10-Q

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defaults on the mortgage loans securing our mortgage revenue bonds (“MRBs”) and governmental issuer loans (“GILs”);

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the competitive environment in which we operate;

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risks associated with investing in multifamily, student, senior citizen residential properties and commercial properties;

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general economic, geopolitical, and financial conditions, including the current and future impact of changing interest rates, inflation, international conflicts, and the novel coronavirus (“COVID-19”) on business operations, employment, and financial conditions;

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uncertain conditions within the domestic and international macroeconomic environment, including monetary and fiscal policy and conditions in the investment, credit, interest rate, and derivatives markets;

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adverse reactions in U.S. financial markets related to actions of foreign central banks or the economic performance of foreign economies, including in particular China, Japan, the European Union, and the United Kingdom;

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the general condition of the real estate markets in the regions in which we operate, which may be unfavorably impacted by increases in mortgage interest rates, slowing economic growth, persistent elevated inflation levels, and other factors;

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changes in interest rates and credit spreads, as well as the success of any hedging strategies we may undertake in relation to such changes, and the effect such changes may have on the relative spreads between the yield on our investments and our cost of financing;

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persistent inflationary trends, spurred by multiple factors including expansionary monetary and fiscal policy, high commodity prices, a tight labor market, and low residential vacancy rates, which may result in further interest rate increases and lead to increased market volatility;

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our ability to access debt and equity capital to finance our assets;

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current maturities of our financing arrangements and our ability to renew or refinance such financing arrangements;

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potential exercising of redemption rights by the holders of the Series A Preferred Units;

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local, regional, national and international economic and credit market conditions;

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recapture of previously issued Low Income Housing Tax Credits (“LIHTCs”) in accordance with Section 42 of the Internal Revenue Code (“IRC”);

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geographic concentration of properties related to our investments; and

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changes in the U.S. corporate tax code and other government regulations affecting our business.

1. Basis of Presentation

America First Multifamily Investors, L.P. (the “Partnership”) was formed on April 2, 1998, under the Delaware Revised Uniform Limited Partnership Act primarily for the purpose of acquiring, holding, selling and otherwise dealing with a portfolio of mortgage revenue bonds (“MRBs”) that have been issued to provide construction and/or permanent financing for affordable multifamily and student housing residential properties and commercial properties. The Partnership has also invested in governmental issuer loans (“GILs”), which are similar to MRBs, to provide construction financing for affordable multifamily properties. The Partnership expects and believes the interest earned on these MRBs and GILs is excludable from gross income for federal income tax purposes. The Partnership may also invest in other types of securities, including taxable MRBs and taxable GILs secured by real estate and may make property loans to multifamily residential properties which may or may not be financed by MRBs or GILs held by the Partnership and may or may not be secured by real estate.

The Partnership also makes noncontrolling equity investments in unconsolidated entities for the construction, stabilization, and ultimate sale of market-rate multifamily properties. The Partnership is entitled to distributions if, and when, cash is available for distribution either through operations, a refinance or a sale of the property. In addition, the Partnership may acquire and hold interests in multifamily, student and senior citizen residential properties (“MF Properties”) until the “highest and best use” can be determined by management.

The Partnership is governed by the First Amended and Restated Agreement of Limited Partnership dated September 15, 2015, as further amended (the “Partnership Agreement”). Mortgage investments, as defined in the Partnership Agreement, consist of MRBs, taxable MRBs, GILs, taxable GILs and property loans. The Partnership Agreement authorizes the Partnership to make investments in tax-exempt securities other than mortgage investments provided that the tax-exempt investments are rated in one of the four highest rating categories by a national securities rating agency. The Partnership Agreement also allows the Partnership to invest in other securities whose interest may be taxable for federal income tax purposes. Total tax-exempt investments and other investments cannot exceed 25% of the Partnership's total assets at the time of acquisition as required under the Partnership Agreement. Tax-exempt investments and other investments primarily consist of real estate assets and investments in unconsolidated entities. In addition, the amount of other investments is limited based on the conditions to the exemption from registration under the Investment Company Act of 1940.

The Partnership’s sole general partner is America First Capital Associates Limited Partnership Two (“AFCA 2” or “General Partner”). The general partner of AFCA 2 is Greystone AF Manager LLC (“Greystone Manager”), an affiliate of Greystone & Co. II LLC (collectively with its affiliates, “Greystone”).

The Partnership has issued Beneficial Unit Certificates (“BUCs”) representing assigned limited partnership interests to investors (“BUC holders”). The Partnership has designated three series of non-cumulative, non-voting, non-convertible preferred units (collectively, the “Preferred Units”) that represent limited partnership interests in the Partnership consisting of the Series A Preferred Units, the Series A-1 Preferred Units, and the Series B Preferred Units. The outstanding Series A Preferred Units and Series A-1 Preferred Units are redeemable in the future (Note 19). The Partnership had not yet issued Series B Preferred Units as of September 30, 2022. The holders of the BUCs and Preferred Units are referred to herein collectively as “Unitholders.”

2. Summary of Significant Accounting Policies

Consolidation

The “Partnership,” as used herein, includes America First Multifamily Investors, L.P., its consolidated subsidiaries and consolidated variable interest entities (Note 5). All intercompany transactions are eliminated. The consolidated subsidiaries of the Partnership for the periods presented consist of:

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ATAX TEBS I, LLC, a special purpose entity owned and controlled by the Partnership, created to hold MRBs to facilitate the M24 Tax Exempt Bond Securitization (“TEBS”) Financing (“M24 TEBS Financing”) with the Federal Home Loan Mortgage Corporation (“Freddie Mac”);

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ATAX TEBS II, LLC, a special purpose entity owned and controlled by the Partnership, created to hold MRBs to facilitate the “M31 TEBS Financing” with Freddie Mac;

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ATAX TEBS III, LLC, a special purpose entity owned and controlled by the Partnership, created to hold MRBs to facilitate the “M33 TEBS Financing” with Freddie Mac;

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ATAX TEBS IV, LLC, a special purpose entity owned and controlled by the Partnership, created to hold MRBs to facilitate the “M45 TEBS Financing” with Freddie Mac;

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ATAX TEBS Holdings, LLC, a wholly owned subsidiary of the Partnership, which has issued secured notes (“the Secured Notes”) to Mizuho Capital Markets LLC (“Mizuho”);

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ATAX Vantage Holdings, LLC, a wholly owned subsidiary of the Partnership, which is committed to loan money or provide equity for the development of market-rate multifamily properties;

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One wholly owned corporation (the "Greens Hold Co”), which owns 100% of The 50/50 MF Property, a real estate asset, and certain property loans; and

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Lindo Paseo LLC, a wholly owned limited liability company, which owns 100% of the Suites on Paseo MF Property.

The Partnership also consolidates variable interest entities (“VIEs”) in which the Partnership is deemed to be the primary beneficiary.

Impairment of Mortgage Revenue Bonds and Taxable Mortgage Revenue Bonds

The Partnership accounts for its investments in MRBs and taxable MRBs under the accounting guidance for certain investments in debt and equity securities. The Partnership's investments in these instruments are classified as available-for-sale debt securities and are reported at their estimated fair value. The net unrealized gains or losses on these investments are reflected on the Partnership's condensed consolidated statements of comprehensive income. Unrealized gains and losses do not affect the cash flow of the bonds, distributions to Unitholders, or the characterization of the interest income of the financial obligation of the underlying collateral. See Note 22 for a description of the Partnership's methodology for estimating the fair value of MRBs and taxable MRBs.

The Partnership periodically reviews its MRBs and taxable MRBs for impairment. The Partnership evaluates whether unrealized losses are considered other-than-temporary impairments based on various factors including, but not necessarily limited to, the following:

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The duration and severity of the decline in fair value;

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The Partnership’s intent to hold and the likelihood of it being required to sell the security before its value recovers;

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Adverse conditions specifically related to the security, its collateral, or both;

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Volatility of the fair value of the security;

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The likelihood of the borrower being able to make scheduled interest and principal payments;

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Failure of the issuer to make scheduled interest or principal payments; and

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Recoveries or additional declines in fair value after the balance sheet date.

