is still not completed; STOP WORK Order remains on Laundry Room; no laundry equipment has been installed
b. The following PILOT properties are currently in Compliance Concerns status:
1. Mill Creek: SLOW PROGRESS- 80% Occupancy Rate; Progress continues on siding repairs, although slow. Staff will continue to review and observe conditions monthly.
2. University Place II & III: PROGRESS- University Place II-84% Occupancy Rate, University Place III-85% Occupancy Rate; Cure plan was submitted timely on October 6, 2025 and staff will continue to review and observe conditions. PILOT Lessee has submitted a new application for consideration at the February 4, 2026 Board meeting.
3. Villages at Harrisson Creek: STATUS QUO- 73% Occupancy Rate; Staff will review Q4 2025 Occupancy Report Submission and consider step-up movement in February 2026.
3. Notice of Non-Compliance:
a. One (1) PILOT property was placed in Non-Compliance status during November 2025:
1. Residences at Lakeview: DECLINE- 70% Occupancy Rate; Walkthrough was performed on October 29, 2025, with Cure Plan submissions due no later than November 4, 2025. No Cure plan was submitted. Property issues a Notice of Non-Compliance on January 29, 2026.
4. Legal Default:
a. Five (5) PILOT properties were issued a Notice of Legal Default during January 2026:
1. Feels Like Home Senior Living Residences: DECLINE- No Quarterly Occupancy Reports have been submitted for 2025, Occupancy Rate is unknown; Lack of progress with property rebuild following December 29, 2022 Fire to property; Walkthrough performed on September 17, 2025 and no cure plan was submitted by October 5, 2025; Notice of Non-Compliance was issued on November 12, 2025. Notice of Legal Default issued January 22, 2026.
2. All four (4) PILOT properties in Shemano’s portfolio have been issued a Notice of Legal Default during January 2026: declining property conditions and no progress shown following ongoing progress reports of concerns shared with ownership and current management. Staff received a cure plan on August 27, 2025 and following the initial sixty (60) days for the PILOT Lessee to progress through Phase one of the cure, there has been no progress observed and property conditions continue to decline; All Notices of Non-Compliance were issued on November 12, 2025 for the following properties; Notice of another change in management received on January 15, 2026 to Aurox Equities, effective January 1, 2026:
I. Abington Apartments: DECLINE-57% Occupancy Rate; Legal Default issued January 22, 2026
II. Country View Apartments: DECLINE-69% Occupancy Rate; Legal Default issued January 16, 2026
III. Jamesbridge Apartments: DECLINE- 52% Occupancy Rate; Legal Default issued January 16, 2026
IV. Lakes at Epping Way: DECLINE-55% Occupancy Rate Legal Default issued January 22, 2026
b. The Following PILOT properties are currently in “Legal Default” status:
1. Bridgeport Manor: STATUS QUO-Notice of Legal Default issued 04.17.2025; 60% Occupancy Rate; Property is due to appear before the Board at the February 4, 2025 Board meeting, which has been voted as the final deadline for the pending PILOT Refinancing to close; if PILOT Refinancing has not closed, Board will have the option to terminate the PILOT; Property remains incomplete.
2. Coronado Manor: STATUS QUO-Notice of Legal Default issued 04.21.2025; 77.8% Occupancy Rate; Property is due to appear before the Board at the February 4, 2025 Board meeting and has been assessed an interim $1,000 PILOT Compliance Deficiency Fee, with a supplemental PILOT Compliance Deficiency Fee to be considered at the February 4, 2025 Board meeting; Property remains incomplete.
3. Sterling Townhomes: SLOW PROGRESS- Notice of Legal Default issued 10.23.2025; PILOT Term: February 28, 2025- February 27, 2045; Property sustained two (2) fires in May 2025 and June 2025, causing substantial damage to the property, Insurance claim has been denied, and ownership is working on an E&O claim, but there is no resolution up to this point. No written response to the Notice of Legal Default has been submitted by the PILOT Lessee as of November 24, 2025. Written response received 12.09.2025 and 01.06.2026; last inspection: observation of demolition of building in middle of property completed and fire hydrant leaking on property.
4. Sunrise Villas: Notice of Legal Default issued 05.14.2025; Occupancy Rate Unknown; PILOT was foreclosed on by lender (Fannie Mae) June 27, 2025; Fannie Mae is in the process of determining how to proceed.
b. HEHFB Suite 1120 Preliminary Floor Plan Update
Bryant stated that she has been working with Henry Turley Company representatives on the remodel of the Board’s principal office, and work is progressing well. Bryant reported that all drywall framing has been finished, paint is due to begin today, ceilings will be installed this week, and the estimated completion date is February 27, 2026. Local weather has delayed the project approximately one (1) week, but Bryant stated Board staff is excited and things are looking great. Chairman Reid thanked Bryant for her hard work on this project.
