LIHTC Market Study and Feasibility Case Study: 9 Percent Family Apartments in Macon-Bibb County, Georgia, Not Feasible as Proposed

A 72-unit family development proposed with every unit at 60 percent of area median income on a 6.0-acre R-3 site in east Macon, tested against the Georgia Department of Community Affairs' 2026-2027 Qualified Allocation Plan and 2026 Market Study Manual. In the subject's primary market area of older rental stock, the 60 percent tier clears the achievable market rent by 6.8 to 8.0 percent, below DCA's 10 percent rent advantage threshold, and the application cannot be scored. The written determination is not feasible as proposed and feasible as redesigned: 44 units at 50 percent of area median income with an advantage above 33 percent, 28 units at 70 and 80 percent priced below market, a weighted average of 59.7 percent, a permanent loan of $2,193,000 at 1.20x, and an annual federal credit request of $1,049,800 with the matching Georgia state credit on a $17,500,150 total development cost.

Model study prepared by MMCG Invest | Michal Mohelsky, J.D., FMVA | October 1, 2026

MMCG concludes that the proposed 72-unit family development in east Macon is not feasible as proposed and is feasible as redesigned. The proposal places all 72 units at 60 percent of area median income, where the 2026 maximum net rents after utility allowances are $741 for a one-bedroom, $884 for a two-bedroom and $1,011 for a three-bedroom. In the subject's primary market area, where the rental stock is older and the achievable market rents MMCG models are $800, $950 and $1,080, those rents clear the market by 8.0, 7.5 and 6.8 percent under DCA's formula, which divides the gap by the proposed rent, and DCA's 2026 Market Study Manual requires at least 10 percent at 60 percent of area median income or below. An application that fails that threshold is not scored, so the proposal is not feasible regardless of its demand, its site or its capital stack. The redesign moves 44 units to the 50 percent tier, where net rents of $596, $711 and $811 clear the same market by 33 to 34 percent, and places 14 units at 70 percent and 14 at 80 percent priced at $775, $925 and $1,050, below market as the QAP requires of those tiers without a 10 percent test, for a weighted average of 59.7 percent that satisfies the average income set-aside. The redesigned Project reaches 1.20x coverage on a $2,193,000 permanent loan at a stabilized occupancy of 93 percent in Year 3, and its sources close at a $17,500,150 total development cost with an annual federal credit of $1,049,800, the matching Georgia state credit, and $399,990 of deferred developer fee. The determination is conditioned on three items: verification of the achievable market rents at the primary market area's comparable properties on their own websites, because the 60 percent failure and the redesign both rest on them; DCA's 2026 utility allowance schedule for Bibb County, which sets the net rents; and site control on an R-3 parcel inside the market area.

This is an MMCG model study: a complete LIHTC market study and feasibility analysis performed on a model site in a real market using public data, prepared to show developers, syndicators and lenders how MMCG tests a unit mix against a state allocating agency's thresholds before an application is filed, and why a project with deep demand can fail. The site is carried as a 6.0-acre portion of R-3 zoned land in the Gray Highway and Clinton Road corridor, where a 17.38-acre R-3 parcel is marketed, at an MMCG land basis; it is not a client engagement, MMCG has no relationship with any landowner or broker in the corridor, and the analysis does not represent an offer, an appraisal or a recommendation to buy any parcel. Figures drawn from HUD, DCA, the Census Bureau and property websites are identified as such. Figures labeled MMCG assumption are underwriting inputs set by MMCG, and items that could not be verified from a primary source at the study date are listed in the Conditions and Limitations section rather than estimated silently. In particular, the achievable market rents in the primary market area, the DCA utility allowance schedule, the renter household income distribution from the American Community Survey, and the existing LIHTC communities' rents and occupancy were not confirmed from primary sources at the study date and are carried as stated assumptions; the two Class A comparables whose rents were confirmed on their own websites lie outside the primary market area and are presented as such.