While the Partnership evaluates all available information, it focuses specifically on whether the security’s estimated fair value is below amortized cost. If a MRB’s estimated fair value is below amortized cost, and the Partnership has the intent to sell or may be required to sell the MRB prior to the time that its value recovers or until maturity, the Partnership will record an other-than-temporary impairment through earnings equal to the difference between the MRB’s carrying value and its fair value. If the Partnership does not expect to sell an other-than-temporarily impaired MRB, only the portion of the other-than-temporary impairment related to credit losses is recognized through earnings as a provision for credit loss, with the remainder recognized as a component of other comprehensive income. In determining the provision for credit loss, the Partnership compares the present value of cash flows expected to be collected to the MRB’s amortized cost basis.

The recognition of other-than-temporary impairment, provision for credit loss, and the potential impairment analysis are subject to a considerable degree of judgment, the results of which, when applied under different conditions or assumptions, could have a material impact to the condensed consolidated financial statements. If the Partnership experiences deterioration in the values of its MRB portfolio, the Partnership may incur other-than-temporary impairments or provision for credit losses that could negatively impact the Partnership’s financial condition, cash flows, and reported earnings.

Estimates and assumptions

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America (“GAAP”) requires the Partnership to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The accompanying interim unaudited condensed consolidated financial statements have been prepared in accordance with the rules and regulations of the Securities and Exchange Commission (“SEC”). Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been condensed or omitted in accordance with such SEC rules and regulations, although the Partnership believes that the disclosures are adequate to make the information presented not misleading.

The Partnership’s condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in the Partnership’s Annual Report on Form 10-K for the year ended December 31, 2021. These condensed consolidated financial statements and notes have been prepared consistently with the 2021 Form 10-K. In the opinion of management, all adjustments (consisting of normal and recurring accruals) necessary to present fairly the Partnership’s financial position as of September 30, 2022, and the results of operations for the interim periods presented, have been made. The results of operations for the interim periods are not necessarily indicative of the results to be expected for the full year. The accompanying condensed consolidated balance sheet as of December 31, 2021 was derived from the audited annual consolidated financial statements but does not contain all the footnote disclosures from the annual consolidated financial statements.

Risks and Uncertainties

Through November 2, 2022, the Federal Reserve announced six increases in short-term interest rates totaling 375 basis points. The Federal Reserve has signaled further future short-term interest rate increases to combat inflation in the broader economy. In addition, geopolitical conflicts continue to impact the general global economic environment. These factors have caused volatility in the fixed income markets, which has impacted the value of some of the Partnership’s investment assets, particularly fixed-rate MRBs and taxable MRBs. In addition, increases in short-term interest rates will generally result in increases in the interest cost associated with the Partnership’s variable rate debt financing arrangements and for construction debt of properties underlying our investments in unconsolidated entities. The extent to which general economic, geopolitical, and financial conditions will impact the Partnership’s financial condition or results of operations in the future is uncertain and actual results and outcomes could differ from current estimates.

The current inflationary environment in the United States may increase operating expenses at properties securing the Partnership’s investments and general operations. Regarding investments, such increases may reduce net operating results of the related properties and result in lower debt service coverage or higher than anticipated capitalized interest requirements for properties under construction. Such occurrences may negatively impact the value of the Partnership’s investments. Higher general and administrative expenses and real estate operating expenses may adversely affect the Partnership’s operating results, including a reduction in net income.

Beneficial Unit Certificates (“BUCs”)

The Partnership has issued BUCs representing assigned limited partnership interests to investors. Costs related to the issuance of BUCs are recorded as a reduction to partners’ capital when issued. On April 1, 2022, the Partnership effected a one-for-three reverse unit split (“Reverse Unit Split”) of its outstanding BUCs. As a result of the Reverse Unit Split, holders of BUCs received one BUC for every three BUCs owned at the close of business on April 1, 2022. All fractional BUCs created by the Reverse Unit Split were rounded to the nearest whole BUC, with any fraction equal to or above 0.5 BUC rounded up to the next higher BUC, as provided by the Partnership Agreement. Immediately prior to the Reverse Unit Split, there were 66,049,908 BUCs issued and outstanding, and immediately after the Reverse Unit Split the number of issued and outstanding BUCs decreased to 22,017,915. In connection with the Reverse Unit Split, the CUSIP number for the BUCs changed to 02364V 206. The BUCs continue to trade on the Nasdaq Global Select Market under the trading symbol “ATAX.”

On September 14, 2022, the Partnership declared a supplemental distribution payable in the form of additional BUCs equal to $0.20 per BUC (the “BUCs Distribution”). The BUCs Distribution was paid at a ratio of 0.01044 BUCs for each issued and outstanding BUC as of the record date of September 30, 2022, which represents an amount per BUC based on the closing price of the BUCs on the Nasdaq Stock Market LLC on September 13, 2022. The BUCs Distribution was completed on October 31, 2022. There were no fractional BUCs issued in connection with the BUCs Distribution. All fractional BUCs resulting from the BUCs Distribution received cash for such fraction based on the market value of the BUCs on the record date.

The one-for-three Reverse Unit Split and the BUCs Distribution have been applied retroactively to all net income per BUC, distributions per BUC and similar per BUC disclosures for all periods indicated in the Partnership’s condensed consolidated financial statements.

Restricted Unit Awards (“RUA” or “RUAs”)

The Partnership’s 2015 Equity Incentive Plan (the “Plan”), as approved by the BUC holders in September 2015, permits the grant of RUAs and other awards to the employees of Greystone Manager, or any affiliate, who performs services for Greystone Manager, the Partnership or an affiliate, and members of Greystone Manager’s Board of Managers. The Plan permits total grants of RUAs of up to 1.0 million BUCs, which reflects adjustments made to the number of BUCs that may be granted under the Plan as a result of the Reverse Unit Split.

RUAs have historically been granted with vesting conditions ranging from three months to up to three years. RUAs typically provide for the payment of distributions during the restriction period. The RUAs provide for accelerated vesting if there is a change in control, or upon death or disability of the participant. The Partnership accounts for forfeitures as they occur. Outstanding RUAs were adjusted on a one-for-three basis in conjunction with the Reverse Unit Split effected on April 1, 2022. The number of outstanding RUAs was not impacted by the BUCs Distribution as holders of RUAs did not participate in the BUCs Distribution, but rather received cash in satisfaction of the previously announced supplemental distribution in the amount of $0.20 per RUA. The fair value of each RUA is estimated on the grant date based on the Partnership’s exchange-listed closing price of the BUCs. The Partnership recognizes compensation expense for the RUAs on a straight-line basis over the requisite vesting period. The Partnership accounts for modifications to RUAs as they occur, if the fair value of the RUAs change, there are changes to vesting conditions or the awards no longer qualify for equity classification.

Recently Issued Accounting Pronouncements

In June 2016, the Financial Accounting Standards Board (“FASB”) issued Accounting Standards Update (“ASU”) 2016-13, “Financial Instruments – Credit Losses (Topic 326).” ASU 2016-13 enhances the methodology of measuring expected credit losses for financial assets to include the use of reasonable and supportable forward-looking information to better estimate credit losses. In general, the allowance for credit losses is expected to increase when changing from an incurred loss to expected loss methodology. ASU 2016-13 also includes changes to the impairment model for available-for-sale debt securities such as the Partnership’s MRBs and taxable MRBs. ASU 2016-13 is effective for the Partnership on January 1, 2023 and is to be adopted through a cumulative-effect adjustment to retained earnings as of that date. The Partnership regularly assesses its assets that are within the scope of ASU 2016-13 and has determined that the GILs, taxable GIL, property loans, receivables reported within other assets, financial guaranties, financial commitments, and interest receivable related to such assets, are within the scope of ASU 2016-13. The Partnership anticipates utilizing a loss rate model based on the weighted average remaining maturity of items within the scope of ASU 2016-13. The Partnership continues to develop and refine data collection processes, assessment procedures and internal controls that will be required when ASU 2016-13 becomes effective, and to evaluate the impact to the Partnership's condensed consolidated financial statements.

