MINUTES OF REGULAR MEETING OF
THE HEALTH, EDUCATIONAL AND HOUSING FACILITY BOARD
OF THE CITY OF MEMPHIS, TENNESSEE
Wednesday, March 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, February 25, 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, and Nikki Abraham; Charles E. Carpenter and Corbin I. Carpenter (Zoom), General Counsel; Katrina Shephard (Zoom) and Sariah Bell (Zoom), legal assistants to General Counsel; Chris Kelley, Assistant City Attorney; and Mike Humes, consultant to the HEHFB Strategic Planning Committee.
Also participating in person and/or via remote Zoom virtual platform were Jennifer Lowrie of Baker Donelson Law Firm and LC Wallace of Elmington Property Management, LLC representing Chelsea Flats; Thomas Hewgley of Bradsher Alpert Stuart Law Firm and Philip Wazonek representing Looney Apartments; Isaac Perlmutter of Aurox Equities, Inc, Pinchos David Shemano and David Upton representing Abington Apartments, Country View Apartments, Jamesbridge Apartments, and Lakes at Epping Way; Diana Bates, Ronald Huggins, Deborah Heirs, Carolyn King, and Vanecia Belser Kimbrow representing Feels Like Home Senior Living Residences; David Shores of Multi-South Management Services representing Sterling Townhomes; Micheal Bernstein of Bernstein Law Firm, Frank Carney of Evans Petree Law Firm, Mendel Fischer, Shrage Marasow (Zoom), and Neil Knopf representing Bridgeport Manor; Frank Carney of Evans Petree Law Firm, Mendel Fischer, Shrage Marasow (Zoom), and Neil Knopf representing Coronado Manor, Eden Pointe, Grainge Hill, and Scenic Hills; Charles Settle of the Shelby County Assessor's Office; Mary Linda Cuddy of Memphis Interfaith Coalition for Action & Hope (MICAH); Simeon Ike (Zoom) of Greater Memphis Housing Justice Project; Todd Harris of Metropolis Real Estate; William Flannigan; 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, March 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.
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 stated that he would like to make a motion to accept the Minutes of the February 4, 2026 Regular Meeting with the edits accepted, but with all redactions to be unredacted and included in full detail. Henderson stated that up to this point, meeting minutes have included full details, and he would propose that the Board continue to include full details. Charles Carpenter stated that for the benefit of the Board, meeting minutes speak to the actions of the Board through the motions, the seconds, and the resolutions that are passed. Carpenter stated that he has included some of the commentary and discussion to the minutes for the benefit of context, but discussion is typically not a part of meeting minutes. Carpenter stated that Board Meetings are recorded, but meeting minutes deal with the resolutions of the Board, not the discussion or comments. Carpenter stated that comments that Board members make that are not reduced to a motion and a resolution are part of the recorded record, but they are not minutes but rather notes of the discussion of the Board, and that is the way that it is typically done. Carpenter stated that resolutions are the actual voice of the Board and the resolve of the issues but do not include everything that was said and is not a transcript of the meeting. Carpenter stated that the Board has the option of maintaining the record any way it wants, but as far as the minutes are concerned, that would be his recommendation.
Buckner Wellford stated that Carpenter is likely accurate in his description of meeting minutes, as most meeting minutes are not as long as the Board’s meeting minutes, but he finds it very helpful given the number of matters that the Board deals with each month. Wellford stated that Stephanie Bryant does a good job of capturing in detail what was discussed and he finds it very helpful in reminding himself what was discussed in preparing for the upcoming meeting and he is very comfortable with the way it is being done, and the Board has gotten very fulsome minutes, at least since Bryant has been preparing the minutes. Wellford stated that it is not as though the Board is moving from a terse action item manner of keeping minutes into a more narrative form, as the minutes have been in a narrative form, and he agrees with Henderson that the Board needs to capture most everything that goes on. Wellford stated that he is comfortable with Chairman Reid exercising some discretion on some things that are unnecessary to include, and Chairman Reid could be more involved in reviewing the meeting minutes drafts moving forward.
Carpenter stated that in order to give firm context, Bryant prepares a transcript of everything that is said, and then his Firm works with Bryant to reduce all of the materials to more of a meeting minutes fashion, and the drafts have been long, which is why things have been operating as they have all along. Carpenter stated that this is not a change from that, but a lot of the issues that the Board is dealing with now involve so much discussion, and it is not evidence of the will of the Board, only individual Board members discussing matters back and forth. Having said that, Carpenter stated that something other than a full transcript and just the resolutions need to be addressed, so it is up to the Board how it wants to deal with that. There being no further questions of comments,
Cliff Henderson moved to accept the Minutes of the February 4, 2026 Regular Meeting with the edits accepted, but with all redactions or removal of discussion to be unredacted and included in full detail, which was seconded by Buckner Wellford 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 receipt of one (1) new litigation matter for the month of February 2026 regarding Jamesbridge Apartments. Carpenter stated that a Receivership Petition has been filed with Chancellor Melanie Taylor Jefferson in Part 1 of Chancery Court in Shelby County, TN. Carpenter reported that this PILOT property is also in Legal Default and is listed on the Board’s action items today, so he will reserve any additional comments for discussion at that time. Carpenter reported that there have also been materialmen claims filed against various PILOT properties and those will be handled in the normal course of business.
2. Carpenter reported receipt of Notice of a Non-Judicial Foreclosure for Cedar Run Apartments that is scheduled to be auctioned on the courthouse steps on Tuesday, March 10, 2026, at 12:00 noon CT.
3. Carpenter reported Bond activities for February 2026, stating that Tennessee Housing Development Agency (THDA) has opened the 2026 Round One in its THOMAS System for application submissions for 4% low-income housing tax credits (LIHTC) and volume cap, and March 19, 2026, is the end of the application period for Round One. As part of that, Carpenter reminded the Board of several projects that the Board has induced and Legal Counsel and Board staff have completed the TEFRA Hearings for each project, including:
a. University Place Family
b. University Place Senior
c. 300 Court Avenue
d. Saints Court Apartments
e. Melrose Housing
Carpenter stated that his Firm is in the process of submitting the necessary information to the legal department for the City of Memphis for approval by the Mayor, and once that is completed, those items will be submitted to THDA as part of the application. Carpenter advised that the Board does have one additional Bond application it will consider during today’s action items, of which the applicant also plans to submit a completed application to THDA for Round One, so he will reserve any additional comments for that agenda item.
Carpenter reported that due to the federal government shutdown in 2025, there were two (2) properties that were approved for Bonds and PILOTs:
a. Covenant Gardens Senior Bond 2025 THDA allocation was approved for an IRS tax credit allocation carryforward to 2026. The working group has convened and is working toward closing. This is a new construction project.
b. Surrey Apartments Bond 2025 THDA allocation was approved for an IRS tax credit allocation carry forward to 2026. Closing is anticipated for later in the month of March 2026. This is an acquisition-rehab project.
4. Carpenter reported that the Housing and Urban Development (HUD) has recently liberalized some of their guidelines dealing with affordable housing to stimulate more housing. Carpenter reported that throughout the country, there has been a lot of stress and inefficiency in affordable housing, and as a result, HUD has started to add some different guidelines to help facilitate the industry. Carpenter stated that he has reported in prior Board meetings about the 50% test being reduced to 25%, which means that a minimum of 25% of the tax credits and bonds can be used to have a successful project versus 50% and the thought is that this change would stimulate more activity and will allow the LIHTCs to be spread into a larger area. Carpenter reported that this has changed a lot of the loan-to-value ratios, which would also help with development and how tax abatement savings can be used to add to the value. Carpenter reported that there are a few other things dealing with refinancings and hold back and other things that would help to stimulate more activity in the affordable housing arena. With increases from tarrifs and increased labor costs and so forth in many jurisdictions, Carpenter stated that the code requirements for affordable housing and conventional housing are the same, so it is more costly to develop affordable housing now, and that is something his Firm is monitoring and will continue to monitor going forward.
5. Finally, Carpenter reminded the Board of the 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.
Carpenter reported that each of these PILOT properties are included on the Board’s action items agenda for today’s meeting, and he would reserve any additional comments for that time.
There being no further questions or comments, the Legal Report was concluded.
Action Items-
1. Bond Inducement Resolution for ECG Chelsea, LP (d/b/a Chelsea Flats)
Charles Carpenter introduced this first action item stating that this is a new construction project through Elmington Capital, who has been a participant in the board’s PILOT and Bond program for several other successful projects. Carpenter stated that the developer anticipates filing a PILOT Application for this project in the coming months. Carpenter reported that he has worked with Board staff in reviewing this application; a submittal conference was successfully held, and the application complies with the Board’s policies and procedures. Carpenter invited representatives present for this agenda item to make any further comment. Jennifer Lowrie introduced herself as legal counsel to the applicant, and LC Wallace introduced herself as the representative for the Elmington Capital development team. Wallace thanked the Board for the opportunity to work together again on this project and described the project as a 158-unit new construction development that is planned to be 100% affordable. Wallace stated that the unit mix is made up of 2-bedroom and 3-bedroom units. Carpenter asked for confirmation that the applicant would be applying for 4% low-income housing tax credits through THDA, to which Wallace confirmed. Carpenter stated that though it does not show on this agenda but asked for confirmation that it is the developer's intent to file a PILOT application in the future, to which Wallace also confirmed. Wallace Stated that the intent is to file the PILOT application once application is made to THDA.
Carpenter reminded the Board that this is an inducement of the bonds, and once the applicant puts their final structure together with their capital stack of sources and uses, the applicant will come back before the Board for a final bond resolution. Carpenter stated that typically the applicant would do a public offering, and that would be part of the structure that they would come back and share with the Board. Carpenter stated that based on the history that the Board has had with this developer, they have had significant success in the community, and his Firm is supportive of the application. There being no further questions or comments,
Monice Hagler made a motion to approve the Bond Inducement Resolution for ECG Chelsea, LP (d/b/a Chelsea Flats). Cliff Henderson seconded, and the motion passed unanimously after proper roll call vote of the Board members.
Let the record reflect that Buckner Wellford is recused.
2. Appeal to Board Staff and Legal Counsel Decision for submission of Affordable Multifamily Housing PILOT Application for Looney Apartments, LP
Carpenter introduced this agenda item, stating that under the Board's PILOT policies and procedures, the Board is the final adjudicator of PILOT activities. Carpenter stated that this application was submitted and reviewed preliminarily by staff and by his Firm and based on the face of the application and subsequent discussion with the applicant and its legal counsel, a determination was made that this did not comply with the minimum requirements of the policies and procedures of the Board. Carpenter stated that after communicating this information to the developer and its legal counsel, the parties asked to address the Board on that denial. Carpenter invited representatives in attendance for this agenda item to introduce themselves and present its appeal to the Board.
Thomas Hewgley of Bradsher Alpert Stuart Law Firm introduced himself and his client, Philip Wazonek. Hewgley stated that he and his client had a meeting with Board staff and legal counsel, and they are here today to discuss that meeting, of which there were three issues: (i) the “but for” test, (ii) Tenant Benefits, and (iii) qualifications. Hewgley stated that he and his client were notified toward the beginning of that meeting that the application was denied, so he was unsure whether he and his client would be able to present their case to the Board, as they have the right to do. Hewgley stated that during that meeting, it was mentioned that his client had the money for the projects, therefore it was not precluded from necessity. Hewgley stated that this is not necessarily the case and just because an applicant has the money does not mean that the applicant does not need the PILOT. Hewgley stated that obviously the PILOT is there to help costs go down, and that the applicant could certainly move forward with the project, but would be forced to charge higher rents, which defeats the purpose of what his client is trying to do. Hewgley stated that there seemed to be confusion about that, so he wanted to clarify that point.
Hewgley stated that the second part is tenant benefits, of which Hewgley stated Carpenter advised during the application review meeting that the tenant benefits listed in application are not quality tenant benefits. Hewgley stated he was not given a chance to go through any of them by his account, and he will not go through them all here, but he has them listed if the Board would like to hear them. Hewgley stated that the project has seven (7) qualifying tenant benefits, and he finds it interesting because he did a little survey of the surrounding properties and some other properties throughout the County [Shelby] and noticed that those properties had about the same benefits. Hewgley stated that he and his client are seeking to understand why this aplication does not qualify and to get a little better understanding. Hewgley stated he is happy to answer any questions on this appeal.
Monice Hagler asked how many units this project is made up of, to which Hewgley stated five (5) total units, which he understands used to be below the Board’s threshold, but he and his client were notified that there is no longer a minimum number of units to qualify. Buckner Wellford asked what the basis was for the denial and mentioned that it is noted that there was no application fee billed or paid. Hewgley stated that he asked about paying the application fee and was told to wait. Carpenter stated that the application fee was not charged because based on the application, it was a very poor application, and the project is made up of five (5) total units, and the tenant benefits as outlined were required to bring the property up to code. Carpenter stated that this has been a distressed property that has been vacant for a number of years. Carpenter stated that the applicant purchased the property and started renovating the property, assuming... Hewgley interrupted Carpenter, stating that he would not allow Carpenter to state that his client assumed anything. Wellford stated that the Board would like to allow its legal counsel to finish his statements. Hewgley stated he just wanted to make sure. Carpenter stated that this is not a court of law, and the point of the matter is that as this Board knows, the basis of the PILOT program is tenant benefits. Carpenter stated that some of the tenant benefits listed include flooring, HVAC systems, new roofs, etc., and each of these items would be required by Code Enforcement. Carpenter stated that he attempted to explain to the applicant and its legal counsel that complying with code and the Board’s tenant benefits are two separate things, not one in the same. Carpenter stated that the applicant also omitted in the applicant the fact that the property is currently in Environmental Court. Carpenter stated that the Board also has previous involvement with this developer with another property that was terminated from the Board’s PILOT program, following working with the developer over an extended period of time, and the property was never able to reach any of the minimum standards for the Board’s PILOT program. Carpenter stated that based on the totality of circumstances and to protect the Board’s PILOT program, Board staff and legal counsel concluded that this project did not qualify for the program. Carpenter stated that the applicant has rejected that analysis, and that is why this is on the agenda today, but his Firm and Board staff stand by their initial conclusion. Carpenter stated that he does not believe that anything that has been presented by the applicant, or its legal counsel today alters that conclusion in any way, and that would be his response. Trey McKnight concurred with Carpenter’s assessment, stating that Board staff also does not support this application.