The Project will operate as a family housing credit community on a 6.0-acre R-3 site in the Gray Highway and Clinton Road corridor of east Macon, Macon-Bibb County, Georgia, inside a Qualified Census Tract. The physical program comprises four three-story wood-frame walk-up buildings over slab with brick and fiber cement veneer, holding 72 units in three plans: 12 one-bedroom units of 700 SF, 36 two-bedroom units of 950 SF and 24 three-bedroom units of 1,150 SF, for 70,200 SF of net rentable area and 80,000 SF gross, together with a single-story community building of 2,400 SF containing the leasing and management office, a community room with a kitchenette, a computer room and a laundry, a playground, a covered picnic pavilion and 126 surface parking spaces at 1.75 per unit. As redesigned, 44 units are restricted to households at or below 50 percent of area median income, 14 to 70 percent and 14 to 80 percent, under the average income set-aside election at a weighted average of 59.7 percent, with the land use restrictive covenant recorded for DCA's compliance period. The community will be managed by a DCA-experienced third-party fee manager at 6 percent of effective gross income, with an on-site staff of two full-time equivalents, a community manager and a maintenance technician, and the manager will certify household income at move-in and annually under DCA's compliance manual. The sponsor will hold the Project in a limited partnership with the tax credit investor as the limited partner, the sponsor's affiliate as general partner, and a Georgia nonprofit or the Macon-Bibb County Land Bank Authority as a special limited partner where the QAP's scoring rewards it. The Project is positioned as the newest family housing credit community in east Macon, with net rents at the 50 percent tier of $596, $711 and $811 and at the 70 and 80 percent tiers of $775, $925 and $1,050, each below the achievable market rent in the primary market area, and with no concession in lease-up because the 50 percent units lease from a waiting list.

Marketing and Sales Strategy

Pre-leasing begins four months before certificate of occupancy from the management office of an affiliated property and from a leasing trailer on the site, with the waiting list opened at the start of construction. The 50 percent tier is marketed through the Macon-Bibb County Housing Authority's referral channel, the Macon Housing Authority's voucher holders, the county's school district family resource centers, and the employer base of the Medical Center Navicent Health campus and the Robins Air Force Base contractor community whose entry-level workforce falls inside the band. The 70 and 80 percent tiers are marketed on the internet listing services as workforce units at rents below the market's newer stock, with the income screen stated. Retention runs through the compliance calendar and the 50 percent waiting list, which refills the restricted units at turnover without marketing cost.

Amenities

The model site is a 6.0-acre portion of R-3 zoned land in the Gray Highway and Clinton Road corridor of east Macon, carried at a land basis of $350,000 as an MMCG assumption. A 17.38-acre parcel at that intersection is marketed on Land.com as zoned R-3 Multifamily and in close proximity to several other multifamily developments, with about 500 feet of frontage on Clinton Road and more than 300 feet on Gray Highway; the subject is modeled as a portion of a parcel of that kind, and the asking price was not published. Macon-Bibb County is a consolidated city-county government of 157,556 residents on the Census Bureau's July 1, 2025 estimate, up 0.1 percent from the 2020 census, with a median household income of $51,234 over 2020 to 2024, 24.7 percent of persons in poverty, a renter share of 48.6 percent of occupied housing units and a median gross rent of $1,066. The renter median household income, on a secondary compilation of the American Community Survey, is about $31,244, which places the typical Macon renter above the income needed to afford the 50 percent tier's two-bedroom rent at 35 percent of income and defines the demand band for a housing credit community as the renters above the median, not below it.

East Macon is where the county's older rental stock, its Qualified Census Tracts and its housing authority properties are concentrated, and it is where DCA's 2024 award to the Macon Housing Authority's 64-unit Pleasant Hill Landing was made. A site there carries the Qualified Census Tract basis boost and scores under DCA's stable communities and revitalization categories, and it also sits in a primary market area whose achievable rents are set by the older stock rather than by the Class A communities on the county's northern and southern edges, which is the fact that decides this study.

Macon-Bibb County's R-3 Multifamily Residential district is designed, in the words of the Comprehensive Land Development Resolution as revised September 2, 2024, to provide sufficient areas for high density residential development with greater emphasis on multifamily uses, with a minimum lot of 7,500 square feet for any multifamily development. The Project's 12 units per acre with three-story buildings and surface parking is well inside the district's range, and the by-right use table was not retrieved at the study date, so the study carries a conditional use review as a contingency with a three-month schedule before the Macon-Bibb County Planning and Zoning Commission. DCA requires evidence of zoning at application, and the zoning letter is obtained before the May application deadline.

Water and sewer service is provided by the Macon Water Authority and the budget carries $260,000 for connections and the Authority's capacity fees as a stated allowance. Property tax is carried at $1,200 per unit in Year 1, $86,400, as an MMCG assumption that reflects Macon-Bibb's assessment of housing credit properties on the income approach with the restricted rents, and escalates 2 percent per year; the certified millage and the Board of Assessors' practice for housing credit properties should replace it before closing. Georgia does not exempt housing credit properties from ad valorem tax, and the budget carries the full line.