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform—Facilitation of the Effects of Reference Rate Reform on Financial Reporting (“ASU 2020-04”), which provides optional guidance for a limited period meant to ease the potential burden in accounting for, or recognizing the effects of, reform to LIBOR and certain other reference rates. The standard is effective for all entities from March 12, 2020 through December 31, 2022. ASU 2020-04 is only applicable to contracts, hedging relationships, and other transactions that reference LIBOR or another reference rate expected to be discontinued because of reference rate reform, and that were entered into or evaluated prior to January 1, 2023. The Partnership has evaluated its population of instruments indexed, either directly or indirectly, to LIBOR and does not currently expect the adoption of ASU 2020-04 to have a material impact on the Partnership's condensed consolidated financial statements.

3. Partnership Income, Expenses and Cash Distributions

The Partnership Agreement contains provisions for the distribution of Net Interest Income, Net Residual Proceeds and Liquidation Proceeds, for the allocation of income or loss from operations, and for the allocation of income and loss arising from a repayment, sale, or liquidation of investments. Income and losses will be allocated to each Unitholder on a periodic basis, as determined by the General Partner, based on the number of Preferred Units and BUCs held by each Unitholder as of the last day of the period for which such allocation is to be made. Distributions of Net Interest Income and Net Residual Proceeds will be made to each Unitholder of record on the last day of each distribution period based on the number of Preferred Units and BUCs held by each Unitholder on that date. Cash distributions are currently made on a quarterly basis.

For purposes of the Partnership Agreement, income and cash received by the Partnership from its investments in MF Properties, investments in unconsolidated entities, and property loans will be included in the Partnership’s Net Interest Income, and cash distributions received by the Partnership from the sale or redemption of such investments will be included in the Partnership’s Net Residual Proceeds.

The holders of the Preferred Units are entitled to distributions at a fixed rate per annum prior to payment of distributions to other Unitholders.

Net Interest Income (Tier 1) is allocated 99% to the limited partners and BUC holders as a class and 1% to the General Partner. Net Interest Income (Tier 2) and Net Residual Proceeds (Tier 2) are allocated 75% to the limited partners and BUC holders as a class and 25% to the General Partner. Net Interest Income (Tier 2) and Net Residual Proceeds (Tier 2) in excess of the maximum allowable amount as set forth in the Partnership Agreement are considered Net Interest Income (Tier 3) and Net Residual Proceeds (Tier 3) and are allocated 100% to the limited partners and BUC holders as a class.

4. Net income per BUC

The Partnership has disclosed basic and diluted net income per BUC in the Partnership's condensed consolidated statements of operations. The unvested RUAs issued under the Plan are considered participating securities and are potentially dilutive. There were no dilutive BUCs for the three and nine months ended September 30, 2022 and 2021.

5. Variable Interest Entities

Consolidated Variable Interest Entities (“VIEs”)

The Partnership has determined the Tender Option Bond (“TOB”), Term TOB and TEBS financings are VIEs where the Partnership is the primary beneficiary. In determining the primary beneficiary of each VIE, the Partnership considered which party has the power to control the activities of the VIE which most significantly impact its financial performance, the risks that the entity was designed to create, and how each risk affects the VIE. The agreements related to the TOB, Term TOB and TEBS financings stipulate the Partnership has the sole right to cause the trusts to sell the underlying assets. If the underlying assets were sold, the extent to which the VIEs will be exposed to gains or losses would result from decisions made by the Partnership.

As the primary beneficiary, the Partnership reports the TOB, Term TOB and TEBS financings on a consolidated basis. The Partnership reports the Floater Certificates related to the TOB trust financings, and the Class A Certificates related to the Term TOB and TEBS financings as secured debt financings on the Partnership's condensed consolidated balance sheets (Note 15). The MRBs, GILs, property loans, taxable MRBs and taxable GIL securing the TOB, Term TOB and TEBS financings, are reported as assets on the Partnership's condensed consolidated balance sheets (Notes 6, 7, 10 and 12).

The Partnership has determined its investment in Vantage at San Marcos is a VIE where the Partnership is the primary beneficiary. The Partnership may currently require the managing member of the VIE to purchase the Partnership’s equity investment in the VIE at a price equal to the Partnership’s carrying value. If the Partnership were to redeem its investment, the underlying assets of the property would likely need to be sold. If the underlying assets were sold, the extent to which the VIE will be exposed to gains or losses would result from decisions made by the Partnership. The Partnership’s option to redeem its investment in Vantage at San Marcos was effective beginning in the fourth quarter of 2021. As the primary beneficiary, the Partnership reports the assets and liabilities of Vantage at San Marcos on a consolidated basis, which consist of a real estate asset investment (Note 8), mortgage payable (Note 16), and current liabilities associated with the construction costs of a market-rate multifamily property (Note 13). If certain events occur in the future, the Partnership’s option to redeem the investment will terminate and the VIE may be deconsolidated.

During 2021, the Partnership consolidated Vantage at Hutto and Vantage at Fair Oaks because it could require the managing member of the VIEs to purchase the Partnership's equity investments in the VIEs at a price equal to the Partnership's carrying value. The Partnership's right to require the managing members of the VIEs to purchase the Partnership's equity investments at a price equal to the Partnership's carrying values was terminated during 2021 upon construction commencement. As such, the Partnership was no longer the primary beneficiary of the VIEs and the VIEs were not reported on a consolidated basis and were instead reported as investments in unconsolidated entities as of December 31, 2021.

Non-Consolidated VIEs

The Partnership has variable interests in various entities in the form of MRBs, taxable MRBs, GILs, taxable GILs, property loans and investments in unconsolidated entities. These variable interests do not allow the Partnership to direct the activities that most significantly impact the economic performance of such VIEs. As a result, the Partnership is not considered the primary beneficiary and does not consolidate the financial statements of these VIEs in the Partnership's condensed consolidated financial statements.

The Partnership held variable interests in 31 and 30 non-consolidated VIEs as of September 30, 2022 and December 31, 2021, respectively. The following table summarizes the Partnership’s maximum exposure to loss associated with its variable interests as of September 30, 2022 and December 31, 2021:


	Maximum Exposure to Loss
	September 30, 2022		December 31, 2021
Mortgage revenue bonds	$	48,557,708	$	51,045,000
Taxable mortgage revenue bonds		2,000,000		2,000,000
Governmental issuer loans		281,275,255		184,767,450
Taxable governmental issuer loans		4,000,000		1,000,000
Property loans		122,563,896		47,274,576
Investments in unconsolidated entities		103,103,246		107,793,522
	$	561,500,105	$	393,880,548

The Partnership’s maximum exposure to loss for the MRBs and taxable MRBs as of September 30, 2022 is equal to the Partnership’s cost adjusted for paydowns. The difference between an MRB’s carrying value in the Partnership's condensed consolidated balance sheets and the maximum exposure to loss is a function of the unrealized gains or losses. The Partnership has future MRB and taxable MRB funding commitments related to non-consolidated VIEs totaling $47.0 million and $23.5 million, respectively, as of September 30, 2022 (Note 18).

The Partnership’s maximum exposure to loss for the GILs, taxable GILs, property loans and investments in unconsolidated entities as of September 30, 2022 is equal to the Partnership’s carrying value. The Partnership has future GIL, taxable GIL, property loan and investment in unconsolidated entities funding commitments related to non-consolidated VIEs totaling $122.8 million, $63.2 million, $64.1 million, and $8.9 million, respectively, as of September 30, 2022 (Note 18).