Vincent Sawyer stated that he would like to see more in the tenant benefit breakdown going forward, but this application is not like any applications he has reviewed before regarding the tenant benefits. Chairman Reid stated that this is because the tenant benefits stated do not meet the minimum standards of what the Board has set forth. Chairman Reid asked if there were any further questions from the Board. There being no further questions, Chairman Reid asked for a motion.
There was no motion made by any Board member; therefore, this action item failed due to lack of motion from the Board.
Thomas Hewgley asked if he was going to get a chance to speak, as he thought he was going to get an opportunity to present, as was indicated by Carpenter in the application review meeting, and he thought he was going to be able to address some of these points specifically. Carpenter stated that the Board thought he had presented. Hewgley stated that he said he could go through the delineation point, and he said he was opening it up for questions from the Board. Hewgley stated that if there is no real procedure, then Carpenter needs to explain that. Carpenter stated that there were no further questions from the Board. Wellford stated that the Board did not tell him he could not respond to Carpenter’s statements, and he does not mind giving people a chance to speak. Hewgley stated that Carpenter previously advised that this is not a court of law, so there are no Tennessee rules of procedure, so Carpenter needs to be clear on what the procedure is. Hewgley stated that he could have gone through each tenant benefit, but it would have taken a whole lot more time to go through the whole application and tried to make this more of a back-and-forth. Hewgley stated that this is the second time that Carpenter has summarily denied his client the right to speak, and he totally objects. Hewgley stated that there are seven (7) items listed on page 24 of the PILOT application that are listed on the applicant’s applications and are part of the Board’s policies and procedures that Carpenter is stating are not there. Sawyer stated that he would like to give Hewgley the opportunity to speak. Carpenter stated that as a point of order, should the Board set aside the lack of motion denying the appeal and open the matter back up for discussion, as that is what needs to happen procedurally to allow further discussion. Sawyer stated that since there was no motion, the action item failed, but there has been no denial, and opened the item back up for discussion. Carpenter confirmed and asked the applicant to proceed.
Hewgley again stated that on page 24 of the PILOT application, there is a list of all accepted examples of tenant benefits and listed specific items included as examples, stating that the following were included as examples and included in this application: (i) upgrading HVAC, (ii) new appliances, (iii) exterior lighting and fencing, (iv) dog park, (v) internet, (vi) new flooring or carpet. Hewgley asked how none of these are not qualified tenant benefits, as it says they are on page 24 of the application. Carpenter stated that what Hewgley has indicated is that the application references the upgrading of those items, and as this was a vacant building and the developer is adding these items under the Code requirements, which is a separate issue. Hewgley stated that it is the same thing to say upgrading and including it just because it is not there. Hewgley asked if Carpenter is saying the developer should focus on projects that do not need as much work, which makes no sense. Hewgley stated that he gets it and does not want to waste too much time of the Board, as it has other business. Hewgley stated that, as was previously indicated by Carpenter, his client did have a failed project that included circumstances he would love to present, but he is not going to do that as it would not do any good. Hewgley stated that his client had a partner in that failed project, there is ongoing litigation involved, and his client was removed from that project. Hewgley stated that he understands, and if the Board wanted to deny this application based on that, then that should have happened from the beginning, but he did not get a chance, but he appreciates the Board listening, and his client did submit an application in which he and his client included everything they thought was necessary, and the application qualifies for the “but for” test, and just want to be heard.
Sawyer stated that it raises an interesting point that to make a property habitable, and to equate that to a tenant benefit seems to not comply with the intent of tenant benefits, but he is interested in hearing more of what the policy and procedure says around tenant benefits with regard to things that are required by law in a property. Wellford stated that there may be concern around what the application says, because he is sure the Board’s PILOT policies and procedures are clear that tenant benefits are not intended to address basic building and code issues. Wellford stated that if the application itself is ambiguous on the point, then the Board may need to review the application and make that a little clearer. Wellford stated that he would suggest to the applicant as a practical matter, that the Board likes to see tenant benefits that go beyond basic habitability-type things. Wellford stated that he sees the dog park included, but the Board likes to see things that are focused on the particular property, and that is how the Board interprets tenant benefits. Wellford stated that if the application is ambiguous, the Board should review that. Howard Eddings, Jr. stated there must be distinguishment between benefits and entitlements because everyone is entitled to basic standards and whatever is required by architectural designs and Code Enforcement, but the benefits, as the Board looks at tenant benefits are beyond that. Wellford stated that the Board’s policies make that clear, and if one were to read the definition of tenant benefits in the Board’s policies, which is clear, the question is whether the application is clear. Hewgley stated that to that point, it is a semantic ambiguity on page 24 of the application where most of the sections begin with the term “upgrade”, but the Board should consider new construction where there is no upgrade, but building new, so the developer is complying with Code at the same time it is providing the product. Hewgley stated that there is a place in the application that states that the most important tenant benefit is affordability and is that not what the Board is doing here? Hewgley stated that for his client to move forward, the market will dictate that he will have to charge a higher rent and will not be able to service the part of the market that needs to be served. Hewgley stated that he and his client tried their best and did not try to put in less effort into this but simply followed along with the application and filled in the information that they had. Hewgley stated that he apologized if he and his client have not completed the application correctly but would appreciate any kind of effort or any kind of consideration from the Board. Hewgley stated that his client apologized for the failed project in the past and acknowledges that and understands it is fair to bring that up.
Carpenter asked what the status of the Environmental Court proceedings for this project is. Hewgley stated that his partner is handling that and turned the meeting over to Wazonek for comment. Wazonek stated that his schedule for renovations exceeds the timelines for the Environmental Court requirements. Wazonek stated that if there are no delays in the permitting process, he will far exceed the timeline, as Judge Dandridge has given a timeline of nine (9) months, and he will have the project complete in approximately four (4) months, assuming permitting comes through, so he is ahead of that. Wazonek stated that one last point of the issue he would like to make for what he is doing for this project is that he is far exceeding the minimum requirements of what Code Enforcement is requiring him to achieve and this apartment building is in excess of that, and he thinks that is a tenant benefit. Wazonek stated that the fact that there is a derelict building that has been vacant for decades and is an eye sore and a criminal issue, and the fact that he is doing what he is doing to bring the property back up to speed and making it rent-ready to a section of the tenant base that requires that and is in high demand for the respective property, he believes is a huge tenant benefit. Sawyer asked what the nature of the case in the Environmental Court is. Wazonek stated that the previous owner had not paid the taxes, and he stated that he went before Judge Dandridge a few months ago and presented his development program and Judge Dandridge set the timeline, and although he was not required to present in person, he presented his development plan and how things are progressing, and the Environmental Court issues have nothing to do with him, but only by virtue of acquisition of the property. Hewgley stated that while this information may not have completely answered Sawyer’s question, he would find out more information from his partner and provide that information. Monice Hagler asked if, given the concerns of the Board and the Board staff, if the applicant would be willing to resubmit the application and add tenant benefits that would result in benefiting the tenants. Hewgley stated that this is where the confusion is, and that the tenant benefits are included in the application, as he has just read them out to the Board. Hagler stated that the Board has already discussed that many of the listed tenant benefits in the application are matters that are required by Code, so she is suggesting to the applicant that he may want to reconsider tenant benefits. Hewgley asked for examples, to which Hagler stated she would not provide examples, as the applicant has the document before him. Hewgley stated that his dilemma is that he is reading it word for word and does not understand how the tenant benefits listed in this application do not comply. Hagler stated she is asking the applicant’s legal counsel to read the room, and the room is suggesting that right now, what has been submitted are just Code Enforcement requirements, and the applicant may want to review its application and resubmit. Hewgley stated that a dog park is not a code enforcement requirement. Chairman Reid suggested that the applicant work with Board staff and legal counsel, as this appeal has been failed due to lack of a motion. Chairman Reid stated that this does not mean that the applicant cannot due its due diligence and properly submit an application that satisfies the Board’s staff and legal counsel to properly come before the Board. There were no further questions or comments.
There was no motion made by any Board member; therefore, this action item failed due to lack of motion from the Board.
3. Status Updates for PILOTs in Legal Default:
a. Abington Apartments
Carpenter introduced this agenda item, stating that there was a Notice of Legal Default issued for this PILOT property, and a formal written response has been filed by the developer. Carpenter stated that representatives are in attendance for this agenda item and turned the meeting over to them for introduction and further comment.
David Upton introduced himself as consultant to ownership. Upton stated that his client has four (4) PILOT projects in the Board’s PILOT program, all included in the list of legal default properties to be discussed at today’s meeting, including Abington Apartments, Country View Apartments, Jamesbridge Apartments, and Lakes at Epping Way. Upton introduced owner David Shemano, property owner, and Issac Perlmutter of Aurox Equities, Inc., who is the new capital investment partner, and on-site manager working with Shemano. Uptown stated that this team has information to share with the Board about all four (4) properties, with Abington being the first property. Upton stated that there is substantial work committed that is ongoing at Abington Apartments, and he thinks that if this group is able to come in with the other three in the next several months, he is hoping the Board will feel comfortable working with this group on a month-to-month basis, keeping the PILOT in place, until all properties can get into compliance. Upton stated that this group has had lengthy discussions, and he thinks that ownership and the new management company understand what is necessary. Upton stated that all four (4) properties have occupancy issues, which is the most important deliverable, and clearly cited deficiencies of capital improvements and related repairs that need to be done, and this group will be able to get those underway and get more leasable units and resolve those issues. Upton stated that the tenant benefits are very important, and his client understands that, and they will have a plan to meet those benchmarks. Upton stated that his client and Aurox Equities representatives have prepared and brought handout materials to provide to the Board. Upton stated that the group can address each property one at a time or go through all four (4) properties and then open it up for questions. Carpenter advised representatives to address each property one at a time.
Carpenter stated that the Board staff and legal counsel have been working with Shemano on this portfoloio for a period of time and over the past year, Board staff and legal counsel have had several different representatives that Shemano has brought in and the Board needs to have understanding of how things are going currently, and how things are going to proceed going forward so that we can help each other get these properties back in good standing. Carpenter stated that having various representatives contacting Board staff and legal counsel at different times is very unproductive and confusing for everyone. With that said, Carpenter stated that the Board needs a clear basis of the current designated representatives to proceed with. Upton stated that the Board staff and legal counsel have been provided with the resume of Aurox Equites, Perlmutter’s company, and he will allow Perlmutter to explain the arrangement between his company and Shemano. Upton stated that he understands that a new management company must be approved, and while Aurox Equities was put into place in January 2026, that was done with no disrespect to the Board, and the Board may want to entertain that now or look at the information for the management company and get comfortable with the information provided by Aurox Equities, whatever the Board believes is appropriate. Upton turned the meeting over to Shemano for comment.
Shemano stated that he has owned property in Memphis for over ten (10) years, and he is embarrassed to be here because until three (3) years ago, he believes there were no complaints with any of his properties. Shemano stated that he has made some bad judgement calls over the last three (3) years with management, which in hindsight he should not have made, but he did, and that is why he is here today. Shemano asked the Board to remember the good years of his properties’ participation in the PILOT program and remember that he had no complaints or issues prior to three (3) years ago. Shemano stated that he made some bad judgement calls and found the wrong people, but he finally found someone that is putting money where his mouth is, and Perlmutter is bringing in $8 million to do address these properties and to help Shemano. Shemano stated that Perlmutter will be providing an update for each property, begining with Abington Apartments, and stated that quite a few buildings have had roofs replaced in the last four (4) weeks, and Shemano is comfortable that Perlmutter is putting this capital into the properties, and he will be the final person the Board has to deal with, and he will be representing the properties in the PILOT program from this point forward. Shemano stated again that he is sorry he is here in these circumstances, but with this infusion of cash, he is going to get these properties back into compliance. Shemano stated that others that had been previously involved had convinced him that they were experienced, but at the end of the day, the buck stops with him, and he has now found someone who has successful properties around and has brought substantial funding to these properties.
Upton asked Perlmutter to speak on how this relationship will work between Aurox Equities and Shemano and then move forward to a report on each property's status and action plan. Isaac Perlmutter introduced himself, stating that his company, Aurox Equities, gets involved with properties that are in distress and turns them around. Perlmutter stated that his company keeps some properties long term, while others are sold. Perlmutter stated that he was introduced to Shemano sometime in September 2025, and toward December 2025, a deal was finalized, although not totally, but things are almost complete, as there are a lot of variables that need to be worked out. Perlmutter stated that he has committed $8 million to these properties to bring them to where they need to be, and his company officially began on January 1, 2026.
Perlmutter stated that at this point for Abington Apartments, thirteen (13) roof replacements have been done. Perlmutter stated that some photos and videos were sent to Board staff to show that progress. Perlmutter stated that he has contracted and completed all the plumbing on the property and has started working on the breezeways and exteriors of the buildings. Upton began providing the handout information to the Board members and staff. Upton stated that information specifically pertaining to Abington begins on page three of the handout, and advised that as representatives report on each property, the Board and staff would find that additional information by property in the handout materials. Upton turned the meeting back over to Perlmutter for the remainder of the status update for Abington Apartments. Perlmutter stated that a roof replacements deposit was made and the entire roofing project should be completed by March 15, 2026, and gutters are included in the roofing contract work. Perlmutter stated that he has contracted work for all the balconies, building-by-building, and breezeways, with pressure washing to be performed. Perlmutter stated that all the siding on the buildings will be fixed, all front doors will be repainted, all staircases and breezeways will be repaired, and replacing what needs to be replaced. Perlmutter stated that the pool has been given out to an outside company for maintenance and repairs. Perlmutter stated that plumbing across the property has been scoped for every single line and jetted where necessary, and replacement where necessary. Perlmutter stated that exterior gates have been activated and will go live March 9, 2026. Perlmutter stated the gate is an electronic gate, and his company is gathering the information necessary from the property. Perlmutter stated that the clubhouse will be completely redone, and his company will work with tenants to be sure that they do not have any outstanding issues. Perlmutter stated his company’s motto is safe, healthy living, and he hopes to take care of any outstanding maintenance items and have happy tenants that stay for a long time.