There were no other questions or comments.
Board Office Nominations Review & Vote
Vincent Sawyer moved for acceptance of the Board Office Nominations as proposed with no changes, properly seconded by Monice Hagler and the motion passed unanimously after a proper roll call vote of the Board members.
Finance Committee Report
Cliff Henderson presented the financial results for the month ended November 30, 2025. After discussion,
Howard Eddings, Jr. moved for acceptance of the Finance Committee Report for the month ended November 30, 2025, properly seconded by Courtnee Melton-Fant, and the motion passed unanimously after a proper roll call vote of the Board members.
Cliff Henderson presented the financial results for the month ended December 31, 2025. After discussion,
Vincent Sawyer moved for acceptance of the Finance Committee Report for the month ended December 31, 2025, properly seconded by Howard Eddings, Jr., and the motion passed unanimously after a proper roll call vote of the Board members.
Strategic Planning Committee Update
Cliff Henderson began by stating that at the Board’s December 3, 2025 Board meeting and advised that the Strategic Planning Committee intended to come before the Board at today’s meeting to provide an update. Henderson stated that during the period of September 2025 to this point, there has been a Strategic Planning Committee that has been formed and that Committee met yesterday and is going to present some recommendations from that Committee to the Board, allow Mike Humes to provide some updates, but he would like to go through some of the Committee recommendations as follows:
Executive Summary
• Strategy Recap
• Summary of Proposed Recommendations
• Smart Memphis Fiber Deployment Status
• Potential Strategic Partners
• Framing Upcoming Board Offsite Meeting
Request of Board
Board Approval to Proceed:
1) Future Offsite Board Meeting
2) Extension of Consultant for a six (6) month period
Henderson stated that the Committee realizes that there is a tremendous volume of opportunities for the board to consider in the following slides, and we are not advocating to do everything.
The subcommittee recommends a future offsite meeting with the full board to prioritize options and plan next steps.
Three Strategic Horizons for HEHFB
Henderson stated that the Committee will maintain these three strategic horizons for the Board and looking at a lot of things that the Board is already doing around safety and compliance of Board policies, the extension here goes into Horizons II and III, which is Network and Partnerships to help the residents within PILOT communities to elevate and hopefully there are some things that the Board can facilitate to improve lives within the PILOT properties. Henderson stated that if the Board chooses to move forward, many of these activities can happen simultaneously, so that is something the Board can discuss when thinking about its priorities as we go forward.
2026 Draft Strategic Plan Action Priority Recommendations
Henderson stated that this information is some high-level draft recommendations that are going to be centered around safety, so that will be a key element of some discussions. The next thing is how the Board operates internally, both from a staff and a Board perspective, and looking at how the Board gets access to additional data and basically synthesize that data to present and be able to look at the entire portfolio more effectively. Next is looking at a digital equity and literacy plan for residents, which is where everything really started here with the Board in thinking about the Smart Fiber Initiative, which then flows into financial literacy, health, education, and community partnerships. Henderson stated that this all stems from the strategic partners and a lot of the due diligence that Humes did in canvassing different nonprofits. Henderson stated that this frames up and puts some scope into perspective of what the Committee wants to talk about in an off-site Board meeting that is being proposed.
Smart Memphis Fiber Overview
Henderson reminded the Board of the presentation made at the August 6, 2025 Board meeting by Doug McGowan, Staley Cates, and Jason Mulligan, stating that Doug McGowen came in because he initiated and is still very close to Smart Memphis Fiber in his role as Memphis Light Gas and Water (MLGW) President. Henderson stated that this initiative began in 2022 and there are many organizations that are working in conjunction to make this happen, and this is just a reminder of those organizations: the City of Memphis being the sponsor and investing approximately $25 million, MLGW as the infrastructure, Meridiam being the French-driven S Corp that was created to do this and is investing approximately $850 million for this initiative, mStreet serving as a subsidiary of Meridiam that is helping drive the project on the ground, Ting as the Internet Service Provider (ISP), Congruex and Protech are building out the physical elements to get service to the street, and then Post Road Foundation is looking at digital inclusion support. Henderson turned the meeting over to Mike Humes to provide an update.