6. Mortgage Revenue Bonds

The Partnership’s MRBs provide construction and/or permanent financing for income-producing multifamily rental properties and a commercial property. MRBs are either held directly by the Partnership or are held in trusts created in connection with debt financing transactions (Note 15). The MRBs bear interest at a fixed rate, with the exception of Ocotillo Springs - Series A and Residency at the Mayer - Series A. The Partnership had the following investments in MRBs as of September 30, 2022 and December 31, 2021:


	September 30, 2022
Description of Mortgage Revenue Bonds Held in Trust	State	Cost Adjusted for Paydowns and Allowances		Cumulative Unrealized Gain		Cumulative Unrealized Loss			Estimated Fair Value
Courtyard - Series A (4)	CA	$	9,898,954	$	389,990	$	-		$	10,288,944
Glenview Apartments - Series A (3)	CA		4,386,923		221,254		-			4,608,177
Harmony Court Bakersfield - Series A (4)	CA		3,609,296		118,091		-			3,727,387
Harmony Terrace - Series A (4)	CA		6,682,143		329,629		-			7,011,772
Harden Ranch - Series A (2)	CA		6,472,099		452,521		-			6,924,620
Las Palmas II - Series A (4)	CA		1,637,465		70,328		-			1,707,793
Lutheran Gardens (6)	CA		10,352,000		63,494		-			10,415,494
Montclair Apartments - Series A (3)	CA		2,376,641		130,702		-			2,507,343
Montecito at Williams Ranch Apartments - Series A (6)	CA		7,522,733		627,722		-			8,150,455
Montevista - Series A (6)	CA		6,667,855		565,132		-			7,232,987
Ocotillo Springs - Series A (6), (8)	CA		11,090,000		-		(487,801	)		10,602,199
Residency at the Entrepreneur J-1 (6)	CA		9,088,500		172,857		-			9,261,357
Residency at the Entrepreneur J-2 (6)	CA		7,500,000		217,798		-			7,717,798
Residency at the Entrepreneur J-3 (7)	CA		-		656,481		-			656,481
Residency at the Mayer - Series A (6)	CA		25,069,208		-		-			25,069,208
San Vicente - Series A (4)	CA		3,376,366		111,397		-			3,487,763
Santa Fe Apartments - Series A (3)	CA		2,879,212		145,213		-			3,024,425
Seasons at Simi Valley - Series A (4)	CA		4,150,500		384,743		-			4,535,243
Seasons Lakewood - Series A (4)	CA		7,117,935		351,126		-			7,469,061
Seasons San Juan Capistrano - Series A (4)	CA		11,984,278		591,182		-			12,575,460
Summerhill - Series A (4)	CA		6,215,150		80,688		-			6,295,838
Sycamore Walk - Series A (4)	CA		3,440,619		130,469		-			3,571,088
The Village at Madera - Series A (4)	CA		2,985,168		137,695		-			3,122,863
Tyler Park Townhomes - Series A (2)	CA		5,635,996		231,647		-			5,867,643
Vineyard Gardens - Series A (6)	CA		3,916,109		312,891		-			4,229,000
Westside Village Market - Series A (2)	CA		3,683,114		193,646		-			3,876,760
Brookstone (1)	IL		7,298,854		1,232,165		-			8,531,019
Copper Gate Apartments (2)	IN		4,900,000		135,868		-			5,035,868
Renaissance - Series A (3)	LA		10,622,933		447,502		-			11,070,435
Live 929 Apartments - Series 2022A (6)	MD		58,050,821		798,344		-			58,849,165
Jackson Manor Apartments (6)	MS		6,900,000		-		-			6,900,000
Greens Property - Series A (2)	NC		7,629,000		536		-			7,629,536
Silver Moon - Series A (3)	NM		7,575,818		609,702		-			8,185,520
Village at Avalon (5)	NM		15,974,957		863,641		-			16,838,598
Columbia Gardens (4)	SC		12,588,742		428,517		-			13,017,259
Companion at Thornhill Apartments (4)	SC		10,821,542		448,643		-			11,270,185
The Palms at Premier Park Apartments (2)	SC		18,200,634		643,425		-			18,844,059
Village at River's Edge (4)	SC		9,669,777		44,189		-			9,713,966
Willow Run (4)	SC		12,414,487		477,489		-			12,891,976
Arbors at Hickory Ridge (2)	TN		10,633,673		1,699,911		-			12,333,584
Avistar at Copperfield - Series A (6)	TX		13,569,835		481,953		-			14,051,788
Avistar at the Crest - Series A (2)	TX		8,928,536		591,677		-			9,520,213
Avistar at the Oaks - Series A (2)	TX		7,221,895		432,723		-			7,654,618
Avistar at the Parkway - Series A (3)	TX		12,468,173		682,039		-			13,150,212
Avistar at Wilcrest - Series A (6)	TX		5,142,693		4,874		-			5,147,567
Avistar at Wood Hollow - Series A (6)	TX		39,048,349		1,386,861		-			40,435,210
Avistar in 09 - Series A (2)	TX		6,235,826		295,681		-			6,531,507
Avistar on the Boulevard - Series A (2)	TX		15,210,725		824,271		-			16,034,996
Avistar on the Hills - Series A (2)	TX		4,944,271		327,489		-			5,271,760
Bruton Apartments (4), (8)	TX		17,419,883		-		(533,140	)		16,886,743
Concord at Gulfgate - Series A (4)	TX		18,456,524		1,239,586		-			19,696,110
Concord at Little York - Series A (4)	TX		12,929,668		909,327		-			13,838,995
Concord at Williamcrest - Series A (4)	TX		20,029,441		1,156,304		-			21,185,745
Crossing at 1415 - Series A (4)	TX		7,191,959		353,742		-			7,545,701
Decatur Angle (4), (8)	TX		21,919,796		-		(834,292	)		21,085,504
Esperanza at Palo Alto (4)	TX		18,955,815		1,118,258		-			20,074,073
Heights at 515 - Series A (4)	TX		6,584,362		343,057		-			6,927,419
Heritage Square - Series A (3)	TX		10,358,615		432,270		-			10,790,885
Oaks at Georgetown - Series A (4)	TX		11,940,699		311,811		-			12,252,510
Runnymede (1)	TX		9,605,000		439		-			9,605,439
Southpark (1)	TX		11,419,072		1,297,785		-			12,716,857
15 West Apartments (4)	WA		9,474,154		979,184		-			10,453,338
Mortgage revenue bonds held in trust		$	650,074,793	$	27,685,959	$	(1,855,233	)	$	675,905,519

(1)

MRBs owned by ATAX TEBS I, LLC (M24 TEBS), Note 15

(2)

MRBs owned by ATAX TEBS II, LLC (M31 TEBS), Note 15

(3)

MRBs owned by ATAX TEBS III, LLC (M33 TEBS), Note 15

(4)

MRBs owned by ATAX TEBS IV, LLC (M45 TEBS), Note 15

(5)

MRB held by Morgan Stanley in a debt financing transaction, Note 15

(6)

MRBs held by Mizuho Capital Markets, LLC in a debt financing transaction, Note 15

(7)

The Partnership has an MRB funding commitment of $26.1 million as of September 30, 2022. The unfunded MRB commitment is accounted for as an available-for-sale security and reported at fair value. The reported unrealized loss is based on the fair value of the funding commitment outstanding as of September 30, 2022. The Partnership will partially fund the commitment with proceeds from a debt financing transaction with Mizuho Capital Markets, LLC.

(8)

As of the date presented, the MRB had been in a cumulative unrealized loss position for less than 12 consecutive months and is not considered a credit loss. The Partnership determined the unrealized loss is a result of increasing market interest rates and is not considered other-than-temporary.


	September 30, 2022
Description of Mortgage Revenue Bonds held by the Partnership	State	Cost Adjusted for Paydowns and Allowances		Cumulative Unrealized Gain		Cumulative Unrealized Loss			Estimated Fair Value
CCBA Senior Garden Apartments (1)	CA	$	3,801,312	$	-	$	(209,129	)	$	3,592,183
Solano Vista - Series A	CA		2,635,798		152,712		-			2,788,510
Meadow Valley (2)	MI		1,833,437		-		(2,632,998	)		(799,561	)
Gateway Village	NC		2,590,992		-		-			2,590,992
Greens Property - Series B	NC		916,502		114		-			916,616
Lynnhaven Apartments	NC		3,438,048		-		-			3,438,048
Provision Center 2014-1	TN		4,296,204		-		-			4,296,204
Avistar at the Crest - Series B	TX		726,263		28,394		-			754,657
Avistar at the Oaks - Series B	TX		531,895		14,208		-			546,103
Avistar at the Parkway - Series B	TX		123,287		20,319		-			143,606
Avistar in 09 - Series B	TX		438,765		11,720		-			450,485
Avistar on the Boulevard - Series B	TX		431,548		14,520		-			446,068
Mortgage revenue bonds held by the Partnership		$	21,764,051	$	241,987	$	(2,842,127	)	$	19,163,911

(1)

(2)

The Partnership has a remaining MRB funding commitment of $42.3 million as of September 30, 2022. The MRB and the unfunded MRB commitment are accounted for as available-for-sale securities and reported at fair value. The reported unrealized loss includes the unrealized loss on the current MRB carrying value (based on current fair value) as well as the unrealized loss on the Partnership’s remaining $42.3 million funding commitment outstanding as of September 30, 2022 (also based on current fair value). The Partnership determined the unrealized loss is a result of increasing market interest rates and that the cumulative unrealized loss is not other-than-temporary.