Carpenter asked if the $8 million investment is for the entire portfolio, or only for Abington. Perlmutter stated that the $8 million investment is for all four (4) PILOT properties, and there is also money in reserves for each property. Carpenter stated that based on the Board’s PILOT structure, these are single-asset entities and asked if there is a holding copany or some other structure that Perlmutter is planning to invest into these properties. Perlmutter stated that the current structure of the agreement is that the capital investment of $8 million is structured as a loan to the individuals, and Shemano’s loan is secured by shares, which is the legal structure. Perlmutter stated that currently he is not a part of ownership, but once this plan is executed and the work that is required is completed and the benefit is realized, his company will come in as partial owners, likely five to seven years in the future, when his company will own the majority interest in the properties. Upton stated that representatives understand that a change in ownership is subject to the approval of the Board. Upton advised his client that all mortgages and debt on the properties would also require approval by the Board.
Carpenter asked what the current occupancy rate is for Abington Apartments, to which Perlmutter responded that the occupancy rate is approximately 60% occupied. Chairman Reid asked Stephanie Bryant for an update on recent occupancy report submissions. Bryant stated that with the most recent submission of Quarter 4 2025 occupancy reports, Abington’s occupancy rate was reported at 54% occupancy. Perlmutter stated that his company is leasing and preparing units with a regular rotation of units and anticipates Abington will reach stabilization within six (6) months. Bryant asked for confirmation that although Shemano owns other properties in Memphis, the $8 million in investment discussed today only applies to these four (4) PILOT properties, to which Perlmutter confirmed.
JP Townsend stated that he can verify that roof replacements have begun at Abington. Townsend also noted that some areas of the drive have been striped. Townsend stated there is still a significant amount of work that needs to be done at this property and asked for clarification as to the completion date for all roof replacements on property. Perlmutter stated that 23 roofs are being replaced, and the work will be completed as of March 15, 2026, as the team is able to complete a roof replacement for one building in approximately three (3) days. Townsend stated that his other concern on this property is that there have been some active leaks in various places and asked representatives if those have been addressed or if they are in the pipeline to be addressed. Perlmutter stated that plumbing is the cheapest thing to do, and he has contracted Rushing Plumbing to evaluate each building to make sure sewage lines and water lines are in order. Townsend stated his last concern is with the security gate, and as has been previously mentioned, tenant benefits are a focus of the program, and this is one of the properties that some of the tenant benefits that were committed to at the origination of the PILOT are not in place. Townsend asked if all tenant benefits are now in place and if not, what the status if for those tenant benefits are not in place at this time. Perlmutter stated that the security gate repair has been completed and will be active on March 9, 2026, and his team has identified and responded to each item, with the only item left outstanding being 24-hour security. Perlmutter stated that his team is still assessing security and once the security gate goes live on March 9, 2026, he believes they will be able to collect data from the gate cards and assess crime at that time. Perlmutter stated that security is a very big expense, but if it is needed, the property will have it, as safety is his biggest concern, Townsend stated that he cannot state whether the additional security is needed, but the fact is that it is listed as a tenant benefit commitment for this PILOT property.
Perlmutter stated that in the written response to the Notice of Legal Default, his team has listed each tenant benefit that was committed to and responded to each item within that letter. Perlmutter stated that during the summer when the pool is open, there will be a pool attendant, as committed and stated that his company tries to do what is right. Perlmutter stated that his company begins with assessing the exterior of each property, starting at the top and working to the bottom. Perlmutter stated that he believes Abington will be a beautiful property. Townsend stated that this property is the one out of this portfolio that needed the most work, and it is good to see motion on this property, as it has not had much progress in any kind of rehab in quite some time. Perlmutter stated that when the work is completed, Townsend will not even recognize the property. Perlmutter reconfirmed that the date for the security gates to go live in Monday, March 9, 2026, and his team is actively accumulating the gate cards.
Bryant stated that Board staff’s recommendation is for this property to remain in Legal Default status and appear before the Board at its April 1, 2026 Board meeting with a status update. Bryant stated that this recommendation is because staff have seen work begin before, and quickly lose momentum, therefore staff would like to ensure this momentum exhibited continues. There being no further questions,
Vincent Sawyer made a motion to accept Board staff’s recommendation for Abington Apartments to remain in Legal Default status and appear before the Board at the April 1, 2026 Board meeting to provide a status update. Howard Eddings, Jr. seconded, and the motion passed unanimously after proper roll call vote of the Board members.
Chairman Reid stated for the record, when PILOT properties enter a Legal Default status, we are in the ninth hour, and this is not when the wheel begins turning. Chairman Reid stated that it looks like this PILOT Lessee and his team has already begun the work and thanked them for their efforts but stated if it were the case that things were just beginning at this point, the Board does not look favorably upon that. Perlmutter stated that his hope is that what is presented is delivered on by the next Board meeting to get out of Legal Default, because the Legal Default status triggers defaults with lenders and starts a lot of legal issues, and he feels that the quicker he can finish the work, the better.
b. Country View Apartments
Perlmutter stated that his team went through the same process with Country View, begining with necessary roof repairs. Perlmutter stated that there are no roof replacements necessary at Country View, only roof repairs, and those have been approved and should be completed the week of March 15. Perlmutter stated that security gate repairs have been completed and are functional and will also go live on March 9, 2026. Perlmutter stated that the breezeways have two issues involving the upper part and the lower part of the breezeways, with the upper area involving flooring, and he is working on a solution to that, short of redoing all the flooring and moving tenants. The lower part of the breezeways has been quoted, and Perlmutter stated he is in the process of getting that work under contract. Perlmutter stated that the work will be done by a local contractor, being the same contractor performing breezeway work at Abington will complete the work at Abington and move to Country View to perform the work necessary there. Perlmutter stated that the contractor moves quickly, and all work will move quickly for the same reason, which will allow him to make sure units can be prepared to be leased quickly. Perlmutter stated that the contract for the exterior work has been awarded, but as stated previously, Abington work will be completed first, then the contractor will move to complete the work for Country View second. Perlmutter stated that all exterior lighting has been worked on to ensure it works at night, and the pool repairs and maintenance have been contracted.
Perlmutter stated that his team has hired and will be meeting with an engineer tomorrow to discuss two sink holes at each end of the property and once he receives a recommendation, he is going to fix it, and this will be a big item. Perlmutter stated that all exterior perimeter fencing, aside from the security gates, has been contracted and deposited, and repairs should be completed within the next week. Full-time landscaping has been hired, in addition to an initial cleanup that already occurred, with fine-tuning to take place with the flowers and make sure it looks presentable. Perlmutter stated that the breezeways and the stairs is something that his team is working on at Country View specifically, as many of the staircases are not perfect. Perlmutter stated that all window repairs have been contracted out and all repairs to windows will be made individually, his team has ordered 100 new washers and dryers to complete replacement of all necessary appliances that are in place that require replacement, all plumbing has been jetted to ensure everything is working properly, and all tubs have been resurfaced so long as the tenant makes the request.
JP Townsend stated that, as he stated with Abington, he is seeing motion on property, and this is a property that he has inspected every month for an extended period, and he can confirm that landscaping has been addressed at this property. Townsend stated that there have been some spot treatments to certain areas, including the perimeter fence around the playground that was an issue, and remains the most outstanding concern that needs to be addressed at this time. Perlmutter stated that this portfolio includes four (4) properties, so once his team finds the right vendor, they will award all of the outstanding work to that vendor, and the vendor performs the work quickly and focuses on one property at a time to complete the work and move to the next property. Townsend stated that he is simply reporting to the Board from his observations of someone that has been on this property and inspected it for a long period of time, and that he has not observed the same level of progress yet, and he can only state the facts of his observations, which is there are still areas of roofing that need repair, during his last inspection the security gate was not functioning, and he has questions concerning whether new management has access to the security cameras onsite, as prior management had stated during a Tenant Benefit Review in March 2025 that they did not have access to view the security camera feed or footage. Perlmutter stated that he does not have the information for certain on the cameras, but he will get an update for the Board staff. Perlmetter stated that as for work that has been executed includes the initial cleanup of the landscaping, the jetting of all plumbing, and the repair of the security gate, which is now operational and will go live on March 9, 2026. As for the remaining work, Perlmutter stated that his team will be providing weekly updates, but he does not know who on the Board receives those updates. Bryant stated that all updates would be directed to her, and she distributes that information to the Board accordingly.
Bryant stated that there has been no Quarter 4 Occupancy Report submission for Country View. Perlmutter stated that this report will be submitted by the end of the week, as his team performed a change to a new system from an old system, and there were inconsistencies, and he wants to ensure he is providing real numbers. Bryant stated that she, along with the Board, appreciate real numbers, but she must state for the record that there has been no Quarter 4 Occupancy report submission, as well as there has been no formal written response to the Notice of Legal Default for Country View Apartments. Bryant stated this is the only property out of the portfolio that a formal written response to the Notice of Legal Default was not received. Bryant stated that the formal written response must be submitted to Board staff within five (5) days of this Board meeting. Bryant stated that there is also an outstanding balance of $14,040.56 due to the Shelby County Trustee. Perlmutter stated that he is new to this portfolio and is still trying to gather all the information. Bryant stated that while she understands that she wants to ensure that the PILOT Lessee and his representatives, as well as the Board, are all aware of these outstanding items, and the Board needs to know what the plan is to get these outstanding items addressed. Perlmutter stated that he will make sure that this balance is taken care of. Upton stated that he provided some escrow information at the end of the year 2025, and he believes that there are escrow funds to take care of that balance. Shemano stated that he has just brought in Perlmutter recently, so there are things about the Board and the PILOT that he will have to learn. Shemano stated that he was not at the PILOT Lessee Training Workshop that the Board had last year, so a certain amount of leeway should be had. Perlmutter stated that this will be taken care of. Shemano asked if Board staff could copy him on this information, to which Bryant advised he and the Board that Shemano is included on every email correspondence to the PILOT Lessee, as the owner of these projects to ensure that he is always aware.
Chairman Reid asked if there are any outstanding liens or claims against the property. Carpenter advised that there are and asked representatives if they have employed local counsel to handle those issues, as there are claims for work that were previously done that imply, they have not been paid. Perlmutter stated that this team does have local counsel, and these claims are being taken care of and are in negotiations at this time, but he will ensure they are taken care of. Carpenter stated that these are matters that are currently pending in General Sessions Court, and since Perlmutter is a separate entity, he will need separate legal counsel to handle that. Carpenter stated that if Perlmutter contacted the attorney and paid the claim, that would resolve it, but in the meantime, Carpenter’s Firm must be kept advised of what is going on because his Firm monitors these types of claims on behalf of the Board, but he will follow up with representatives on the outstanding issues. Carpenter asked what the timeframe is for Country View to be back in compliance and in good standing with the Board. Perlmutter stated that the work itself will be completed in the next three (3) months, and he has a timeline that lists each item that was shared with the Board of what his team intends to do, but as for the legal liens, that is something that must be settled, and he hopes to have those resolved by April 30, 2026.
Buckner Wellford stated that both of these properties that have been discussed, security was a tenant benefit and given the size of these properties and that there is no security, that is a major concern he has, and he does not think the only choices are 24-hour security versus nothing, but that would be a big deal to him in terms of pulling these properties out of legal default status and that Abington Apartments was granted a PILOT Term Extension based on enhanced security measures as a tenant benefit, and he would expect those to be in place. Upton stated that the tenant benefits that were committed to the property would have been done at the time of PILOT Term extension approval, and some of them say security, but he is unsure if the commitment enumerates 24-hour security or if it is general. Perlmutter stated that security is an issue for his team as much as it is for the property and if the properties needs security, they will have security at the level that is necessary. Perlmutter stated that when a property is not safe, it affects insurance, tenants, and everything around the property, so what his team is assessing is once the perimeter fencing is secured and the electronic gates are secured, if there is a need for additional security, it will be added. Perlmutter stated that if there is a commitment to have security, then they will have it. Wellford stated that he is simply asking to hold the PILOT Lessee to a promise made when the PILOT and/or the PILOT Term Extension was approved. Upton stated that Perlmutter’s team agreed to comply with whatever level was committed to at the onset of the PILOT or the PILOT Term Extension, of which Perlmutter confirmed, stating that he has reached out and gotten details on tenant benefits commitments.
Bryant stated that Board staff’s recommendation is for this property to remain in Legal Default status and appear before the Board at its April 1, 2026 Board meeting with a status update, the outstanding Quarter 4 2025 Occupancy Report and formal written response to the Notice of Legal Default to be submitted within five (5) days, and all outstanding PILOT payments to be paid prior to April 1, 2026. There being no further questions or comments,
Cliff Henderson made a motion to accept Board staff’s recommendation for Country View Apartments to remain in Legal Default status, outstanding Quarter 4 2025 Occupancy Report and formal written response to the Notice of Legal Default to be submitted within five (5) days, all outstanding PILOT payments to be paid prior to April 1, 2026, and appear before the Board at the April 1, 2026 Board meeting to provide a status update. Vincent Sawyer seconded, and the motion passed unanimously after proper roll call vote of the Board members.
c. Jamesbridge Apartments
Carpenter introduced this agenda item stating that, as mentioned in the legal report, his Firm has received a Notice of Receivership, which now takes this matter under the jurisdiction of the Chancery Court. Carpenter recommended that any additional comment be reserved, and action deferred until his Firm can obtain more information on the legal status of the receivership and how the Chancellor intends to proceed with it. Carpenter stated that based on that, he would recommend this item be deferred to the Board’s April 1, 2026 Board Meeting agenda and his Firm would be in a better position to report at that time. There being no further questions or comments,
There was a consensus of the Board to defer this action item to the April 1, 2026 Board meeting. No Board action is required at this time.
d. Lakes at Epping Way
Carpenter asked representatives to provide a status update. Perlmutter stated that this property has gone through the same process as Abington Apartments and Country View Apartments, as the security gate is now fixed and functional and will go live on March 9, 2026, roofs have been assessed and repairs will be completed by March 17, 2026. Perlmutter stated that the roofs are in good condition but require some repairs. Perlmutter stated that all gutters will be redone, breezeways will be repaired, and this project will go through the same process and steps as Abington Apartments and Country View Apartments, and his team has provided a timeline and will be providing weekly updates to the Board on what has been done in order to follow the progress. Upton stated that roof work for this property is scheduled to commence on April 15, 2026. Upton stated that in several compliance reports, roofing issues were identified, but obviously an assessment has been done of this properties’ roofs versus the other properties, and he is happy to share that information with the Board so that the Board can be comfortable with that, and this team is addressing it, and invited compliance inspectors to do a visual inspection as best they can, but stated that Perlmutter’s team has more information that can be shared with the Board and Board staff later. Upton reiterated that this roof work will commence on this property on April 15, 2026, and he can continue to talk about the scope to the Board’s satisfaction. Upton stated that stairwell and ceiling repairs will commence on March 9, 2026, and there will also be work performed on damaged balconies.