Humes stated that the important thing is to realize that this is a private investment happening in Memphis of $850 million. Humes stated that Chattanooga deployed something similar in 2013, but the utility company invested that type of scale of money. In this case, Humes stated that this is a private investment and the Cit of Memphis is contributing approximately $22.5 million, and at the end of this 25-year term, this network is owned by the City of Memphis, so it is a great deal for the City and the residents to bring high-speed fiber. Humes stated that although this initiative came together in 2022, the build timelines have not accelerated as fast as most had hoped, and that is going to change. Humes stated that what he has been able to establish with mStreet is that every single PILOT property has now been identified as a priority deployment for this fiber network, and that was not the case 8 months ago. Humes stated that there were mandates to get lower income properties, but now they realize the scale that the Board can deliver approximately 25,000 units made up of approximately 125 PILOT properties. Humes stated that it is much more efficient to be dealing with the Board and to bring fiber to that many properties.
mStreet Fiber 2026 Deployment
Humes referenced the information above, stating that by the end of 2028, over 100 PILOT properties will have what is called “ready for service” fiber that is ready to go from the street to home. Humes reported that there are three steps in this process: (i) Right of entry, where mStreet works with the developer to say yes when they are ready to come in, (ii) Notice to Proceed, which means the fiber is going to be deployed to the street, and (iii) Ready for Service, which is the final step and fiber is at the street and is ready to go to the home. Humes stated that now, there are five (5) PILOT properties that are “ready for service”, which include Alco Management properties and The Works properties. Humes stated that the good news is that mStreet has realized that the Board and all its PILOT properties are #1 priority for them because they must hit these numbers within their contract.
Humes advised the Board that Jason Mulligan had initially been running the Post Road Foundation, the entity that is focused on digital equity, digital literacy, and devise acquisition, but just this week, Mulligan will roll into an official role with the City of Memphis as the owner’s representative overseeing the mStreet fiber deployment. Until this time, Humes stated that Doug McGowan originally led this, but there has not been an owner’s rep at the City of Memphis, and this is the City of Memphis’ contract issued to mStreet, so Mulligan will step in and 100% of his time is focused on making sure that what is being said in mStreet’s timelines are being delivered and that the right infrastructure is built in the right places a the right time. Monice Hagler asked if Mulligan was included in the group that came before the Board previously, to which Humes confirmed yes, that he presented to the Board with Staley Cates, and at that time he was with Post Road Foundation, so he is transitioning and reporting directly to Mayor Young on this project and it is now back elevated in importance, which is a good thing for everyone.
Potential Strategic Partners
Humes stated that he has secured support of approximately sixty (60) partners and six different categories. Humes reviewed the information included above and provided discerning factors for each category. Humes specified that accelerators are those organizations that are out deploying and building out networks but stating that each organization included in the various categories is 100% committed to the strategy and mission and what needs to be accomplished with PILOT property residents in mind. Humes stated that with a Power BI dashboard that has been discussed previously, the Board will have more intelligence around developer success and ideally it leads to not having to deal with as many compliance issues, as they would be identified well in advance and come on the radar earlier. Humes stated that he is working with Memphis Police Department (MPD) data, the Real Time Crime Center, along with eight or nine different data sources that will come into a Power BI dashboard and the Board’s website.
Project Approach Review & High-Level Next Steps
Henderson stated that the information above is a breakdown of what the Strategic Planning Committee has done and is proposing to do in three broad steps. In September, the Committee advised the Board that it needed several months to perform due diligence and raise things up to the surface to help the Board see the potential. Now that has been done and the Committee feels it is at the point to take the Board to an off-site Board meeting to frame up and look at the potential options and prioritize efforts going forward. If the Board approves the Committee to move forward at that time, the Board will be able to go into prioritization and then also look at any initial foundational investments and where the Board wants to focus its efforts. Henderson stated that the Board cannot do everything with all 60 partners, but what it can do is focus on what is important for the Board. Henderson stated that Chief Davis of MPD is very amenable to provide resources in thinking about data linking things and Humes has gone to the Memphis Fire Department, MLGW, and the Committee now has the ability to go do some things and bring this information in, and then start thinking about some of the educational, health and financial resources, but this is where we need to determine what the Board wants to focus on and then facilitate that. Henderson stated that in thinking about the website McKnight mentioned earlier, the Board can set things up and do things to help residents see what is available because there are a lot of different elements that are out there. Henderson discussed Humes finding a company, ER2, that is refurbishing devices, and the company is headquartered in Memphis with a distribution center in Phoenix, AZ, and it is a nonprofit that may be a source of devices to facilitate that for some residents. Henderson mentioned other examples of organizations willing to partner with the Board, but the Committee needs to put this information before the Board to determine how it moves forward. Henderson stated that the Committee has gotten the Board in a good position that gets back to some internal things like the website, but the Board needs to determine where it wants to be, what is important to the residents, and then be able to push that out.