	December 31, 2021
Description of Mortgage Revenue Bonds Held in Trust	State	Cost Adjusted for Paydowns and Allowances		Cumulative Unrealized Gain		Cumulative Unrealized Loss		Estimated Fair Value
Courtyard - Series A (4)	CA	$	9,970,209	$	2,060,480	$	-	$	12,030,689
Glenview Apartments - Series A (3)	CA		4,429,350		863,955		-		5,293,305
Harmony Court Bakersfield - Series A (4)	CA		3,635,277		720,308		-		4,355,585
Harmony Terrace - Series A (4)	CA		6,730,004		1,425,757		-		8,155,761
Harden Ranch - Series A (2)	CA		6,538,111		1,285,747		-		7,823,858
Las Palmas II - Series A (4)	CA		1,649,370		332,704		-		1,982,074
Montclair Apartments - Series A (3)	CA		2,399,626		446,912		-		2,846,538
Montecito at Williams Ranch Apartments - Series A (6)	CA		7,568,334		1,983,454		-		9,551,788
Montevista - Series A (6)	CA		6,701,776		2,114,978		-		8,816,754
Ocotillo Springs - Series A (6)	CA		15,000,000		271,172		-		15,271,172
Residency at the Mayer - Series A (6)	CA		24,000,000		-		-		24,000,000
San Vicente - Series A (4)	CA		3,400,913		671,681		-		4,072,594
Santa Fe Apartments - Series A (3)	CA		2,907,057		567,028		-		3,474,085
Seasons at Simi Valley - Series A (4)	CA		4,188,582		1,011,623		-		5,200,205
Seasons Lakewood - Series A (4)	CA		7,168,917		1,518,742		-		8,687,659
Seasons San Juan Capistrano - Series A (4)	CA		12,070,116		2,557,065		-		14,627,181
Summerhill - Series A (4)	CA		6,259,888		1,187,464		-		7,447,352
Sycamore Walk - Series A (4)	CA		3,474,617		696,090		-		4,170,707
The Village at Madera - Series A (4)	CA		3,006,656		621,367		-		3,628,023
Tyler Park Townhomes - Series A (2)	CA		5,694,168		691,137		-		6,385,305
Vineyard Gardens - Series A (6)	CA		3,939,476		987,782		-		4,927,258
Westside Village Market - Series A (2)	CA		3,721,129		701,915		-		4,423,044
Brookstone (1)	IL		7,334,161		1,903,086		-		9,237,247
Copper Gate Apartments (2)	IN		4,900,000		433,436		-		5,333,436
Renaissance - Series A (3)	LA		10,732,295		4,172,381		-		14,904,676
Live 929 Apartments - 2014 Series A (6)	MD		36,169,147		573,155		-		36,742,302
Jackson Manor Apartments (6)	MS		4,900,000		-		-		4,900,000
Gateway Village (6)	NC		2,600,000		90,861		-		2,690,861
Greens Property - Series A (2)	NC		7,719,000		281,953		-		8,000,953
Lynnhaven Apartments (6)	NC		3,450,000		115,328		-		3,565,328
Silver Moon - Series A (3)	NM		7,629,704		1,868,323		-		9,498,027
Village at Avalon (5)	NM		16,069,382		4,124,498		-		20,193,880
Ohio Properties - Series A (1)	OH		13,580,000		-		-		13,580,000
Bridle Ridge (1)	SC		7,145,000		-		-		7,145,000
Columbia Gardens (4)	SC		12,725,440		2,003,599		-		14,729,039
Companion at Thornhill Apartments (4)	SC		10,924,609		1,793,226		-		12,717,835
Cross Creek (1)	SC		6,120,285		1,845,064		-		7,965,349
The Palms at Premier Park Apartments (2)	SC		18,385,572		2,181,632		-		20,567,204
Village at River's Edge (4)	SC		9,728,355		2,370,569		-		12,098,924
Willow Run (4)	SC		12,549,146		1,974,479		-		14,523,625
Arbors at Hickory Ridge (2)	TN		10,755,889		3,598,292		-		14,354,181
Avistar at Copperfield - Series A (6)	TX		13,678,286		2,549,711		-		16,227,997
Avistar at the Crest - Series A (2)	TX		9,022,172		1,926,825		-		10,948,997
Avistar at the Oaks - Series A (2)	TX		7,295,334		1,578,333		-		8,873,667
Avistar at the Parkway - Series A (3)	TX		12,579,783		2,353,247		-		14,933,030
Avistar at Wilcrest - Series A (6)	TX		5,183,794		772,242		-		5,956,036
Avistar at Wood Hollow - Series A (6)	TX		39,360,426		7,200,790		-		46,561,216
Avistar in 09 - Series A (2)	TX		6,299,237		1,288,060		-		7,587,297
Avistar on the Boulevard - Series A (2)	TX		15,370,243		3,165,575		-		18,535,818
Avistar on the Hills - Series A (2)	TX		4,994,549		1,100,478		-		6,095,027
Bruton Apartments (4)	TX		17,532,185		4,452,765		-		21,984,950
Concord at Gulfgate - Series A (4)	TX		18,606,719		4,211,979		-		22,818,698
Concord at Little York - Series A (4)	TX		13,034,887		3,055,517		-		16,090,404
Concord at Williamcrest - Series A (4)	TX		20,192,436		4,651,973		-		24,844,409
Crossing at 1415 - Series A (4)	TX		7,253,698		1,549,224		-		8,802,922
Decatur Angle (4)	TX		22,074,594		4,731,759		-		26,806,353
Esperanza at Palo Alto (4)	TX		19,071,622		5,317,911		-		24,389,533
Heights at 515 - Series A (4)	TX		6,640,885		1,418,341		-		8,059,226
Heritage Square - Series A (3)	TX		10,455,924		1,823,426		-		12,279,350
Oaks at Georgetown - Series A (4)	TX		12,026,225		2,181,690		-		14,207,915
Runnymede (1)	TX		9,675,000		99,489		-		9,774,489
Southpark (1)	TX		11,365,100		1,542,509		-		12,907,609
15 West Apartments (4)	WA		9,531,842		2,799,259		-		12,331,101
Mortgage revenue bonds held in trust		$	639,116,502	$	111,818,346	$	-	$	750,934,848

(1)

MRBs owned by ATAX TEBS I, LLC (M24 TEBS), Note 15

(2)

MRBs owned by ATAX TEBS II, LLC (M31 TEBS), Note 15

(3)

MRBs owned by ATAX TEBS III, LLC (M33 TEBS), Note 15

(4)

MRBs owned by ATAX TEBS IV, LLC (M45 TEBS), Note 15

(5)

MRB held by Morgan Stanley in a debt financing transaction Note 15

(6)

MRB held by Mizuho Capital Markets, LLC in a debt financing transaction, Note 15


	December 31, 2021
Description of Mortgage Revenue Bonds held by the Partnership	State	Cost Adjusted for Paydowns and Allowances		Cumulative Unrealized Gain		Cumulative Unrealized Loss		Estimated Fair Value
Lutheran Gardens	CA	$	10,352,000	$	-	$	-	$	10,352,000
Solano Vista - Series A	CA		2,649,291		744,617		-		3,393,908
Live 929 Apartments - 2014 Series B	MD		17,344,000		-		-		17,344,000
Meadow Valley	MI		100,000		-		-		100,000
Greens Property - Series B	NC		920,637		46,672		-		967,309
Ohio Properties - Series B	OH		3,465,270		-		-		3,465,270
Provision Center 2014-1	TN		4,300,000		-		-		4,300,000
Avistar at the Crest - Series B	TX		730,612		122,646		-		853,258
Avistar at the Oaks - Series B	TX		534,953		86,437		-		621,390
Avistar at the Parkway - Series B	TX		123,598		37,590		-		161,188
Avistar in 09 - Series B	TX		441,288		71,303		-		512,591
Avistar on the Boulevard - Series B	TX		434,132		69,950		-		504,082
Mortgage revenue bonds held by the Partnership		$	41,395,781	$	1,179,215	$	-	$	42,574,996

The Partnership has committed to provide funding for certain MRBs on a draw-down basis during construction and/or rehabilitation of the secured properties as of September 30, 2022. See Note 18 for additional information regarding the Partnership’s MRB funding commitments.