JP Townsend stated that he can only communicate his observations of the external observable conditions to the Board, and he has observed no changes to this property at this time. Townsend stated that he does agree that roof conditions are not near the same conditions as the other properties, but there is still a need for some roof repairs, gutter repairs, fascia repairs, siding repairs, and some playground equipment shows some signs of age, but it is functional. Townsend reported that some of the balcony ceilings are falling off and there is a fire-damaged building on the property from a recent fire. Townsend stated that it is appropriate to receive a timeline so that he can observe the progress according to the timeline provided, but at this time, there has been no change. Perlmutter stated that work has begun with Abington first, and the order of work will happen with what can be achieved most quickly. Townsend stated that during a Tenant Benefit Review conducted May 29, 2025, Board staff reviewed the interior of a model unit, and this model unit had mold in it and there was a mushroom growing inside of it, which is really concerning. Townsend stated that Board staff is not allowed to inspect interiors of occupied units, and only had jurisdiction to inspect a non-occupied unit upon approval from management during a scheduled site visit, so the only information that he is able to report is external observable conditions, but as a result of that Tenant Benefit Review, it can only be deduced that there are interior concerns at this property as well as the exterior concerns. Perlmutter stated that his team performs preventative maintenance every three (3) months, and Townsend is welcome to come to the property the next time Perlmutter is in town, and he will share that information with Townsend. Townsend stated that he inspects this portfolio of properties every month and has been for over a year. Perlmutter stated that the point is he is not trying to hide, and he is happy to share the information. Townsend thanked Perlmutter. Upton stated that Perlmutter would be willing to open more units for inspection, if the Board would like, even though the Board staff does not normally do that, Perlmutter is willing to do that. Perlmutter stated that the quicker he resolves these issues, the quicker he gets value for his money.
Townsend asked about the PILOT term expiration for this property. Chairman Reid stated that this PILOT term expires March 31, 2026. Bryant confirmed that there has been no PILOT Term Extension Application filed for this PILOT property. Upton stated that the property would need to apply for a new PILOT or would look to the Board for some direction on that. Carpenter stated that it would not be a new PILOT but would be a PILOT Term Extension. Carpenter stated that since this PILOT expires at the end of this month and there is some different activity going on, he would recommend to defer action on this agenda item to the April 1, 2026 Board meeting, and that will provide an opportunity to further review and if the PILOT Lessee has prepared a PILOT Term Extension application, they would file that during that time.
Vincent Sawyer stated that he is interested in hearing a brief comprehensive plan and asked overall how long the cure plan will take for all four (4) properties, as it is his understanding that this team is going to go one at a time. Perlmutter stated that this depends, because with the security gates and perimeter fencing, the work went across all four properties, and if it is a specific crew that works, he would like to continue with the same crew. Perlmutter stated it is up to the crew whether it expands, because on his side, he is ready. Perlmutter stated that his team’s goal is to have all outstanding items fully completed in six (6) months. Upton stated that the occupancy could take longer, but Perlmutter stated that the occupancy varies for each property, and projections for occupancy have been provided for each property. Upton stated that as things progress, this team is willing to come in and give more specific occupancy reports and timelines.
Bryant recommended the certified rent rolls be submitted for all four (4) properties to Board staff no later than the 5th of each month to track occupancy rate progress. Carpenter stated that ten (10) days prior to each monthly Board meeting, as the Board typically meets the first Wednesday of each month, is to provide an updated written timeline outlining what has been done during the prior period, forecasted occupancy, and what steps are being taken so that the Board will have that to review prior to each meeting, and then representatives would be available to answer any questions that the Board would have. Carpenter stated that the Board wants to work with the PILOT Lessee and if progress is being made, that is positive, with the problem being when there are long gaps with no positive action being completed, which is not helpful to anyone. Carpenter stated that as Perlmutter is new to this community, Carpenter advised that PILOTs are under strict scrutiny now and a lot of elected officials believe that community is not receiving the full benefit of the PILOT program and that there are developers that are taking advantage of the program. Carpenter explained that there are several different issuing entities, and each has its own metrics and are not as clear as the Board’s PILOT program, but unfortunately, the Board’s PILOT program tends to be lumped in with the overall PILOT discussion, which does not help anyone. Carpenter stated that with that, having this cure plan executed in a timely manner is necessary because affordable housing is needed in the community, but it must work properly and must be according to the Board’s PILOT policies and procedures. There being no further questions or comments,
There was a consensus of the Board to defer this action item to the April 1, 2026 Board meeting. No Board action is required at this time.
Howard Eddings left the meeting.
e. Feels Like Home Senior Living Residences
Carpenter introduced this agenda item, stating that this property entered the Board’s PILOT program January 1, 2020, as a new construction project, and the property sustained a major fire on December 29, 2022. Carpenter stated that a Notice of Legal Default was issued on January 22, 2026, and introduced the developer in attendance, Vanecia Belser Kimbrow, and turned the meeting over to Kimbrow for a status update.
Kimbrow stated that she is an attorney by trade but does real estate development work as a career. Kimbrow stated she would like to give background on how Feels Like Home Senior Living came about, and stated that some time ago, her mother was ill and Kimbrow had no success in finding suitable, affordable senior housing for her, and at the urging of a friend who lived at the neighboring Kirby Pines property, Kimbrow and a group of friends purchased this property to provide what they felt was missing, which was affordable senior housing where average working people could come and live and thrive. Kimbrow stated that this group built that property, 120-units, survived the Covid-19 pandemic without a single case, then post-pandemic, had a massive fire in December 2022. Kimbrow stated that the fire destroyed over 80,000 square feet of the 111,000 square foot facility. At that time, Kimbrow stated that due to safety concerns, the entire property was shut down.
Kimbrow stated that Feels Like Home is a mission-based property and is not a for profit entity; she takes no salary, and the only salaries that are paid to staff, and all other funding goes back for the benefit of the seniors that live there. Kimbrow stated this is not just a building; it is their home, and she makes it such through amenities, three square meals a day, outings, free washing, and the average rent is $1,200, which includes rent, meals, and utilities. Kimbrow stated that when the building was shut down, she did not abandon the seniors but moved them to a hotel for 30 days and then sourced temporary housing with Brown Baptist Facility for over a year. Kimbrow stated that she fought with the insurance company and the lender, but because 2/3 of the site was destroyed, the contractual documents required that if more than 50% of the property is damaged, the lender has the right to demand a payoff, and that is what the lender did, and the lender was paid in full, and there is no debt on the property. Kimbrow stated that she has rebuilt the site out of donations and personal contributions and making sure that any senior she could not relocate could continue to live there.
Kimbrow introduced three (3) residents in attendance and invited them to speak about their experience following her comments. Kimbrow stated that Diana Bates and Ronald Huggins have been at the property since prior to the fire damage, Deborah Heirs has just joined the property recently, but this speaks to the mission of the project. Kimbrow stated that while she may not be perfect at turning in all the paperwork on time, she promises to do better, and stated that staff is made up of only a few, but they get the job done and keep the focus on the seniors and their happiness and holistic living environment. Kimbrow stated that the property is beautiful and well maintained, and anytime she gets a notification of issues from staff, repairs are made timely, and she is raising capital to rebuild the project. Kimbrow stated that when damage like this occurs, the developer is locked out of the property for a year, and it took her a year and a half just to clean up the site. Kimbrow stated that it would have been easy to sell the property and walk away, but that was not the commitment she gave, and she has stood by this PILOT, even in the face of less than one-third of the property remaining. Kimbrow stated that she is still paying taxes on a full site of 120 units and 111,000 square feet that does not exist anymore.
Kimbrow stated that she and the development team have paid $2.8 million out-of-pocket and restored the major systems that were completely damaged, roofs, HVAC units, and all units that are currently occupied on the first floor have been completely redone with new flooring, paint, mold abatements, grounds restored, and amenities restored. Kimbrow stated that the elevator was lost, so they have no access to the upstairs at this time, so when the Board looks at the occupancy rate being where it is, she cannot put seniors on a project that does not have an elevator to get upstairs, so those units in essence are 25 down units. Kimbrow stated that she has retained the architects and design plans are well underway and projects to break ground on what is going to be an outdoor community space in the next month, Kimbrow stated that when she closes the downstairs area, the seniors will be relocated to the cottage units temporarily while a lift elevator is installed and 25 unit upstairs are restored, then seniors will move back in.
Kimbrow stated that the development team will also build back another 10,000 square feet of common area, as the formal dining hall and amenities were lost and other spaces have been repurposed to where seniors have a workout room, day room, dining facilities, and laundry facilities. Kimbrow stated that the new outdoor amenity will be underway so that when senior are moved to the cottages that have been renovated, they will still have a gathering space because what remains important to her team is community and the seniors are a community and they gather for their meals, church and worship services, and they need a space to do that, so Kimbrow stated has been diligent with the development group in developing in a thoughtful and meticulous manner. Kimbrow stated that it is not at the speed of a larger organization that has limitless resources, but the development team has maintained core values and principles of what this Board and PILOT was designed to do, which is affordable housing that is safe and habitable with happy tenants. Kimbrow stated that although things are a few months behind, they are not significantly delinquent on anything.
Kimbrow invited current Feels Like Homes residents in attendance to speak about what Feels Like Home has meant to them. Ronald Huggins introduced himself, stating that he has lived at Feels Like Home for almost nine (9) years, and only one person has lived there longer than him, but he really enjoys living there. Huggins stated he was there the night of the big fire and went through the whole year of being away from home, and now he is back home, and that is what they call it because it is home to them. Kimbrow introduced Diana Bates and stated that she has a speech impediment and asked the Board to have patience, and she and Huggins may have to interpret for her. Bates did not speak, and Carpenter stated that she is not required to speak, as her presence stands for itself. Kimbrow invited the last resident to speak. Deborah Heirs introduced herself, stating she goes by Gigi, and stated that she has been at Feels Like Home for a little over one (1) year, and it really is home. Heirs stated that she has met so many wonderful people, there is a diverse population, and seniors there can be as active as they want to be. Heirs stated that management puts on concerts in the hall, walking that is included as a group two days a week, bingo three days a week, but all the systems and things where there may be a concern in other areas, they do not worry about it and everything is just wonderful. With that, Kimbrow stated that she would now entertain questions.
JP Townsend stated that this is a property that, is well over a year behind the construction plan that was agreed upon, including the community areas and buildings that were demolished. Townsend stated that the buildings that are in place have been maintained, but one of his concerns if that the comments made today discuss development on a community area, but there is no functional elevator, which has not been functional since he and Nikki Abraham performed a walkthrough of the property in September 2025. Townsend stated that with the occupancy rate being so low, he would think the immediate concern would be to get the second floor functional before going into new construction. Kimbrow stated this is a give-and-take situation and that the property needs the community space in order to relocate the seniors to the cottages because she is unable to have construction take place on the second floor while the downstairs first floor occupied, so the development team will create and build the community space so that while construction of the addition happens, the residents can continue to live their normal day-to-day lives. Kimbrow stated that the elevator was destroyed during the fire and was not dysfunctional and functioned until the fire. Kimbrow stated that she did some back and forth with civil and structural engineering as to whether the elevator was going to be salvaged, and it was determined that it was not salvageable, so the development team had to go through a second phase, which encompassed all the common areas. Kimbrow stated that the property lost 65 units, but retained a lot of the common area, including the elevator, but it could not be restored due to the risk for those systems, so developers moved forward with a second round of demolition and this phase includes a lift elevator and permanent stairwell to access the second floor, but residents must be relocated from the main building to the cottages, which is why the property have retained low occupancy. Kimbrow stated that if she released the cottages for leasing, she would have no relocation plan of moving existing residents from the downstairs units out to the cottages, construct a gazebo area that is enclosed for all seasons for residents to gather, and then proceed with the 111,000 square feet.
Chairman Reid asked who the contractor is, to which Kimbrow responded that the development team has used Patton & Taylor for all phases of construction, and while the team has put a bid out for this work to Patton & Taylor, the decision has not been made on what company the development team will go with and the team is still accepting bids on this particular structure, but Patton & Taylor did all the initial work.
Chairman Reid asked Stephanie Bryant to provide any additional comments. Bryant stated that this PILOT Term began January 1, 2020, the occupancy rate never reached above 42%, which was in Quarter 3 of 2022, and the fire took place on December 29, 2022. Bryant stated that while she appreciates Kimbrow’s comments regarding her diligence with this project, there has been a complete lack of diligence in any handling of Board required reporting and any fees due. Bryant stated that Kimbrow did not respond with a year’s worth of quarterly reporting for 2025 until December 15, 2025, once the property had been placed in Non-Compliance. Bryant stated that her team, JP Townsend and Nikki Abraham, performed a Compliance Concerns walkthrough of this property September 17, 2025, and following that walkthrough, Kimbrow was sent a follow-up email from Townsend of the property conditions, what was discussed, and clearly requested specific documentation from Kimbrow with a deadline of submission stated as October 5, 2025, to which Kimbrow never responded to and did not submit the requested documents. Bryant stated that Kimbrow has not responded to much of anything and most of the information and plan she has presented here today is all new information for this Board staff. Bryant stated that Kimbrow has been one of the most unresponsive PILOT Lessees throughout the Board’s entire PILOT portfolio. Bryant stated that the Quarter 4 2025 occupancy report that was due January 31, 2026, was not submitted until Monday, March 2, 2026, and reveals there are only seventeen residents, which calculates an occupancy rate of 14% for this property. Bryant stated that Kimbrow’s response to the Notice of Non-Compliance now contemplates increasing the total number of units from 120 units to 150 units, but this property has not been in compliance for the entire term of the PILOT, and the lack of communication is deeply concerning. Bryant stated that Board staff has also received a lawsuit from Patton & Taylor for work that was performed from October 2023-July 2025 in the amount of $127,402.44. Bryant reported that Feels Like Home has consistently shown up in the delinquent PILOT payment report from the Shelby County Trustee and the City of Memphis over the term of the PILOT. Bryant reported that Feels Like Home has current delinquencies in PILOT payments of $11,050.82 due to the Shelby County Trustee and $28,161.33 due to the City of Memphis. Due to the lack of communication disrespect to Board staff, and lack of compliance for the entire duration of the PILOT term, Bryant stated that Board staff cannot recommend that the Board continue with the PILOT in its portfolio and recommended termination of the PILOT.