The subject's rents are set by HUD, not by the market. HUD's FY2026 Multifamily Tax Subsidy Project income limits for the Macon-Bibb County, GA HUD Metro FMR Area are effective May 1, 2026, with DCA requiring implementation by June 16, 2026. The area's median family income is $74,400, and the 50 percent limits for one through six persons are $26,950, $30,800, $34,650, $38,500, $41,600 and $44,700; the 60 percent limits are $32,340, $36,960, $41,580, $46,200, $49,920 and $53,640. The 80 percent limits are derived at $43,120, $49,280, $55,440, $61,600, $66,560 and $71,520. The limits are floor-driven: the four-person 50 percent limit of $38,500 exceeds half of the area's $74,400 median family income, and the same 50 percent row appears for a number of rural Georgia counties whose median incomes run from $56,500 to $68,500, which means Macon's housing credit rents are set against a statewide floor rather than against Macon's own income, and they land close to Macon's market rents as a result.

At 30 percent of income and one and a half persons per bedroom, the occupancy standard the DCA manual applies to family developments, the maximum gross rents are $721, $866 and $1,001 at 50 percent; $866, $1,039 and $1,201 at 60 percent; $1,010, $1,212 and $1,401 at 70 percent; and $1,155, $1,386 and $1,602 at 80 percent, for one-, two- and three-bedroom units respectively. DCA publishes its 2026 utility allowance schedules for its North and South regions, and the values were not retrieved at the study date; MMCG models allowances of $125, $155 and $190 for an all-electric walk-up with tenant-paid electric, water and sewer and owner-paid trash, which produce maximum net rents of $596, $711 and $811 at 50 percent, $741, $884 and $1,011 at 60 percent, $885, $1,057 and $1,211 at 70 percent, and $1,030, $1,231 and $1,412 at 80 percent. The DCA schedule and the North or South region assignment for Bibb County are the second condition precedent, because a schedule $30 higher than modeled reduces every net rent by $30 and every advantage by about three points.

DCA's 2026 Market Study Manual states the test in one sentence: rent advantage must be at least 10 percent for 60 percent AMI or lower designations, and 70 or 80 percent AMI rents must be below achievable market rent. The formula is the achievable market rent less the proposed rent, divided by the proposed rent, and market rent must be adjusted for concessions and for owner-paid utilities before the comparison is made. The achievable market rent is the market rent of comparable properties adjusted to the subject's features, and the manual requires the analysis to include every rental property within two miles of a metropolitan subject that is a true alternative, market-rate or rent-restricted.

MMCG's survey of the Macon market found two Class A communities whose rents could be confirmed on their own websites, both outside the subject's primary market area. Mill Creek Run, at 6687 Skipper Road in south Bibb near Interstate 75, publishes one-bedroom units at $1,140 to $1,551, two-bedroom units at $1,255 to $1,765 and three-bedroom units at $1,586 to $2,034, with two weeks free on applications by October 9, 2026; its builder describes it as a 224-unit community completed in April 2006. Lullwater at Bass, at 1644 Bass Road in north Macon, publishes one-bedroom units at $1,331 to $2,024 and two-bedroom units at $1,529 to $1,604, with three-bedroom units at $1,775 to $1,970 on an earlier capture, and no concession. Against those properties, concession-adjusted to $1,096, $1,207 and $1,525 at the lowest asking rents, the 60 percent net rents show advantages of 48, 36 and 51 percent and the proposal would pass comfortably. But a DCA analyst drawing a primary market area in east Macon would exclude them as not true alternatives: they are seven to ten miles from the site, on different corridors, at rents that the subject's renter pool cannot reach. The market area's own stock is the older garden and duplex product of east and central Macon, and the achievable rents MMCG models there, from the county's $1,066 median gross rent, the metro's $1,176 average asking rent across all vintages, and the condition and age of the comparable set, are $800 for a one-bedroom, $950 for a two-bedroom and $1,080 for a three-bedroom. Those figures are MMCG assumptions and the first condition precedent requires them to be replaced by rents confirmed on the comparables' own websites.

The break-even achievable rents at which the 60 percent tier would pass are $815, $972 and $1,112, each 10 percent above the proposed net rent. The determination turns on whether the primary market area's comparables, once verified, sit above or below those figures, and the study states that plainly rather than drawing the market area to reach a conclusion. The redesign passes by a margin that survives any plausible verification: the 50 percent tier clears even a market 17 percent below the modeled rents, and the 70 and 80 percent units are priced to sit just under whatever the verified market rent turns out to be.

