Tools in the toolbox: Timing
Historic tax credits are powerful tools - but only when timing is treated as a core structuring issue, not a downstream compliance task.
From a historic tax credit perspective, many project challenges don’t stem from eligibility or credit amount. They arise from misaligned timing among development schedules, financing milestones, and compliance requirements - especially when bridge financing, equity contributions, and layered funding sources are involved.
Timing matters at every stage of an HTC deal, including:
- Coordinating Part 1 and Part 2 approvals with site acquisition, construction commencement, and lender requirements;
- Meeting approval timelines and completion deadlines tied to public and private funding sources and incentives;
- Aligning bridge loan advances with delayed equity capital contributions from HTC investors;
- Managing carry costs and risk during extended bridge periods; and
- Sequencing placed-in-service dates to ensure timely equity pay-in and bridge takeout.
When these timelines are thoughtfully aligned, historic tax credits integrate smoothly into the capital stack. When they aren’t, timing gaps can strain cash flow, increase risk, and put credits or other sources of funding at risk.
The strongest HTC projects recognize timing as a shared responsibility, aligning the capital stack and approval process so each layer works together - not against the deal.
If you’re navigating a project with HTCs and want to talk through timing, approvals, or overall project finance strategy, I’m always happy to connect. Feel free to reach out and discuss.