Kimbrow stated that representatives for Patton & Taylor are not present, and stated that there was a dispute and stated that the original amount Patton & Taylor said was due to them was $189,000 in the original correspondence, and she has just received the reduction to $129,000 because the work was not completed satisfactorily, and Kimbrow stated that her legal counsel is still in negotiations with Patton & Taylor because the property still does not have functioning lights on the property and other things that the contracts initially included that also needs to be adjusted. Kimbrow stated that as for not responding to Board staff, she will not make any excuses for filing late reports, other than she is basically a one man show trying to make this work and keep these seniors safe and happy in a reasonably nice accommodation, but to say that she has not responded at all is not true. Kimbrow stated that she believes the inspector came to the property and asked for rent rolls and some other information, and while that information was sent late, it was sent and rent rolls and other documents were provided. Kimbrow stated that she provided a lengthy response to this Board in December 2025 after a request for information came forward, which included all those items, rent rolls, and several other items. Kimbrow stated that she also believes that the numbers that are being used for occupancy include down units. Kimbrow stated that the property was purchased as a completely uninhabited eye-sore property with 120 units. Kimbrow stated that all of the units have been under renovation, and at every stage of renovation, any units that have been completed have been 80% occupied and the numbers provided today include down units and 25 unit should not be counted that are not habitable yet, but are part of the construction and renovation plan. Kimbrow stated that there are currently have 24 rent-ready units, and 20 of those 24 units are occupied and 14 cottages that are substantially complete, which is where the team is finishing the work in order for those seniors from the main building to move into for the construction period, so the numbers are not clear and substantial investment has been made into this property, and it is not a large operation, but a staff of seven (7) individuals, Kimbrow manages the property, and the residents are the other part of this.
Carpenter stated that the Board’s PILOT policies and procedures calculate occupancy based on the total number of units for the property, not the number of units that are rent-ready, but all units. Carpenter stated that one of the main points is tenant benefits and the fact that there must be tenants there to provide those benefits. The current status of the project provides a challenge for the Board, as the facility has been down since December 2022, so all of 2023, 2024 and 2025 has passed, and the property is still out of compliance with the Board’s PILOT policies and procedures. Carpenter stated that this is why this property has gone through the steps of Under Observation, Compliance Concerns, Non-Compliance, and now Legal Default, which is the last step. Carpenter stated that since staff has made the recommendation for termination, this is Kimbrow’s opportunity to outline a timetable and a plan of how the property will come into compliance so that a balance can be made by the Board as to protecting the PILOT Policies and Procedures, while at the same time facilitating the purposes of the PILOT program, and that is the focus of the conversation that should be heard now.
Kimbrow stated that in her letter in December 2025, it outlined the rebuild plan and the steps that she has undertaken, which was to finish the rendering on the new addition, would be breaking ground on this property at the end of summer, residents will be moved from the main building to the cottages around May 2026, and then constructing the exterior structure so that residents can continue to have community space while the main building is being undertaken, and the estimated timeline of this structure will take approximately ten (10) months for the 10,000 square foot structure with a lot of open spaces. Kimbrow continued, stating that there are not 120 units to be accounted for, only 65 viable units that have been salvaged, and the proposal is to build back the 90 units instead of 60 units that were destroyed, which will take the total number of units to 150 on the structure that was demolished, so instead of two stories, the structure will be three stories.
Carpenter stated that the Board’s PILOT policies and procedures require a 75% minimum occupancy rate, so for example, if only one hundred units are contemplated, how long would Kimbrow anticipate it would take to achieve a 75% occupancy rate. Kimbrow stated that the project does not have one hundred units until 18-24 months from now, which is the estimated construction timeline. Kimbrow stated that there are only 65 viable units now and she expects to reach 70% of the 65 units by the close of this year 2026, then have 18-24 months construction period that would not begin until the close of 2026 or beginning of 2027, which would get the property up to 150 units and those units would in essence be all new construction, as the ground where they stood has been leveled and no longer exist, so it would be building back brand new additional units. Carpenter asked if the insurance claims from the fire have been resolved, if there is litigation in progress, and what is the current status. Kimbrow stated that litigation has ensued because it is the development team’s belief that the insurance company did not pay the proper amount of the damages assessed, which was for 60 units being destroyed and the insurance company did not assess the damage after the civil engineer came back and said everything, including common areas, had been destroyed, so the insurance proceeds basically paid off the lender, leaving the developer to raise new capital to complete the 65 units that were left. Kimbrow stated that with the main building lost, fire safety, gas, and HVAC units were lost, and all infrastructure had to be rebuilt to make the remaining buildings usable, which has now been partially completed, occupied, and under a valid occupancy permit with all new systems. Kimbrow stated that a plan has been determined to restore everything that was left and to enhance the number of units.
Carpenter asked what Kimbrow is asking of the Board today. Kimbrow stated that she would like the Board to put the property on a 90-day report back for June 1st so that progress can be made with the funding commitments for the new structure, the completion of the outdoor amenity and relocation of tenants in the existing building to the cottages that are nearly complete and ready to occupy. At that time, Kimbrow stated that the property would undertake a new construction of all this space, which would take ten (10) months, and thereafter, the building back of another ninety units to reach 150 total units. Carpenter asked what funding commitment Kimbrow is referring to. Kimbrow stated that she expects to have a funding commitment from Pathway Lending and a couple other lenders that she has been working with over the past several months because the property currently has no debt and is financially strong enough to support new debt on the property and have a plan in place that is a phased construction budget.
Carpenter stated that the PILOT has defined terms which limits its discretion, and one thing for Kimbrow and the development team to consider in this type of situation would be for the developer to voluntarily terminate the PILOT and reapply so that it would have the full benefit of the 20-year term. B on the preliminary plans outlined by the developer, the newly constructed project, would appear to qualify for a new PILOT underwriting criterion because of the amount of resources that will be spent, and that would allow the tax abatement to be for a full 20-year term versus the current remaining term. In addition, Carpenter stated that even with Kimbrow’s best outline, this project would be 24-36 months or longer before it would be able to come into compliance with the current PILOT policies and procedures of the Board. Kimbrow stated that the development team has considered voluntary termination of the PILOT with the ability to reapply, but what she most wanted to do here today was to let the Board see and understand that this is a real place that is doing the work that this Board was established to do and this property is about the mission of serving the community and those that are in need. Kimbrow stated that this is not so much about retaining the PILOT because to be honest, the property is hurting from the PILOT and the development team is currently making an appeal to the Shelby County Assessor’s Office because the property is currently being assessed under a PILOT that includes 120 units and 111,000 square feet, where in reality, the property should be taxed on 40,000 square feet of space and that is not happening, so she would not have an objection to terminating the PILOT, but she wanted to be present today to show the Board that this is not an invisible group or a missing developer where no work is being done as has been insinuated, and the development team has put $2.8 million into the property since the devastating fire to five the residents their home back when the development team very well could have done something different.
Carpenter stated that from the Board’s standpoint, it was not looking at a decimated by fire project either, but at a senior project with 90%+ occupancy and other benefits, so the issue is that neither side is getting the benefit of the bargain as to how the project is going to proceed, grow, and develop. Wellford stated that he would think it would be better for the developer to terminate rather than the Board take action today and stated that if action were deferred for 30-days to allow the development team to consider their options in that regard, to which Carpenter stated that would be reasonable. There being no further questions or comments,
Buckner Wellford made a motion to defer action for 30 days to allow the developer to consider voluntary termination during this period and return with a better plan to move forward with a revised project. Vincent Sawyer seconded, and the motion passed unanimously after proper roll call vote of the Board members.
Monice Hagler stated that she would recommend that Kimbrow respond to the Notice of Legal Default so that the record would reflect that the PILOT Lessee responded to which Kimbrow stated absolutely.
f. Sterling Townhomes
Carpenter introduced this agenda item, stating this is another PILOT property that has been devastated by fire, shortly after entering the PILOT program in May 2025. Carpenter stated that the fire caused substantial damage to the property, and because it was an issue of such mass devastation, the property is in Environmental Court, and has created a matter of first impression for the Board’s consideration. The property was placed into a Legal Default status to give the Board the authority to take whatever action it deems appropriate. Carpenter stated that the Board received a couple of reports following its December 3, 2025 Board meeting, and the property was placed on the February 4, 2026 Board meeting agenda, but there were no representatives present to provide a status update, so the item was deferred to today’s agenda. Carpenter introduced David Shores, representative in attendance for this agenda item and turned the meeting over to him for further comment.
Shores stated that owner David Blatt was on the way to the airport to attend today’s meeting and there was an accident in front of him that stopped traffic completely and he missed his flight, so Shores apologized for Blatt’s absence. Shores stated that the property sustained three (3) fires, all arson, and there was tremendous devastation, and when the Memphis Fire Department completed putting out the fires, all the buildings were demolished, and now most of the debris has been removed. Shores stated that the contractor headed to the next building to remove the debris and Code Enforcement stopped the contractor because there was not an asbestos assessment done as the contractor did not believe he needed one due to the fire, but he is getting that done now. Shores stated that there is a hearing with the Health Department on March 18, 2026 to hopefully get the suspension of the ability to do any work on the site removed, and as soon as that is done, Memphis Light, Gas and Water (MLGW) is doing some engineering for the transformer replacement, which Shores believes will be completed by the end of March 2026, and hopes to proceed with construction on the property. Carpenter stated that the Board was advised at a prior meeting that there was some issue with the insurance and litigation had ensued. Shores stated that there is litigation, and Blatt’s entity has filed suit against the insurance agent and the insurance company, and they have filed an objection to the venue, but Blatt believes this is a delay tactic to get more time and expects the matter to be settled.
Carpenter asked that if this insurance dispute is not settled, what is the plan moving forward. Shores stated that Blatt has debt to pay off and he must rebuild the community in order to pay off that debt, and he assumes he will continue to try to do that, but the cost of what has been done so far to get rid of the fire damage, the cost of holding it in the interim as there is still security onsite, has reduced the amount of money Blatt has to complete the remaining units. Shores stated that it will not cost as much to renovate the 84 remaining units as it would have to renovate the original 112 total units, but Shores does not know if Blatt has enough money to complete the project or has the ability to find whatever additional funding it would take to complete the project. Carpenter stated that is the big question because having the property in the PILOT program means it must be performing and the Board cannot look the other way for extended periods of time without having an approved plan and demonstration of the capital necessary to execute that plan.
Shores stated that he anticipates by the Board’s next meeting, the Health Department issues out of the way, could remove the additional debris, better traction with MLGW on the transformer issue, and Blatt would be in attendance to talk about the capital stack. Carpenter stated that he would recommend deferring action on this agenda item for 30 days with the understanding that if it is not clearly demonstrated that the developer has the ability to re-establish this property that the Board would consider termination because the Board has no other option and with the current oversight and scrutiny that the Board has for its PILOT program. Shores stated that he understood. Stephanie Bryant stated that the Board staff and legal counsel have not received a written update form the PILOT Lessee since January 28, 2026, so additional written updates will be required seven (7) days prior to the next Board meeting and should include any activity that has taken place since the last update was provided on January 28, 2026. There being no further questions or comments,
There was a consensus of the Board to defer this action item to the April 1, 2026 Board meeting. No Board action is required at this time.
g. Bridgeport Manor
Carpenter introduced this agenda item, stating that the Board has spent a substantial amount of time discussing Bridgeport Manor at its February 4, 2026 Board Meeting, and Bridgeport Manor has been in Legal Default status for a significant period. Carpenter stated that there has been so much discussion on Bridgeport Manor that he does not know where to start and fill in. Carpenter stated the Mendel Fischer is in attendance today, along with his local counsel, Frank Stockdale Carney, his transaction attorney Michael Bernstein, and his property manager Neil Knopf, and turned the meeting over to Fischer to provide a status update. Fischer introduced representatives in attendance and stated that when his team left the Board’s February 4, 2026 Board meeting, he believed a good resolution was reached on how to work it out, and a call was able to be scheduled among all lenders’ legal counsels, and thanked Carpenter for leading that meeting to whatever he thought was best in the way the structure could work, as discussed last meeting. Fischer stated that Carpenter met with legal counsel for Santander Bank, legal counsel for Riverton Capital, and worked consistently with Fischer’s transactional attorney, Michael Bernstein, throughout the past month. Fischer stated that February 27, 2026, all parties received final versions of how the PILOT structure was going to work with both lenders involved, and at the last minute, there has been an issue that has come to the surface with this and the Shelby County Assessor’s Office which showed that the two (2) parcels composing the Project had been consolidated, and after researching this issue, it was discovered that this was done out of a convenience for the Shelby County Assessor’s Office, so that office is going to go back and review the matter and seek to undo the consolidation of the parcels.
Michael Bernstein introduced himself and thanked Carpenter and Stephanie Bryant for their help and involvement in this matter. Bernstein clarified that he is appearing on behalf of the Bridgeport Manor agenda item only, and has just recently been involved in this transaction, although he understands it has been going on for a while, and he appreciates the Board’s patience even though he has only recently been involved to deal with the closing and getting the property the funding to allow bringing the property into compliance. Bernstein stated that he is here to ensure things are done correctly following the issue raised concerning the tax parcels. Berstein stated the reason for the confusion is because the Board is looking for compliance with regard to the PILOT program, and both lenders are using legal counsel that is out of state, and although they have local counsel, he has not spoken with them, but is dealing with the national accounts in New Jersey and New York.