See Note 22 for a description of the methodology and significant assumptions used in determining the fair value of the MRBs. Unrealized gains or losses on the MRBs are recorded in the Partnership's condensed consolidated statements of comprehensive income to reflect changes in their estimated fair values resulting from market conditions and fluctuations in the present value of the expected cash flows from the MRBs.

During the nine months ended September 30, 2021, the Partnership recognized a provision for credit loss of approximately $900,000 related to the Provision Center 2014-1 MRB in its condensed consolidated statements of operations. The borrower of the Provision Center 2014-1 MRB filed for Chapter 11 bankruptcy in December 2020 and has ceased making contractual principal and interest payments. The credit loss was driven primarily by collateral information obtained during the bankruptcy process. The underlying property was successfully sold out of bankruptcy in July 2022 and final settlement of the bankruptcy estate is ongoing. The net carrying value of the MRB, inclusive of accrued interest, is $4.6 million as of September 30, 2022, which is our estimate of the proceeds we will ultimately receive upon liquidation of the bankruptcy and bond trust estate.

MRB Activity in the First Nine Months of 2022

Acquisitions:

The following MRBs were acquired at prices that approximated the principal outstanding plus accrued interest during the nine months ended September 30, 2022:


Property Name	Month Acquired	Property Location	Units		Maturity Date	Interest Rate				Principal Acquired
Residency at the Entrepreneur - Series J-1	April	Los Angeles, CA		200	3/31/2040		6.00	%		$	9,000,000
Residency at the Entrepreneur - Series J-2	April	Los Angeles, CA		200	3/31/2040		6.00	%			7,500,000
Residency at the Entrepreneur - Series J-3	April	Los Angeles, CA		200	3/31/2040		6.00	%		(1)
Residency at the Entrepreneur - Series J-4	April	Los Angeles, CA		200	3/31/2040	SOFR + 3.60%			(2)	(1)
CCBA Senior Garden Apartments (3)	June	San Diego, CA		45	7/1/2037		4.50	%			3,807,000
										$	20,307,000

(1)

The Partnership has committed to provide funding for the Series J-3 and Series J-4 MRBs of $26.1 million and $16.4 million, respectively. See Note 18.

(2)

The interest rate is subject to an all-in floor of 3.87%. Upon stabilization, the Series J-4 MRB will become subordinate to the Series J-1, J-2 and J-3 MRBs and will convert to a fixed rate of 8.0%. Upon stabilization of the property, the MRB will be partially repaid and the maximum balance of the MRB after stabilization will not exceed $1.5 million.

(3)

The investment was previously reported as a bond purchase commitment that has converted to an MRB.

Restructurings:

In January 2022, the Live 929 Apartments property completed a restructuring of the Partnership’s MRBs and property loan. The Partnership’s Live 929 Apartments – 2014 Series A and Live 929 Apartments – 2014 Series B MRBs were redeemed at par plus accrued interest. The following tables summarizes the terms of the MRBs upon redemption:


Property Name	Month Redeemed	Property Location	Units		Original Maturity Date	Interest Rate			Principal Outstanding at Date of Redemption
Live 929 Apartments - 2014 Series A	January	Baltimore, MD		575	7/1/2049		5.78	%	$	39,445,000
Live 929 Apartments - 2014 Series B	January	Baltimore, MD		575	7/1/2039		1.60	%		21,610,000
									$	61,055,000

Upon restructuring, the Partnership used the proceeds of the redeemed MRBs plus additional cash to acquire a new series of MRB secured by the Live 929 Apartments property, the Series 2022A MRB. The following tables summarizes the MRB that was acquired as part of the restructuring of the Live 929 Apartments MRBs:

Property Name

Month
Acquired

Property Location

Units

Maturity Date

Interest Rate

Principal Acquired

Live 929 Apartments - Series 2022A

January

Baltimore, MD

575

1/1/2060

4.30

66,365,000

In addition, a portion of the Live 929 Apartments property loan was redeemed as part of the restructuring, with proceeds used to acquire the new Live 929 Apartments Series 2022A MRB. The Partnership also acquired a taxable MRB which is reported in Other Assets (Note 12). The redemption of the prior Live 929 Apartments – 2014 Series A and 2014 Series B MRBs and property loan and acquisition of the new Live 929 Apartments Series 2022A MRB were accounted for as a troubled debt restructuring.

Redemptions:

The following MRBs were redeemed at a price that approximated the Partnership’s carrying value plus accrued interest during the nine months ended September 30, 2022:


Property Name	Month Redeemed	Property Location	Units		Original Maturity Date	Interest Rate			Principal Outstanding at Date of Redemption
Ohio Properties - Series A	March	(1)		362	6/1/2050		7.00	%	$	13,544,000
Ohio Properties - Series B	March	(1)		362	6/1/2050		10.00	%		3,459,840
Bridle Ridge	May	Greer, SC		152	1/1/2043		6.00	%		7,100,000
Cross Creek	September	Beaufort, SC		144	3/1/2049		6.15	%		7,666,752
									$	31,770,592

(1)

The Ohio Properties consist of Crescent Village, located in Cincinnati, Ohio, Willow Bend, located in Columbus (Hilliard), Ohio and Postwoods, located in Reynoldsburg, Ohio.

MRB Activity in the First Nine Months of 2021

Acquisitions:

The following MRB was acquired at a price that approximated the principal outstanding plus accrued interest during the nine months ended September 30, 2021:

Property Name

Month
Acquired

Property Location

Units

Maturity Date

Interest Rate

Initial Principal Acquired

Jackson Manor Apartments (1)

April

Jackson, MS

60

5/1/2038

5.00

4,150,000

(1)

The Partnership has committed to provide total funding of the MRB up to $6.9 million during the acquisition and rehabilitation phase of the property on a drawdown basis. Upon stabilization of the property, the MRB will be partially repaid and the maximum balance of the MRB after stabilization will not exceed $4.8 million.

Redemptions:

The following MRBs were redeemed at a price that approximated the Partnership’s carrying value plus accrued interest during the nine months ended September 30, 2021:


Property Name	Month Redeemed	Property Location	Units		Original Maturity Date	Interest Rate			Principal Outstanding at Date of Redemption
Arby Road Apartments - Series A (1)	March	Las Vegas, NV		180	10/1/2027		5.35	%	$	1,600,000
Arby Road Apartments - Series A (1)	March	Las Vegas, NV		180	4/1/2041		5.50	%		5,785,000
Rosewood Townhomes - Series A	July	Goose Creek, SC		100	7/1/2055		5.75	%		9,259,206
Rosewood Townhomes - Series B	July	Goose Creek, SC		100	8/1/2055		12.00	%		469,781
South Pointe Apartments - Series A	July	Hanahan, SC		256	7/1/2055		5.75	%		21,551,600
South Pointe Apartments - Series B	July	Hanahan, SC		256	8/1/2055		12.00	%		1,099,487
									$	39,765,074

(1)

Both MRBs are part of the same series but had different interest rates and maturity dates.

The Rosewood Townhomes - Series A and South Pointe Apartments - Series A MRBs were redeemed at 106% of par value plus accrued interest in July 2021. The redemption premium of approximately $1.8 million is reported as “Contingent interest income” in the condensed consolidated statement of operations. All other MRBs were redeemed at a price that approximated the Partnership’s carrying value plus accrued interest.