Trey McKnight stated that in reiterating a point, the website RFQ that was sent out, and the only response received was from Revize because they are the only company that knew how to work with Power BI, which is one of the reasons he is looking forward to working with them, as the other six vendors were not familiar with Power BI and did not have any work experience with Power BI with respect to a website.
Humes stated that the sixty partners that have said they are on board with this strategic plan does not mean that they are asking for financial support from the Board, because this is work that each of them is already doing and is not taking the Board’s resources to cover any admin costs or overhead. The idea is to integrate the PILOT properties and its residents into their network to make sure the properties and residents are a priority, just as was done with mStreet. Humes reiterated that there is no financial commitment to cover.
Framing Board Offsite Meeting
Henderson stated that as soon as the board moves forward with an off-site Board meeting and the Committee maked recommendations on how to proceed, likely to happen in the Summer 2026, moving forward and what to do to implement and focus on those priorities to carry those forward and understanding the capital needs and resource needs that come with those priorities. Henderson reviewed the information above, stating that the Board put a tremendous amount of work into tenant benefits a few years ago, which was a good step forward. With the digital equity piece, Henerson recalled Wellford’s comments to Alco Management today regarding the property-paid fiber internet service for its residents, and in considering that, the Board needs to determine whether this strategic plan changes tenant benefits and what the Board may require in the future. Henderson describes several options that he expects the Board may discuss in the off-site Board meeting and looking at the impact of any changes made to current PILOT Lessees moving forward. Henderson stated that given the duration of Board meetings, not much of the PILOT portfolio is able to be discussed, so he wants to see how to make this information available to the Board and plug in the data through partnerships to help move this forward and make Board staff more effective and determine how the Board wants to position itself as a partner or connector for other things moving forward.
Chairman Reid stated that there have been so many rocks that have been turned over and so much finding in the work Humes has done, and he has done a yeoman's job with this. Reid stated that there is a lot of information to digest here, and the Board is going to have to take its time to look strategically at how it moves forward with this very purposefully. Vincent Sawyer stated that he also commends Humes’ efforts over the past few months and looks forward to an off-site Board meeting to discuss this as a whole, and he continues to support this Board initiative and overall strategic plan.
Corbin Carpenter asked in hearing all the City of Memphis entities that have related to the health, educational, and safety pieces, if there has been any interest shown by Shelby County, the Shelby County Sheriff’s Office, or the School Board. Humes stated that he has not met with the Sherriff’s office, but with the Shelby County Schools, yes, but this initiative is focused on the City of Memphis because that is where the foundational fiber network if being deployed and where the Board’s focus is. Humes stated that there are some segments of Shelby County that will be involved, but it just has not been a priority because Shelby County is focused on a much broader piece of geography. Humes stated that the Committee is not asking the Board to assume responsibility of creating all of this, and all this is already happening, and it is just a matter of inserting the Board’s focus, initiative, and mission into those entities that are already doing great work. Henderson describes some examples, such as proof of concept of devices, and use of MPD data that will drive conversations of how the Board can move forward and create requirements around safety and other things in the future. Monice Hagler stated that it seems like the Board would need to prioritize how it identifies properties as it moves forward from phase to phase. Henderson agreed and stated that this idea goes with the data. Henderson discussed potential sponsorship opportunities as part of this as well, but the potential is there of what the Board can do, and that is what the Committee will frame up for the Board for this off-site Board meeting. Henderson stated that he will coordinate with staff to distribute some optional dates for the off-site Board meeting. Henderson stated that the final item is extending Mike Humes as a consultant for the Board for an additional 6-motnh period.
Monice Hagler made a motion to approve the extension of Consultant Services provided by Mike Humes for the Strategic Planning Committee and the Board for an additional 6-month period. Vincent Sawyer seconded, and the motion passed unanimously after proper roll call vote of the Board members
There were no further questions or comments.
New Business
There was no new business.
Chairman Reid stated that the next regular meeting of the Board is scheduled for Wednesday, March 4, 2026 @ Noon. There being no further business, the meeting was adjourned by the Chairman at 3:09 p.m.