Bernstein stated that the problem is not with the transaction documents, as discussed at the last Board meeting, as the loan documents have been completed, and other issues arose due to out of state legal counsels’ lack of knowledge as to how the PILOT program works, which was compounded by this issue with the consolidation of tax parcels. Bernstein stated that after going to the Shelby County Assessor’s Office, the parcels were administratively consolidated for tax purposes, but there are still two parcels and now that all the other outstanding issues have been sorted out with both lenders’ legal counsels, the documents have been circulated and Bernstein spoke with Carpenter March 3, 2026 about some of the concerns lenders’ counsels had as it related to the PILOT. The refinancing has been divided between the two (2) separate lenders to complete the financings to get the capital necessary to fund the improvements to the property that are required. Bernstein stated that he and Carpenter discussed the issues in an email, Bernstein spoke with lender’s counsels, and initiated some of the initial or minor comments from legal counsels that they did not get in on the estoppel and the initial loan documents, and Bernstein had a call on the way to today’s meeting to have an update for the Board, and they have indicated each lender is getting clearance to close these loans no later than Wednesday, March 11, 2026 so that the these deals can be finished and the loans closed to get the funds necessary to move this forward from a PILOT level. Bernstein stated that Carpenter wanted a specific timeline provided, but he and Bryant have been involved on many of the email chains and Bernstein has continued to try to push this forward and has not been lackadaisical about it, and has taken the initiative to push back to counsel and bank representatives daily, and now he has the information he needs to tell these representatives that he has confirmed these matters as it relates to the tax parcel issue, which was one of the main concerns. Now all documents can be completed and signed off from a Board level to get this matter closed next week, and then the Board can do what it needs from a PILOT standpoint as it relates to the nine (9) month cure period to get the property to where it needs to be so that it can be in compliance with occupancy and any other outstanding compliance matters.
Carpenter advised that the parcels without knowledge were consolidated into one parcel, and because there are two separate lenders, the lenders want those separated to obtain security on one parcel each for their respective loans. Also, the current PILOT policy allows the senior lender to come into the position of the PILOT Lessee in the event of default, but because there are two lenders, neither lender wanted that option, so if there is a default, the PILOT would now be terminated; which change his Firm has no objection to. Carpenter stated that the challenge is that this has taken so much time to get here, and the representations up until now have been different than what reality is. Carpenter stated that one last issue, which he believes has now been addressed, regards a $58,000 PILOT payment that was still outstanding from 2025, and Bernstein stated that amount had been paid today and he had emailed the paid receipt.
Welford stated that he recalls at the Board’s February 4, 2026 Board meeting, the Board spend over an hour discussing that there were two (2) parcels, and the PILOT Lessee was requesting a variance to the Board’s PILOT policies and procedures so that each lender would be secured by one parcel each, and now the Board is finding out this is just one parcel. Carpenter stated that there has been two parcels all along, and it is unclear how or when the two parcels were consolidated, and that the Board had nothing to do with the consolidation. Wellford asked for confirmation that the Board does not have to deal with consideration of a variance to its PILOT policies and procedures in this matter, to which Carpenter confirmed it does not for the purpose of structuring this PILOT refinancing. Carpenter stated that the Board only needs to determine whether to allow this property to move forward with the closing of this refinancing because this property is in legal default. Carpenter stated that the remaining agenda items deal with variance requests regarding other properties in this developer’s portfolio that are seeking to complete a refinancing for those properties.
Wellford stated that he is just trying to understand what the Board is being asked to do today, because his motion at the February 4, 2026 Board meeting was to extend the timeframe to this meeting in order 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, and that is what the PILOT Lessee was coming back for today. Wellford asked what the Board is doing differently today than what was voted on. Carpenter stated that there were two lenders proposed at the February 4, 2026 Board meeting, and it was not only Santander Bank that was involved. Carpenter stated that the real issue is that there have been “drop dead” dates that this Board has set, and when that date came to pass, the Board extended the timeframe to complete the refinancing. Wellford stated that he understands that, but the issue at the February 4, 2026 Board meeting was that the arrangements with the second lender had not been confirmed and the Santander commitment was firm and ready to close, so the Board voted to allow 30 days for the PILOT Lessee to get the Santander Bank loan closed. Wellford stated his understanding was that the Board was due to consider the second lender today, and it sounds like the Board is now dealing with something a little bit different and he is not entirely clear on what it is that the Boad is doing today. Carpenter stated that the PILOT Lessee has not responded to why they did not go forward with closing the Santander loan.
Henderson stated that at the February 4, 2026 Board meeting, the Board came in ready to approve the PILOT refinancing loan for Bridgeport Manot with Santander for $32,000,000. Board’s legal counsel was advised approximately 10-14 days prior to that meeting that Santander Bank has reduced the loan amount to $27,400,000, and the PILOT Lessee brought in Riverton as a second lender for $7,500,000, and the total loan proceeds went from $32,000,000 to $34,900,000. Henderson stated that the Board was advised that the Santander loan for $27,400,000 was solid and ready to close, but there were questions from the Board about Riverton and the Board needed to get things aligned on that while also figuring out how to sort out the structure. Henderson stated that there was also discussion about the Santander loan proceeds being allowed to be used across both parcels, which he still has a question about. Henderson stated that he also had a question about the additional $2.9 million in proceeds after adding in Riverton as a lender. Hendersons stated that now it is being reported that the parcels were consolidated, but they are being looked at differently here, and now Santander is not going to be ready to close until March 11, 2026. Bernstein stated that the lenders are ready to close the loans, and the delay is not the lenders, but the issue of the consolidated parcels, which he believes is part of this confusion. Henderson stated that the issue is that at the February 4, 2026 Board meeting, Riverton was presented as part of the mix, and the Board was not expecting that curve ball. Bernstein again stated that the delay is not the lenders, but the issue of the consolidated parcels which were consolidated by the Shelby County Assessor’s Office for convenience to their office, but no notice was received that the parcels were combined. Bernstein stated that the Shelby County Appraiser’s Office, the parcels are not combined, so there was an issue of if the parcels are combined, how will that work. Bernstein stated that after speaking with the Shelby County Assessor’s Office this morning, the office is going to separate the parcels to resolve the issue.
Monice Hagler left the meeting.
Fischer stated that both lenders are ready to close, and all paperwork is ready, and that this was a last-minute issue that has come up concerning the consolidation. Fischer stated that his team did not file for the consolidation, and after the Shelby County Assessor’s Office researched the matter, it was determined that the Shelby County Assessor’s Office consolidated that parcels out of convenience, which has now caused more than a week of delays, and without those delays, he does not believe he would be here today before the Board with this issue because the loans would have been closed. Fischer stated that he needs these loans to close because he is losing a lot of money with his current lender, paying 17% because he could not close these refinancing loans by January 1, 2026. Fischer stated that Carpenter has been involved in ongoing conversations with lenders’ counsels, and he needs these loans closed. Fischer stated that he is only asking for an additional week to get these loans closed, and that he is not asking for any variances for this project at this time, only additional time to get the loans closed. Fischer went through the conversation concerning the parcels being consolitdated for tax billing purposes, as was already discussed. Henderson asked for confirmation that the request is for an additional 30 days to close both loans. Bernstein confirmed, stating that both loans will close simultaneously. Vincet Sawyer stated that it is unfortunate that the consolidation of parcels has brought about this issue and delay, but he does not have any issue with allowing the additional time to get these loans closed as the delay was not of the PILOT Lessee is doing. There being no further questions or comments,
Vincent Sawyer made a motion to defer action for 30 days to allow the developer to close the Santander Bank loan and Riverton Capital loan during this period and appear before the Board at the April 1, 2026 Board meeting. Courtnee Melton-Fant seconded, and the motion passed by majority after proper roll call vote of the Board members.
Let the record reflect that Chairman Reid voted no on this motion.
Wellford requested that at the Board’s April 1, 2026 Board meeting, Capenter Law prepare a statement to reflect the amount of time spent on the delays, requests for extensions of time, and having to referee the different issues with these lenders. Chairman Reid advised that there is an overview of legal and external monitoring expenses incurred by the Board regarding work beyond the normal course of business with this developer’s portfolio, which totals $54,978.00. Carpenter stated that information is different, and his Firm will be billing the PILOT Lessee directly for the time spent dealing with this matter, and the Board will not be charged for that work. Wellford stated that he understood and had no further questions.
h. Coronado Manor
Carpenter introduced this agenda item stating that this is a status update for Coronado Manor and turned the meeting over to Neil Knopf for a status update. Knopf stated that, as he previously reported, the property was able to change the laundry equipment vendor to a new vendor that is now under contract, and the laundry room is now operational with five (5) sets of washers and dryers that are working, with plans to get more machines from the vendor once the vendor receives those, which is anticipated by the end of April 2026. Knopf stated that he has emailed photos to Stephanie Bryant today, but it has been since the meeting began today, so she likely has not seen those.
Monice Hagler entered the meeting.
Townsend stated that he cannot verify that the laundry facility is operational because during his last inspection of the property, the laundry facility was not operational and the door was locked. Townsend stated that he is still concerned about the buildings on property that have not been completed internally, as there is still a considerable amount of flooring, ceilings, and other things that do need replacement. Townsend stated that there are still a few areas of the exterior of the buildings that require minor repairs, such as stairwells that need to be finished. Townsend stated that during his last inspection of this property, temporary blinds have been installed on the unoccupied buildings with focus only on first floor unoccupied units and asked what the purpose of those installations was. Knopf stated that the purpose of those is to cut down on vandalism. Townsend stated that it appears it is to keep people from being able to see the conditions inside the units. Knopf stated to the point of the stairwells that there are a number of staircases that have had significant repairs done to the platforms, but it is an ongoing preventative maintenance project, and Townsend will likely see crews working on stairwells during his next inspection of the property. Knopf stated that most traditional management companies do not perform the amount of work this management company does in-house, but inspections likely show how quickly these in-house crews can complete a unit. Knopf stated that he would ask that the Board consider that the carpentry type of items that are being discussed that the management company has more than enough manpower, and with items such as flooring, the in-house manpower can complete a floor installation in six (6) hours. Knopf stated that management is not rushing to complete the last few buildings because they are prioritizing things like replacing staircases on buildings that are fully occupied. Knopf stated that management will take care of the remaining items, as there is an in-house crew that completed that work, and there is nothing in a unit at Coronado Manor that cannot be completed within two (2) days.
Fischer stated that one of the things that he does look at since being in legal default is occupancy, and the laundry faciality was one of the things that was holding the property back from getting out of legal default and thankfully that is now in service, and he now considers this project completed. Fischer stated that there is one thing that he openly realizes is that vandalism is a very big issue. Fischer stated that the property has 24-hour security and thankfully this area is very quiet, but still, there are kids with bb guns that shoot at the windows, which is why temporary shades were installed, to try to reduce those types of issues, because if the kids think someone could be behind the shades, they will not target those windows. Henderson asked what the current occupancy rate is, to which Bryant stated 78%. Henderson asked if there has been anything more recent submitted since Quarter 4 2025, to which Bryant stated yes, a rent roll that was submitted in January 2026, but there was no change in the rate of occupancy.
Bryant stated that her concern is that the commitment to the Board was that December 2023, the construction of the project was going to be completed, which was then revised Summer 2024, then revised to February 2025. Bryant stated that while she understands Knopf’s comments when he stated that these are minor repairs that can be completed in two (2) days, why are they not done, and this is not the first time this issue of completion of the project has come up. Bryant stated that walls missing, flooring missing, and bathroom vanities and fixtures missing are not a complete project. The second issue Bryant stated was outstanding PILOT payments due to both the Shelby County Trustee in the amount of $23,807.02 and the City of Memphis in the amount of $24,865.94. Bryant stated that this property had a PILOT Refinancing approved in June 2023, and there has been no additional PILOT Refinancing application submitted for this project and asked what it will take to get this project completed. Bryant stated that the developer has been consistent with not installing HVAC units until a unit is rented due to the concern of theft, and the Board and staff have worked with you on that and understand that, and that is not unreasonable, but this situation is unreasonable.
Fischer stated that since he has had the issue with lenders not paying the PILOT payments because the way that PILOTs are being recorded, banks have an issue, and thankfully those issues were resolved last year, but he has had to explain to his lenders that the property is not paying regular tax payments, but a payment in lieu of taxes, and a majority of out-of-state banks that do not have the right capacity to pay PILOT payments, even though the property has escrowed double the payment amount for taxes. Fischer stated that he got hurt by another lender on this same type of issue, and that is something he is now trying to figure out on the front end with the lenders he is going with now because of PILOT payments. Fischer stated that he does have intentions to refinance Coronado Manor, as he is paying a traditional bank over 7% interest on his current loan, but he has not done that yet because he wanted to wait a little longer. Fischer stated the reason he does not complete these types of items is because his properties encounter a lot of theft, including from units that tenants were due to move into the next day. Fischer stated that he is not blaming the security person because he is there, and he is a good guy, and he is thankful to have him, but there are no shootings, killings, or fires on his properties. Fischer stated that as soon as these types of items are installed, a kid comes along and picks up a vanity out of a unit, and it does not have to be a sophisticated thief to do this. Fischer stated that there has been theft of air handlers and theft is something he just deals with and is thankful that theft is not as bad as it used to be, but he has just recently put glass in over 250 units that now the glass has been broken and he will have to replace the glass again. Fischer stated that he does not want to board up the units because he does not want the property to look boarded up, but vibrant and full. Fischer stated that he and Knopf were laughing because during the recent icy weather, there was a guy that back up his vehicle to a unit and in front of a security camera loaded up a condenser from an occupied unit, so theft is unfortunate but he lives with it and is thankful that overall, his properties are very quiet.
Bryant stated that she finds that response unbelievable as well, because if these properties are experiencing ongoing theft issues, and although Fischer thinks his security personnel is a great guy, you can like the security personnel all day long, but if the security personnel is not performing the basic functions of deterring theft, she is unclear if this is operational security, which raises even more concern. Knopf stated that if Bryant were to pull crime report data from the row of houses directly across the street from Coronado Manor, she would see a wild number of calls because the number of homes there that are used for illicit purposes is more than 50% of them. Knopf stated that unless the Board wants him to hire whoever is available from the National Guard to secure this property, there is only so much a security company can do. Knopf stated that he would prefer to have the focus on the tenants than the windows at the back of the property that are facing a row of houses that no tenants are living in. Knopf stated that things do happen, even with security, and if the Board reviewed what is happening on other properties, there are far worse things happening and he feels strongly that he is securing the tenants. Knopf stated that they do leave certain things out of a unit due to theft because it is better not to be worried about the vanity being stolen instead of worrying about someone stealing a condenser and the security can focus on where the tenants are living and that is where he wants them.