The following table summarizes the changes in the Partnership’s allowance for credit losses for the three and nine months ended September 30, 2022 and 2021:


	For the Three Months Ended September 30,					For the Nine Months Ended September 30,
	2022			2021		2022			2021
Balance, beginning of period	$	10,013,392		$	8,218,669	$	9,175,482		$	7,318,589
Provision for credit loss		-			-		-			900,080
Other additions (1)		-			-		860,533			-
Recovery of prior credit loss (2)		(17,345	)		-		(39,968	)		-
Balance, end of period (3)	$	9,996,047		$	8,218,669	$	9,996,047		$	8,218,669

(1)

The other addition is related to a re-allocation of the loan loss allowance upon restructuring of the Live 929 Apartments MRBs and property loan.

(2)

The Partnership compared the present value of cash flows expected to be collected to the amortized cost basis of the Live 929 Apartments Series 2022A MRB, which indicated a recovery of value. The Partnership will accrete the recovery of prior credit loss into investment income over the term of the MRB.

(3)

The allowance for credit losses as of September 30, 2022 is related to the Provision Center 2014-1 MRB and the Live 929 Apartments - Series 2022A MRB. The allowance for credit losses as of September 30, 2021 is related to the Provision Center 2014-1 MRB and the Live 929 Apartments – 2014 Series A MRB.

7. Governmental Issuer Loans

The Partnership owns governmental issuer loans (“GILs”) that are issued by state or local governmental authorities to finance the construction of affordable multifamily properties. The Partnership expects and believes the interest earned on the GILs is excludable from gross income for federal income tax purposes. The GILs do not constitute an obligation of any government, agency or authority and no government, agency or authority is liable for them, nor is the taxing power of any government pledged to the payment of principal or interest on the GILs. Each GIL is secured by a mortgage on all real and personal property of the affordable multifamily property. The GILs share first mortgage lien positions with property loans and/or taxable GILs also owned by the Partnership (Notes 10 and 12). Sources of the funds to pay principal and interest on a GIL consist of the net cash flow or the sale or refinancing proceeds from the secured property and limited-to-full payment guaranties provided by affiliates of the borrower. The Partnership has committed to provide total funding for certain GILs on a draw-down basis during construction. The GILs, with the exception of Poppy Grove I, Poppy Grove II, and Poppy Grove III, were held in trust in connection with TOB trust financings as of September 30, 2022 and December 31, 2021 (Note 15). At the closing of each GIL, Freddie Mac, through a servicer, has forward committed to purchase the GIL at maturity if the property has reached stabilization and other conditions are met (Note 21).

The Partnership had the following GIL investments as of September 30, 2022 and December 31, 2021:

As of September 30, 2022

Property Name

Month 
Acquired

Property
Location

Units

Maturity
Date (1)

Interest Rate (2)

Current Interest
Rate

Amortized
Cost

Scharbauer Flats Apartments (3)

June 2020

Midland, TX

300

1/1/2023

SIFMA + 3.10%

5.56%

40,000,000

Oasis at Twin Lakes (3)

July 2020

Roseville, MN

228

8/1/2023

SIFMA + 2.25%

4.71%

34,000,000

Centennial Crossings (3)

August 2020

Centennial, CO

209

9/1/2023

SIFMA + 2.75%

5.21%

33,080,000

Legacy Commons at Signal Hills (3)

January 2021

St. Paul, MN

247

2/1/2024

SOFR + 3.07%

6.05%

34,620,000

Hilltop at Signal Hills (3)

January 2021

St. Paul, MN

146

8/1/2023

SOFR + 3.07%

6.05%

24,450,000

Hope on Avalon

January 2021

Los Angeles, CA

88

2/1/2023

SIFMA + 3.75%

6.21%

23,390,000

Hope on Broadway

January 2021

Los Angeles, CA

49

2/1/2023

SIFMA + 3.75%

6.21%

10,691,245

Osprey Village (3)

July 2021

Kissimmee, FL

383

8/1/2024

SOFR + 3.07%

5.36%

30,648,439

Willow Place Apartments (3)

September 2021

McDonough, GA

182

10/1/2024

SOFR + 3.30%

5.59%

12,358,271

Magnolia Heights (3)

June 2022

Covington, GA

200

7/1/2024

SOFR + 3.85%

6.14%

20,400,000

Poppy Grove I (3), (4)

September 2022

Elk Grove, CA

147

4/1/2025

6.78%

6.78%

6,746,000

Poppy Grove II (3), (4)

September 2022

Elk Grove, CA

82

4/1/2025

6.78%

6.78%

3,541,300

Poppy Grove III (3), (4)

September 2022

Elk Grove, CA

158

4/1/2025

6.78%

6.78%

7,350,000

281,275,255

(1)

The borrowers may elect to extend the maturity dates for periods ranging between six and twelve months upon meeting certain conditions, which may include payment of a non-refundable extension fee.

(2)

The variable index interest rate components are typically subject to floors that range from 0% to 0.85%.

(3)

The Freddie Mac servicer that has forward committed to purchase the GIL at maturity is an affiliate of the Partnership (Note 21).

(4)

The Partnership has agreed to provide a subordinate GIL after the execution of Freddie Mac’s forward purchase commitment if needed by the property. The potential subordinate GIL amounts are up to $3.8 million, $2.2 million, and $4.2 million for Poppy Grove I, Poppy Grove II, and Poppy Grove III, respectively.

As of December 31, 2021

Property Name

Month 
Acquired

Property
Location

Units

Maturity
Date (1)

Variable Interest
Rate (2)

Current Interest
Rate

Amortized
Cost

Scharbauer Flats Apartments (3)

June 2020

Midland, TX

300

1/1/2023

SIFMA + 3.10%

3.20%

40,000,000

Oasis at Twin Lakes (3)

July 2020

Roseville, MN

228

8/1/2023

SIFMA + 3.25%

(4)

3.75%

34,000,000

Centennial Crossings (3)

August 2020

Centennial, CO

209

9/1/2023

SIFMA + 2.75%

3.25%

33,080,000

Legacy Commons at Signal Hills (3)

January 2021

St. Paul, MN

247

2/1/2024

SOFR + 3.07%

3.57%

33,120,605

Hilltop at Signal Hills (3)

January 2021

St. Paul, MN

146

8/1/2023

SOFR + 3.07%

3.57%

21,550,584

Hope on Avalon

January 2021

Los Angeles, CA

88

2/1/2023

SIFMA + 3.75%

4.60%

9,981,200

Hope on Broadway

January 2021

Los Angeles, CA

49

2/1/2023

SIFMA + 3.75%

4.60%

3,691,245

Osprey Village (3)

July 2021

Kissimmee, FL

383

8/1/2024

SOFR + 3.07%

3.57%

6,372,030

Willow Place Apartments (3)

September 2021

McDonough, GA

182

10/1/2024

SOFR + 3.30%

3.55%

2,971,786

184,767,450

(1)

The borrowers may elect to extend the maturity dates for periods ranging between six and twelve months upon meeting certain conditions, which may include payment of a non-refundable extension fee.

(2)

The variable index interest rate components are typically subject to floors that range from 0% to 0.85%.

(3)

The Freddie Mac servicer that has forward committed to purchase the GIL at maturity is an affiliate of the Partnership (Note 21).

(4)

The variable rate decreases to SIFMA plus 2.25% upon completion of construction.

The partnership has remaining commitments to provide additional funding of the GILs during construction and/or rehabilitation of the secured properties as of September 30, 2022. See Note 18 for further information regarding the Partnership’s remaining GIL funding commitments.

Activity in the First Nine Months of 2022

Acquisitions:

During the nine months ended September 30, 2022, the Partnership entered into multiple GIL commitments to provide construction financing for the underlying properties on a draw-down basis as summarized below.

•

$20.4 million commitment related to Magnolia Heights;

•

$35.7 million commitment related to Poppy Grove I;

•

$22.3 million commitment related to Poppy Grove II; and

•

$39.1 million commitment related to Poppy Grove III.

Activity in the First Nine Months of 2021

Acquisitions:

During the nine months ended September 30, 2021, the Partnership entered into multiple GIL commitments to provide construction financing for the underlying properties on a draw-down basis as summarized below.