DCA's capture rate is the subject's units divided by the income-qualified renter households in the primary market area, by tier and by bedroom, with the competing affordable pipeline in the numerator. The income band for each unit runs from the minimum income needed to afford the gross rent at 35 percent of income, DCA's affordability standard for family households, to the tier's income limit for the household size. For the 50 percent two-bedroom, the gross rent of $866 requires a minimum income of about $29,700 and the three-person limit is $34,650; for the 80 percent two-bedroom priced at $925 net, about $1,080 gross, the band runs from about $37,000 to the three-person limit of $55,440. MMCG estimates the primary market area at about 9,500 renter households and the income-qualified pool across the subject's tiers at about 1,900 households, which places the overall capture rate at about 3.8 percent against DCA's 30 percent cap for the Metro Pool, and the capture by bedroom within each tier well inside the 60 percent cap; the three-bedroom share of 33 percent is inside the 40 percent limit. The American Community Survey renter household income table for the market area was not retrieved at the study date and the pool is carried as an estimate to be replaced.

The existing affordable stock is inventoried because DCA disqualifies a market area in which more than two DCA-funded projects have physical occupancy below 90 percent, a screen on the competing stock that is distinct from the subject's own 93 percent stabilization standard. The study identifies the Macon Housing Authority's 2024 award, Pleasant Hill Landing, 64 family units with $1,350,000 of annual credits, 57 of them affordable and 13 reserved for voucher holders, as the newest competing housing credit community in east Macon, and Tattnall Place, 97 units, among the existing stock; their rents and occupancy were not confirmed at the study date. The 2024 bond allocations to the Housing Authority's redevelopment of Barton Village, Brightwood Lane, Greenwood Village and Marshall Lane are rehabilitation of public housing, not new competitive supply at the subject's tiers.

The Project opens in the third quarter of 2028 after a 14-month construction period and leases up at 8 units per month to 90 percent occupancy in about eight months, then to a stabilized 93 percent occupancy, the DCA standard, from the second quarter of 2029, inside the agency's 24-month maximum. The 50 percent units lease from the waiting list without concession; the 70 and 80 percent units carry a half-month concession on initial leases, 3 percent of gross potential rent in Year 1. Stabilized vacancy and collection loss is 7 percent, DCA's maximum, which is conservative for a 50 percent tier that rarely runs above 3 percent vacancy.

Other income, which comprises application fees, late fees and laundry, is carried at $35 per occupied unit per month. Rents escalate 2 percent per year, below the 3 percent MMCG applies to market-rate projects, because housing credit rents move with HUD's published limits rather than with the market. The Year 1 shortfall is funded from the operating reserve in the sources and uses.

Location: Model site, Gray Highway and Clinton Road corridor, Macon, GA Size in SF (Gross): 80,000

Source: Marshall & Swift CoreLogic, MMCG

Total development cost of $243,058 per unit is in the range of Georgia housing credit awards in recent rounds and below the $341,000 per unit average of MAA's 2026 market-rate pipeline; hard cost of $159 per square foot gross is a three-story walk-up figure for middle Georgia with the DCA architectural standards, universal design units and energy specifications the QAP requires. The developer fee of $2,500,000 is 14.3 percent of total development cost and inside DCA's limit, with $399,990 deferred. The operating reserve of six months of operating expenses and debt service, $380,000, is the DCA minimum and covers the Year 1 shortfall of $199,652 against debt service with a margin.

Sources and Uses and Loan Assumptions

The permanent loan is small by design. Housing credit communities at 50 percent of area median income carry little debt, and the equity does the work; the annual federal credit of $1,049,800, or $14,581 per low-income unit, sits below DCA's 2024 award to the 64-unit Pleasant Hill Landing, $1,350,000, which matters under the QAP's tiebreaker favoring applications that use the least credit per low-income unit. The as-proposed program at 60 percent would have carried a permanent loan of $3,029,000 and required $990,900 of annual credit, less than the redesign, which is the usual cost of moving units to the 50 percent tier and is paid in credits rather than in rent advantage.

The Project is a family housing credit application to DCA's 2026-2027 Qualified Allocation Plan, final December 8, 2025 and amended August 12, 2026, in the Metro Pool, with the 9 percent application deadline of May 15, 2026 for the 2026 round and the comparable 2027 deadline for the following round. The market study must be prepared by an analyst on DCA's approved list, dated no more than six months before the application, and conform to the National Council of Housing Market Analysts' standards; its stabilization standard is 93 percent occupancy, and a written explanation is required where vacancy and stabilization fall outside DCA's maximums of 7 percent and 24 months. The rent advantage test and its formula are stated above; the overall capture rate may not exceed 30 percent in the Metro Pool, capture by bedroom type within each income segment may not exceed 60 percent, three-bedroom units may not exceed 40 percent of the project and four-bedroom units 50 percent, and no more than two DCA-funded projects in the primary market area may have physical occupancy below 90 percent.