Wellford asked for confirmation that this property has 24/7 security on site and new security cameras that have been installed, to which Knopf confirmed yes. Wellford stated that there was a $1,000 PILOT Compliance Deficiency Fee assessed at a prior meeting and asked if that had been paid. Bryant advised that the motion was that the $1,000 PILOT Compliance Deficiency Fee would be assessed and Board staff was to perform a review of the legal and external monitoring expenses incurred by the Board to determine if that would be the final assessment, or if there would be an addition to that assessment, and once that decision was determined by the Board, there would be a determination on when that PILOT Compliance Deficiency fee would be due and payable. Chairman Reid asked for a staff recommendation. Bryant stated that her recommendation is only based on the PILOT policies and procedures and the fact that construction is still not completed, the property has been in Legal Default for more than six (6) months, and there has been no progress on property during that time, so Board staff’s recommendation is to terminate the PILOT simply because Board staff does not see any movement in construction. Carpenter stated that the occupancy seems to be in compliance as it is over 75%. Bryant agreed that the occupancy rate has increased, but the construction is not complete. Bryant stated that she only makes this recommendation on a staff level because staff has exercized every tool at its disposal and is at a loss of what to do to move this project forward to get the construction completed. Bryant stated staff is just at a true loss and she would like to say that staff does not have a recommendation because the Board’s purpose is to provide affordable housing, and while the developer is trying to do that; however, Board staff has not seen any progress from a construction standpoint to complete the project and Board staff is at a loss.
Sawyer stated that he believes Wellford’s point concerning the PILOT Compliance Deficiency Fee is a good one, but he believes that termination of the PILOT would be too drastic at this point provided the increase in occupancy and the incentive is the stick rather than the carrot approach and would be supportive of imposing additional fees or factor that in when determining what the assessment will be of PILOT Compliance Deficiency Fees. Wellford stated that the property is in a Legal Default status right now, so the Board would need to either continue that status or move the property down one level. Sawyer stated that his understanding is that a PILOT property would not typically be moved out of Legal Default status until the property has come into compliance and asked if the process is to go from Legal Default status to Under Observation status or some other step. Bryant stated that the four steps include Under Observation, Compliance Concerns, Non-Compliance, and Legal Default and typically a property is not moved out of Legal Default until the property has come into compliance, and then it is moved to a lower level of Compliance Concerns. Henderson stated that he would recommend moving Coronado Manor down a level to a Notice of Non-Compliance status in order to maintain monitoring because the PILOT Lessee has not completely complied with tenant benefits, such as the laundry room that is operational but still is waiting on additional equipment, and with the increase in occupancy from 46% at the beginning of 2025 to 78% during Quarter 4 2025, which is the saving grace in his view. Henderson stated that he would like to put on record to respect Board staff and what they need and how they are viewing the property. Fischer stated that he has been very responsive to the Board staff. Wellford asked if he could amend the recommendation of Henderson to assess a $2,000 PILOT Compliance Deficiency Fee that is due and payable as part of this motion.
Cliff Henderson made a motion to move Coronado Manor from Legal Default status to a Notice of Non-Compliance status accompanied by the assessment of a $2,000 PILOT Compliance Deficiency Fee. Vincent Sawyer seconded, and the motion passed by majority after proper roll call vote of the Board members.
4. PILOT Refinancing Application for Mazal in Eden, LLC and Mazal in Eden 1, LLC (d/b/a Eden Pointe Apartments): Request for variance to allow refinancing application to be considered by the Board while certain properties in the developer’s portfolio are in legal default status
Carpenter introduced this agenda item, stating that Action Items 4, 5, and 6 also deal with the same developer for Bridgeport Manor and Coronado Manor, being Mendel Fischer. Carpenter stated that this is a comparable situation as to what has already been discussed. Since the portfolio includes properties that are in Legal Default status, for any action to be taken, there must be a variance approved by the Board, otherwise, the Board’s PILOT policies and procedures do not allow for consideration of an application while a developer has a PILOT property under a status of additional compliance oversight. Carpenter stated that today, these next three (3) action items are a determination of whether the Board will allow a variance for this developer to put forth PILOT Refinancing Applications for these three (3) projects. Carpenter clarified that there will not be a determination today for the PILOT Refinancing Applications, but only whether the Board will allow the variance, which would allow legal counsel and Board staff to move forward with the application submission process. Carpenter turned the meeting over to Fischer for any additional comments.
Fischer began with the Eden Pointe and Scenic Hills variance requests, stating that both properties were in legal default status, but have now been moved to regular monitoring. Fischer stated that there is a loan he took out several years ago that he would like to refinance due to the current environment yielding better terms and he would like to take advantage of that. Fischer stated that all three (3) of these properties are fully occupied, and these refinancing requests are with a Freddie Mac lender, and he has the term sheets. Fischer asked that when a property is fully compliance with the Board’s PILOT policies and procedures, how does the Board maintain the process of approval should take this long, because when he gets a Freddie Mac term sheet, it is only valid for five (5) days, so if he has one now, the Board will determine if the application can go through the process today, then, if approved, the application will not be considered until the next Board meeting in April, making is where a closing cannot take place until May or some later timeframe. Fischer asked why the developer is being punished, and when there is a compliance issue, then there is a compliance issue, but these projects do not have compliance issues, are fully occupied, and he is paying a little over 7%, when he has the opportunity to refinance at a lower rate, but now he will have to bleed out for 3-5 months just to get where he wants to get. Fischer stated he does not understand why he needs to ask permission to even submit a PILOT Refinancing Application.
Monice Hagler asked for clarity of what the action item is, to which Chairman Reid stated that it is an action item to request a variance to the Board’s policies and procedures, which should be held for the best performers in the Board’s PILOT portfolio, to continue ahead with refinancing of these three projects, Eden Pointe, Grainge Hill, and Scenic Hills. Hagler asked for clarification on why a variance is necessary. Chairman Reid stated it is because the developer’s portfolio includes other properties that are not in compliance. Chairman Reid stated that the inordinate amount of time spend today on Bridgeport Manor and Coronado Manor are due to this developer having properties in his portfolio that are not in compliance. Carpenter stated that the variance is necessary because there is a default of a property in the developer’s portfolio, and if this developer’s portfolio only consisted of these three (3) properties, a variance to the Board’s PILOT policies and procedures would not be required. Carpenter stated that because Bridgeport Manor remains in Legal Default status, and other PILOT projects of the developer are also in Legal Default status, it allows the Board to look at the big picture of the developer’s portfolio as a whole to see if there are problems or trends that may keep a property from operating as it should, and the variance process enables the Board to accomplish this review. Buckner Wellford stated that this should answer Fischer’s question, as the Board only has limited tools to ensure compliance, and part of it is PILOT Compliance Deficiency Fees.
Carpenter asked Stephanie Bryant to provide additional information on the current standing of these three (3) properties and occupancy rates. Bryant stated that Eden Pointe and Scenic Hills are both in good standing from an occupancy and compliance standpoint, but with Grainge Hill, the property is still in an Under Observation status due to a tremendous erosion issue on property. Bryant stated that management did address the erosion issue from a safety perspective with a temporary solution, but no permanent solution has been put in place. Bryant reported that staff has received current reports from the Board’s external compliance inspectors that there are great concerns about the erosion issue at this site because erosion is taking place in two (2) areas on property. JP Townsend stated that one area is much more substantial than the other. Bryant reminded the Board that this property has remained in Under Observation status because Board staff have not received a plan for a permanent solution and no permanent solution has been completed on site for these erosion issues, which have only continued to progress into the parking lot. Townsend stated that both his reports and external compliance inspector reports reflect concerns with some areas of aging roofs. Townsend stated that Neil Knopf was onsite during one of Townsend’s inspections of Grainge Hill and he advised him of the concerns with the aging roofs, which have now created soffit areas that appear to have water damage, and these concerns are also present in external compliance inspection reports. Townsend stated that Eden Pointe and Scenic Hills, he can confirm that both properties are in compliance.
Knopf stated that the two areas of erosion being referred to at Grainge Hill involve a drainage ditch that management believed was the responsibility of the City of Memphis, but the City has come back and said that the responsibility is to the property owner, even though it is the City’s drainage ditch and not the properties’ responsibility. The developer had a contractor that was going to start work, then the other erosion side occurred and he decided to take a step back to see if the grading plan was the correct path or whether the issue required a second opinion. Knopf stated that he has an idea of how to move forward and once he finishes assessing the second opinion, he will move forward. In the meantime, Knopf stated that in addition to the temporary fencing of the area, he did move the fence over to a permanent chain-link fence that is drilled down into the blacktop. Knopf stated that he has no safety concerns of anyone getting too close to the erosion, and it is a fact that exists around the drainage ditch, but he has handled it. Knopf stated that the roofing and soffit that has been referred to has been repaired and he does not believe the roof was leaking and believes this was just a gutter issue. Knopf stated that Grainge Hil does have some older roofs, and if there is ever a roof leak, he addresses it quickly, and there are a few roofs that have been replaced entirely, because there was a leak, but those kinds of things take a long time and he is able to replace a roof at a property like Grainge Hill when a leak has spread, but it is not a major issue. Knopf stated that ownership will have to do more roof replacements in the future, but they are not leaking right now.
Fischer stated that he knows this issue is not on the agenda, but something he is planning to do when he gets approved for the variance, and the refinancing is really because of this ditch. Fischer stated that he understands that the Board looks at tenant benefits and compliance, but this issue is not really affecting the property and it is just for storm water for the City that goes through the property, and it is also at the back of the property where he had to build a retaining wall, but it does not affect the property and it is not a tenant benefit and is not harming the property. Fischer stated that it is just something that happened to be there. Fischer stated that he is assuming when a Property Condition Report for the bank is done, he is going to have to figure out exactly what it says he must do, and he has gone through a few routes of what to do with it and he thinks he has made the decision to do it the right way and spend the money so he should not have this happen again, which is why he permanently fenced it, but it does not hurt anything or take away from the property.
Bryant advised the Board that each of these three (3) properties have outstanding balances with the Shelby County Trustee and City of Memphis as follows:
Eden Pointe: Shelby Country Trustee PILOT payment balance of $17,398,89
Grainge Hill: Shelby County Trustee PILOT payment balance of $4,965.96
Scenic Hills: Shelby County Trustee PILOT payment balance of $10,169.19 and City of Memphis PILOT payment balance of $10,580.17
Bryant also advised the Board that PILOT Refinancing Application Summary drafts included in the Board’s materials were prepared so that the Board would be aware of what was submitted, but there has not been a submittal conference, where a lot of this type of discussion would normally take place, and there has been no application fee paid because the PILOT Lessee is at the stage of requesting this variance. Bryant stated that the Board considered a variance request like this for Bridgeport Manor in the past and had expressed concern at that time of having no initial detail of the application to review, so that is the reason for the preparation of the draft information included in the Board materials today. Bryant further explained that this information is not provided to review as consideration of the application itself, but only to review the request for the variance, which would grant the permission of Board staff and legal counsel to proceed with the application submission process. Chairman Reid stated that this Board put together the framework so that if a PILOT Lessee is under any additional compliance oversight step (Under Observation status, Compliance Concern status, Non-Compliance status, or Legal Default status), with any property in a developer’s portfolio, that the Board would not entertain a PILOT Refinancing Application for any other property in that developer’s portfolio. Wellford asked for confirmation that this is a written policy, to which Chairman Reid confirmed it is. Chairman Reid asked for a motion from the Board, to which Henderson asked for clarity on the motion. Wellford stated that the motion would allow the variance for the application to move forward with the process. Hagler stated granting the variance would allow the property to stand on its own. There being no further questions or comments,
Monice Hagler made a motion to approve the PILOT Refinancing Application for Mazal in Eden, LLC and Mazal in Eden 1, LLC (d/b/a Eden Pointe Apartments. Buckner Wellford seconded, and the motion FAILED after proper roll call vote of the Board member due to lack of majority.
Let the record reflect that Monice Hagler, Buckner Welford and Vincent Sawyer voted yes, Chairman Reid, Cliff Henderson, and Courtnee Melton Fant voted no.
This action item failed, and no variance was granted.
5. PILOT Refinancing Application for Mazal in Grainge Hill, LLC (d/b/a Grainge Hill Apartments): Request for variance to allow refinancing application to be considered by the Board while certain properties in the developer’s portfolio are in legal default status
Hagler stated she would make a motion to allow a variance for Grainge Hill, and Wellford stated that he would support a motion to allow this variance and stated that this property reflects a 93% occupancy rate. Wellford stated that he thinks if the erosion issue is a concern, he would assume the lender is going to express concern about it, and a refinancing may help to solve the problem if the Board votes to allow this project to move forward, and he understands the issues. There being no further questions or comments,
Monice Hagler made a motion to approve the PILOT Refinancing Application for Mazal in Grainge Hill, LLC (d/b/a Grainge Hill Apartments). Buckner Wellford seconded, and the motion FAILED after proper roll call vote of the Board member.
Let the record reflect that Vincent Sawyer voted yes, Chairman Reid, Cliff Henderson, and Courtnee Melton Fant voted no.
This action item failed, and no variance was granted.
6. PILOT Refinancing Application for Hightop Ridge Apartments, LLC (d/b/a Scenic Hills Apartments): Request for variance to allow refinancing application to be considered by the Board while certain properties in the developer’s portfolio are in legal default status
There were no further questions or comments, and no motion was made by any Board member.
This action item failed, and no variance was granted following no motion from the Board.
Fischer asked if the next stage is to terminate the PILOT if he wants to refinance the PILOT property. Henderson stated that the next stage should be to work to get Bridgeport Manor and Coronado Manor out of additional compliance oversight. Fischer stated that Coronado Manor was moved down to Non-Compliance status today, and to get it out of additional compliance oversight could take three (3) months or more, and then Bridgeport Manor will be out at the next meeting because the refinancing will be completed and he will be done with that. Henderson stated that Fischer had a split vote, and he thinks the developer had done just enough to show some progress, but the tilting factor for Henderson was the outstanding PILOT payment balances, and Henderson, in good conscience, go forward with that. Henderson stated that he would not have an issue with the developer requesting the variance at the Board’ next meeting. Fischer asked if the Board would consider the variance and the PILOT Refinancing application at the same meeting and stated that he would not be able to attend the April 1, 2026 Board meeting due to religious holiday. Wellford stated although the Board has a policy that a PILOT Lessee or aplicant must appear in person before the Board, he would be willing to allow the PILOT Lessee to appear by Zoom to accommodate the religious holiday, but Wellford is unsure if that would help. Fischer stated it would not. Bryant stated that in the Board’s history, it has set a precedent that in the event of a Board Meeting date falling on a religious holiday that a PILOT Lessee observes, the Board would make the concession and allow a representative to attend that Board meeting in the PILOT Lessee’s place to speak on the upcoming action item so that the PILOT Lessee is able to observe that holiday. Bryant stated that Frank Carney has appeared in the same such circumstance for this PILOT Lessee in the past when a Jewish Holiday was being observed by the PILOT Lessee. Bryant stated that the Board has the authority to proceed however it wishes in this circumstance, but that is the precedent that has been set. Chairman Reid asked that Board staff and legal counsel discuss this issue following today’s meeting. There were no further questions or comments.
Executive Director Report
a. McKnight stated that the Tennessee Affordable Housing Conference was a success and thanked those Board members and staff that were able to attend. McKnight stated that it was a topic of conversation as to how well represented the Board was. McKnight reported that he, Vincent Sawyer, and Dexter Washington of MHA has on opportunity to participate in “Day on the Hill” and met with State Representative Justin Pearson, Senator London Lamar, and State Representative Joe Towns and asked Sawyer to say a few words. Sawyer stated that he was impressed with McKnight’s advocacy efforts, and he hit all the issues on the nose and was impressed with how McKnight got the points over and made the issues clear for the representatives. McKnight stated that he talked about keeping $35 million in the budget, as it used to be $60 million, but now he is advocating for $35 million to remain in the budget to hopefully be used for a 0% interest loan fund for minority builders, which would help West Tennessee. McKnight stated that the $35 million is a reduction from th $60 million previously in the budget, but $35 million is better than nothing. McKnight stated that all three (3) representatives stated that they would not stand in the way of it, and that Senator London was a little miffed with Washington, but they were able to get past, that and she had some MHA questions and Section 8 questions that they got past, and she said she would not stand in the way and would advocate for this. McKnight reported that Pearson was excited about what McKnight had to say and thanked Sawyer for attending those meetings with McKnight.
b. McKnight reported that he is really, really close with the website and has a drop-dead date of the website going live on July 1, 2026. McKnight stated that he has received that last iteration of the agreement and will be able to move forward with signing it. McKnight thanked the working group consisting of Chairman Reid, Vincent Sawyer, Cliff Henderson, and Stephanie Bryant for looking at the agreement and helping him with all the information. McKnight stated that he knows the information has been cumbersome for this working group, but it will be worth it in the end because the Board will have a really, really cool website finally.
c. McKnight reported that Mayor Young has called all the Executive Directors together for Economic Development Growth Engine (EDGE), this Board, and Downtown Memphis Commission (DMC), and he has been participating in bi-weekly meetings. McKnight stated that Mayor Young is looking for these groups to collaborate with each other to make sure he gets to his 10,000 single-family homes within the core of the City. McKnight stated he does not kow exactly how this group will get there yet, and Mayor Young has acknowledged that publicly, but this group will do whatever it can to assist, and thankfully since he is in the room, and he will be able to do whatever is needed to assist Mayor Young.
d. McKnight reported that he has recently had a meeting with a new developer, Todd Harris of Metropolis Real Estate, who is looking at two (2) parcels in Whitehaven he is looking to develop. McKnight stated that he has connected Harris with Dexter Washington of MHA, and the developer already has control of the site and is looking at doing affordable housing with a mixed-use facility in the Whitehaven community. McKnight stated that he has introduced Harris to Dexter Washington of MHA so that he can look at their program because the developer is looking at Section 8 vouchers and things of that nature. McKnight stated that he has assured the developer that he will hand-hold him through the entire process to try to get this going.
e. McKnight reported that he was re-elected as the Regional Chair for West Tennessee for the Tennessee Affordable Housing Coalition. McKnight stated that he beleives it is a good thing to continue to keep the Board’s name out there and continue to do work.
There were no further questions or comments.
Operations Report
Stephanie Bryant presented the Operations Report as follows:
a. Review of Compliance Oversight for February 2026
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:
February 2026 Compliance Review for March 4, 2026 Board Meeting
1. Under Observation:
a. The following PILOT properties are currently in Under Observation status:
1. 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.
2. 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.
3. River City Townhomes: PROGRESS-75% 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.
4. University Place II & III: PROGRESS- University Place II-84% Occupancy Rate, University Place III-85% Occupancy Rate; Property was moved down from Compliance Concerns to Under Observations during February 2026; 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 that was approved at the February 4, 2026 Board meeting.
1. Compliance Concerns:
a. One (1) PILOT property was placed in Compliance Concerns status from Under Observation status during February 2026:
1. 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, but roofing issues remain, damaged windows, and excess trash.
b. The following PILOT properties are currently in Compliance Concerns status:
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 posted on Laundry Room; laundry equipment has been installed, but laundry room does not appear functional; drive remains under repair and has been under repair for several months.
3. Notice of Non-Compliance:
a. Two (2) PILOT properties were placed in Non-Compliance status from Compliance Concerns status during February 2026:
1. Mill Creek: SLOW PROGRESS- 69% Occupancy Rate; Very slow progress continues with siding repairs. Occupancy rate has declined. Due to slow repairs and declining occupancy rates, staff have determined movement up the step-program is necessary and Notice of Non-Compliance is forthcoming.
2. Villages at Harrisson Creek: STATUS QUO- 75% Occupancy Rate; No real progress has been made to the completion of this property; therefore, staff have determined movement up the step-program is necessary and Notice of Non-Compliance is forthcoming.
b. 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.
2. Legal Default:
a. One (1) PILOT property was placed in Legal Default status during February 2026:
1. Cedar Run: PROGRESS-80% Occupancy Rate; Some minor exterior items (soccer pad) remain outstanding, but consistent progress has been observed. Staff had planned to step down to regular monitoring in February 2026, but legal counsel received a Notice of Foreclosure, which has prompted Legal Default status.
b. The Following PILOT properties are currently in Legal Default status:
2. 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.
3. 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:
A. Abington Apartments: DECLINE-57% Occupancy Rate; Legal Default issued January 22, 2026
B. Country View Apartments: DECLINE-69% Occupancy Rate; Legal Default issued January 16, 2026
C. Jamesbridge Apartments: DECLINE- 52% Occupancy Rate; Legal Default issued January 16, 2026
D. Lakes at Epping Way: DECLINE-55% Occupancy Rate Legal Default issued January 22, 2026
4. 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.
5. 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.
6. 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.
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 construction is substantially complete, all furniture is due to be installed by March 6, 2026, and all internet and IT services will follow in the coming weeks. Bryant stated that she anticipates no additional delays and expects the April 1, 2026 Board meeting to be held at the Board’s principal office.
c. Board Policy Proposal
Bryant stated that she would like to preface these proposals by stating that she is not requesting any action from the Board today, but would like to ask that the Board think through these two (2) policy proposals over the next month, and for the April 1, 2026 Board meeting, she will be including a formal written proposal for the Board’s consideration. Bryant proposed the following:
1. A Legal Default Fee or fine associated with the Notice of Legal Default to be assessed and payable upon issuance of a Notice of Legal Default. Bryant advised that when a property gets to a Legal Default status, the issuance of the Notice of Legal Default costs the Board anywhere from $5,000-$10,000, which includes legal expenses, external monitoring expenses, and other efforts that go along with an issuance of a Notice of Legal Default. Bryant stated that this proposal comes from the experience of the Board, that when a property is issued a Notice of Legal default, it seems like many PILOT Lessees are not beginning any action to address compliance issues until a Notice of Legal Default is issued, rather than during an earlier stage of additional compliance oversight. In an effort to remediate some of these ongoing Legal Default status issues, Bryant stated she would ask the Board to consider a fee or fine to be assessed at the time a Notice of Legal Default is issued. Bryant stated that she would envision that this fee or fine would be invoiced from the Board and would provide that invoice to legal counsel to be included as part of the Notice of Legal Default. Bryant stated that she is recommending an initial Legal Default Fee of $10,000, which would encompass all additional expenses incurred by the Board for a property that is placed in Legal Default status.
2. A written policy stating that all submissions to be reviewed by the Board at an upcoming Board meeting must be submitted no less than seven (7) business days of said Board meeting to be discussed and/or considered at that upcoming Board meeting. This policy proposal is an attempt to alleviate last-minute submissions, and last ditch efforts of PILOT Lessees or applicant submissions that the Board staff and legal counsel have not had appropriate time to review, nor enough time to provide to the Board members for their proper review prior to a Board meeting. Bryant stated that if a submission is not received within that seven (7) business-day period, barring any emergency of natural disaster, fire, etc., that the submission would not be considered until the following Board meeting after all parties have had the appropriate time to review and share with the Board for proper preparation and discussion.
Chairman Reid stated that he is fully supportive of these proposals and for the Board to think about, and for these proposals to become an agenda item for the Board’s April 1, 2026 Board meeting. Chairman Reid stated that it is extremely frustrating for Board staff and legal counsel to receive submissions close to, even up to the night before or day of a Board meeting, which has happened more frequently. Chairman Reid stated that regarding a Legal Default Fee or fine, that when fees, fines, or penalties or involved and when something is going to be levied against someone, those issues are usually taken much more seriously, particularly when it hits the pocketbook. Cliff Henderson stated that he agrees with Chairman Reid but would encourage Board and Board staff to consider a fee or fine at the time of Notice of Non-Compliance status level and then step that fine up with the Notice of Legal-Default status level. Chairman Reid stated that those are great ideas. Henderson stated he is looking at the timeline with Feels Like Home Senior Living Residences, he does not feel that the developer paid attention to the Board staff during the September 2025 Compliance Concerns walkthrough of the property, and no response was provided until December 2025, following Notice of Non-Compliance, so he would encourage consideration of additional fines. Vincent Sawyer stated that he would consider going a step further with fines and fees should go to specific issues with the property when it gets to an Under Observation status or Compliance Concern status. Sawyer stated he would also encourage the Board and Board staff to make a distinction between things that happened a week ago and information was received today versus things that happen today so that the Board can be sure it is receiving as much real-time information as possible. Bryant stated that the purpose of proposing the submission policy is to encourage these PILOT Lessees and applicants to properly communicate with the Board staff so that Board staff can carefully review and share that information with the board for their review. Bryant stated that staff spends a lot of time preparing Board meeting materials for the Board and Board staff tries to ensure the Board receives materials no less than a week prior to the Board meeting to allow Board members to review that information to prepare for each Board meeting. Bryant stated that again, this is an attempt to encourage better communication and preparation by PILOT Lessees and applicants so that things are not being submitted in the ninth hour. Bryant thanked the Board for their comments and stated she will be including these policy proposals as an agenda item on the Board’s April 1, 2026 Board meeting agenda.
Finance Committee Report
Cliff Henderson presented the financial results for the month ending January 31, 2026. After discussion,
Vincent Sawyer moved for acceptance of the Finance Committee Report for the month ended January 31, 2026, properly seconded by Courtnee Melton-Fant, 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 one of the big highlights for the period is the Strategic Planning Committee continues to work toward an off-site Strategic Planning Session for the Board. Henderson stated that Stephanie Bryant has sent out a Board poll with some date options, so that is in process. Henderson stated that the Committee has been able to contact the Memphis Police Department (MPD) about data. Henderson stated that a meeting took place with Deputy Chief Brown of MPD. Henderson stated that there has also been some news concerning Ting, the Internet Service Provider (ISP) for the Smart Memphis Fiber Initiative in collaboration with Meridiam and mStreet. Henderson stated that one of the things the Board needs to be careful of is that Ting is the ISP and is not the partner with the City of Memphis rolling out the infrastructure, and there are some backstops with the issue that Ting is experiencing some financial issues and the parent company is going to divest them while still keeping things in play for Memphis and for Ting to serve as the ISP. Henderson stated that this is not affecting the mStreet rollout of the infrastructure. Henderson stated that a lot of things are happening, but the infrastructure continues to be rolled out, Ting does have financial challenges, and mStreet along with the City is going to work through those challenges, and there will be more to come on that.
Humes stated that Deputy Chief Brown is in charge of the Real Time Crime Center and all the data for MPD and Chief Davis connected the Strategic Planning Committee with Brown and Brown would like to partner and share as much data and information that MPD has and is willing to open up and help the Board with development of a Power BI dashboard. Humes stated the Brown had some good ideas of the Board connecting with the Neighborhood Watch Coordinators, of which each precinct has one. Humes stated that the Committee has identified which PILOT properties are in which precinct with the help of Stephanie Bryant, so the Committee plans to work with each precinct Neighborhood Watch Coordinator because they do have monthly Apartment Manager meetings for all apartment complexes in each precinct, and Humes plans to plug the Board into those. Humes stated that the next step is to meet with Deputy Chief Brown, who has five (5) analysts on staff, go down to the Real Time Crime Center, and dig into the data they have, and Brown sees the benefit in partnering with the Board and in helping the Board develop a playbook. Humes stated that there is already a playbook under the Neighborhood Watch as to what a community or complex must do to be in compliance with the Neighborhood Watch Program. Henderson stated that Deputy Chief Brown is also interested in participating in and being a part of any PILOT Lessee Training Workshop that the Board hosts in the future. Humes reminded the Board that mStreet, through Meridiam, is the entity that is spending the $850 million in capital to build the fiber network, and in some of the markets that Ting has divested themselves, those were capital-heavy projects where Ting was building fiber, but that is not the case in Memphis. Humes clarifies that Ting is the street-to-home provider, so Ting has no capital expense, which is why Ting has kept Memphis because it is capital-light for Ting. Humes stated that the parent company, Tucows inc., released a report on March 3, 2026, that tells that two of the business units are doing very well, and Ting is improving but not where they should be because of the past year’s financials were still capital-heavy. From a long-term perspective, Humes stated that mStreet is open to a $25 price point for every unit for a long-term basis anywhere from 7-10 years for affordable housing units. Humes reported that this price structure has already been put into place with Alco Management, Inc. and with The Works, Inc., and he is hopeful that it is something the Board can get mStreet to agree to moving forward. Humes stated that the retail rate is $90 amount, reduced to $25 for the same product, two gigabytes up and down. Humes reported that he has a set meeting today with Jason Mulligan, who is now embedded with the City as the owner’s representative working with mStreet. Humes stated that Ting fired their CEO in December and mStreet fired their CEO in January, so it is a new day of leadership and things are on track. Humes stated that Mayor Young is plugged into all this progress, as is Doug McGowan at Memphis Light, Gas and Water (MLGW) because all this fiber goes through MLGW’s infrastructure. Chairman Reid asked if there is any concern from the City Administration or MLGW about the change in leadership at Ting and mStreet. Humes stated no, the changes are viewed as positive. 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, April 1, 2026 @ Noon. There being no further business, the meeting was adjourned by the Chairman at 3:27 p.m.