The redesign's weighted average of 59.7 percent satisfies the average income set-aside, and the 70 and 80 percent units are permitted at rents below achievable market rent without a 10 percent test. The Project claims the 130 percent basis boost on eligible basis as a Qualified Census Tract site and, where the QAP's stable communities category applies, under DCA's state boost; the 2026 Qualified Census Tract list for Bibb County was not retrieved at the study date and the boost is carried subject to it. The application scores under the tiebreakers for family projects with 20 percent or more three- and four-bedroom units, which the subject meets at 33 percent, and for the least credit per low-income unit. The analyst's certification affirms no interest in the project, no relationship with the ownership entity, and that compensation is not contingent on the project being funded; MMCG's fixed, delivery-based fee satisfies it.

The Year 3 operating budget at 93 percent occupancy is built by line for a Georgia housing credit community, with the compliance cost of annual recertification carried in the controllable line.

The expense ratio of 69.9 percent is the signature of a 50 percent tier: operating cost per unit of $6,861 is close to the IREM 2024 national figure of $7,981 for all multifamily, but the restricted rents produce revenue of $9,810 per unit, so the margin is 30 percent against the 55 to 60 percent a market-rate garden community earns. Insurance is carried at $900 per unit in Year 1, above the National Apartment Association's 2024 national average of $777, and escalates 5 percent per year; the management fee at 6 percent reflects a housing credit contract with compliance duties; the replacement reserve is carried at $300 per unit, DCA's minimum for new construction. Expenses escalate 3 percent against rents at 2 percent, which is why coverage drifts from 1.20x in Year 3 to 1.19x in Year 5 and why the permanent loan is sized small.

The Year 1 shortfall of $199,652 is funded from the operating reserve. The Project covers its debt from Year 2 at 1.16x and holds 1.19x to 1.20x through Year 5. The flat coverage profile is characteristic of a housing credit community whose rents are capped by HUD's limits and whose expenses are not, and it is the reason investors and DCA underwrite the fifteen-year compliance period rather than the first five years; the study's fifteen-year extension holds coverage above 1.10x through Year 12 on the same escalation assumptions.

At Year 3 rents, the community's fixed operating cost is $473,195 including the replacement reserve, and its variable cost is the management fee.

The operating break-even at 63.3 percent is high because the restricted rents are low against a fixed cost base, and the debt break-even at 88.5 percent sits five points under the forecast; that is the cushion a small permanent loan buys, and it is why the equity, not the debt, carries a housing credit community.

The redesigned Project holds coverage above 1.0x in every single-factor case except an 85 percent stabilized occupancy, which is not a plausible outcome for a 50 percent tier in a market with a waiting list but defines the downside the lender is accepting. The utility allowance case and the market rent case each cost eight to nine points of coverage and leave the determination intact; both are conditions precedent because they also move the rent advantage. The as-proposed case is the determination: at 60 percent across the board the Project would earn more revenue and cover a larger loan, and DCA would not score it.

The determination of not feasible as proposed and feasible as redesigned is subject to the following conditions precedent:

The following items could not be verified from a primary source at the study date and are disclosed: the achievable market rents in the primary market area; DCA's 2026 utility allowance values and the North or South region for Bibb County; a DCA-published 2026 maximum gross rent table for Macon-Bibb, in place of which MMCG calculated the rents from HUD's limits; HUD's published 80 percent limits for the area, which MMCG derived; the unit counts, rents and occupancy of Pleasant Hill Landing, Tattnall Place and the other housing credit communities in east Macon; the 2023 and 2025 DCA 9 percent awards in Macon-Bibb; the American Community Survey renter household income table for the market area; DCA's Metro Pool definition and the maximum credit per project in the 2026-2027 QAP; HUD's 2026 Qualified Census Tract list for Bibb County; the R-3 district's by-right use table; the certified Macon-Bibb millage and the Board of Assessors' practice for housing credit properties; and the unit count and year built of Lullwater at Bass.

This model study applies the methodology described on MMCG's multifamily feasibility study and LIHTC market study pages. MMCG prepares LIHTC market studies and feasibility studies to NCHMA standards and state QAP thresholds, and multifamily feasibility studies for HUD, USDA, agency and bank construction lenders nationwide, with engagements from $4,900 and delivery in 9 to 16 business days.