•

$34.6 million commitment related to Legacy Commons at Signal Hills;

•

$24.5 million commitment related to Hilltop at Signal Hills;

•

$23.4 million commitment related to Hope on Avalon;

•

$12.1 million commitment related to Hope on Broadway;

•

$60.0 million commitment related to Osprey Village; and

•

$25.0 million commitment related to Willow Place Apartments.

8. Real Estate Assets

The following tables summarize information regarding the Partnership’s real estate assets as of September 30, 2022 and December 31, 2021:


Real Estate Assets as of September 30, 2022
Property Name	Location	Number of Units		Land and Land Improvements		Buildings and Improvements		Carrying Value
Suites on Paseo	San Diego, CA		384	$	3,205,961	$	39,426,150	$	42,632,111
The 50/50 MF Property	Lincoln, NE		475		-		33,812,722		33,812,722
Vantage at San Marcos	San Marcos, TX	(1)			2,660,615		682,929		3,343,544
Land held for development		(2)			1,551,196		-		1,551,196
								$	81,339,573
Less accumulated depreciation									(22,740,549	)
Net real estate assets								$	58,599,024

(1)

The land is owned by a consolidated VIE for future development of a market-rate multifamily property. See Note 5 for further information.

(2)

Land held for development consists of land and development costs for parcels of land in Richland County, SC and Omaha, NE.


Real Estate Assets as of December 31, 2021
Property Name	Location	Number of Units		Land and Land Improvements		Buildings and Improvements		Carrying Value
Suites on Paseo	San Diego, CA		384	$	3,199,268	$	39,302,507	$	42,501,775
The 50/50 MF Property	Lincoln, NE		475		-		33,013,039		33,013,039
Vantage at San Marcos	San Marcos, TX	(1)			2,660,615		682,929		3,343,544
Land held for development		(2)			1,551,196		-		1,551,196
								$	80,409,554
Less accumulated depreciation									(20,701,922	)
Net real estate assets								$	59,707,632

(1)

The assets are owned by a consolidated VIE for future development of a market-rate multifamily property. See Note 5 for further information.

(2)

Land held for development consists of land and development costs for parcels of land in Richland County, SC and Omaha, NE.

9. Investments in Unconsolidated Entities

ATAX Vantage Holdings, LLC, a wholly owned subsidiary of the Partnership, has equity investment commitments and has made equity investments in unconsolidated entities. The carrying value of the equity investments represents the Partnership’s maximum exposure to loss. ATAX Vantage Holdings, LLC is the only limited equity investor in the unconsolidated entities. An affiliate of the unconsolidated entities guaranties ATAX Vantage Holdings, LLC’s return on its investments through a date approximately five years after commencement of construction. The return on these investments earned by the Partnership is reported as “Investment income” in the Partnership's condensed consolidated statements of operations.

The following table provides the details of the investments in unconsolidated entities as of September 30, 2022 and December 31, 2021:


Property Name	Location	Units		Construction Commencement Date	Construction Completion Date	Carrying Value as of September 30, 2022		Carrying Value as of December 31, 2021
Vantage at Stone Creek	Omaha, NE		294	March 2018	April 2020	$	5,506,982	$	6,143,099
Vantage at Murfreesboro	Murfreesboro, TN		288	September 2018	October 2020		-		12,240,000
Vantage at Coventry	Omaha, NE		294	September 2018	February 2021		6,880,265		7,611,614
Vantage at Conroe	Conroe, TX		288	April 2019	January 2021		10,424,625		11,164,625
Vantage at O'Connor	San Antonio, TX		288	October 2019	June 2021		-		9,109,343
Vantage at Westover Hills	San Antonio, TX		288	January 2020	July 2021		-		8,861,504
Vantage at Tomball	Tomball, TX		288	August 2020	April 2022		12,731,001		11,814,774
Vantage at Hutto	Hutto, TX		288	December 2021	N/A		12,280,709		5,629,651
Vantage at Loveland	Loveland, CO		288	April 2021	N/A		17,752,152		10,913,911
Vantage at Helotes	Helotes, TX		288	May 2021	N/A		13,752,151		11,350,686
Vantage at Fair Oaks	Boerne, TX		288	September 2021	N/A		11,763,456		6,424,306
Vantage at McKinney Falls	McKinney Falls, TX		288	December 2021	N/A		12,011,905		6,530,009
						$	103,103,246	$	107,793,522

The Partnership has remaining commitments to provide additional equity funding for certain unconsolidated entities as of September 30, 2022. See Note 18 for further information regarding the Partnership’s remaining equity funding commitments.

Activity in the First Nine Months of 2022

Sales Activity:

The following table summarizes sales information of the Partnership’s investments in unconsolidated entities during the nine months ended September 30, 2022:


Property Name	Location	Units		Month Sold	Gross Proceeds to the Partnership		Investment Income		Gain on Sale
Vantage at Murfreesboro	Murfreesboro, TN		288	March 2022	$	29,258,279	$	657,937	$	16,360,343
Vantage at Westover Hills	San Antonio, TX		288	May 2022		20,923,784		-		12,658,501
Vantage at Bulverde	Bulverde, TX		288	(1)		60,000		-		60,000
Vantage at Germantown	Germantown, TN		288	(2)		4,407		-		4,407
Vantage at O'Connor	San Antonio, TX		288	July 2022		19,381,976		1,195		10,580,781
					$	69,628,446	$	659,132	$	39,664,032

(1)

During the first nine months of 2022, the Partnership received net cash of approximately $60,000 associated with final settlements of the Vantage at Bulverde sale in August 2021. The Partnership recognized the full amount as "Gain on sale of investment in an unconsolidated entity" on the Partnership’s consolidated statements of operations.

(2)

In March 2022, the Partnership received cash of approximately $4,000 associated with final settlements of the Vantage at Germantown sale in March 2021. The Partnership recognized the full amount as "Gain on sale of investment in an unconsolidated entity" on the Partnership’s consolidated statements of operations.

Activity in the First Nine Months of 2021

Sales Activity:

The following table summarizes sales information of the Partnership’s investments in unconsolidated entities during the nine months ended September 30, 2021:


Property Name	Location	Units		Month Sold	Gross Proceeds to the Partnership		Investment Income		Gain on Sale
Vantage at Germantown	Germantown, TN		288	March 2021	$	16,096,560	$	862,454	$	2,809,106
Vantage at Powdersville	Powdersville, SC		288	May 2021		20,118,680		2,359,394		5,463,484
Vantage at Bulverde	Bulverde, TX		288	August 2021		18,916,961		1,392,312		6,954,649
					$	55,132,201	$	4,614,160	$	15,227,239

New and Amended Equity Commitments:

In April 2021, the Partnership executed a $16.3 million equity commitment to fund the construction of the Vantage at Loveland multifamily property.

In May 2021, the Partnership executed a $12.6 million equity commitment to fund the construction of the Vantage at Helotes multifamily property.

In September 2021, Vantage at Fair Oaks ceased to be a consolidated VIE (Note 5) and the Partnership executed an $11.0 million commitment to fund the construction of the property.

Summarized Unconsolidated Entity Level Financial Data

The following table provides combined summary financial information for the properties underlying the Partnership’s investments in unconsolidated entities for the three and nine months ended September 30, 2022 and 2021:


	For the Three Months Ended September 30,				For the Nine Months Ended September 30,
	2022		2021		2022		2021
Property Revenues	$	4,732,250	$	6,486,029	$	16,847,354	$	17,444,805
Gain on sale of property	$	23,231,887	$	17,646,543	$	87,835,109	$	42,273,235
Net income	$	23,309,924	$	17,591,694	$	88,447,049	$	38,102,642

10. Property Loans, Net of Loan Loss Allowances

The following tables summarize the Partnership’s property loans, net of loan loss allowances, as of September 30, 2022 and December 31, 2021:


	September 30, 2022
	Outstanding Balance		Loan Loss Allowance			Property Loan Principal, net of allowance		Maturity Date	Interest Rate
Senior Construction Financing (1)
Centennial Crossings	$	24,250,000	$	-		$	24,250,000	9/1/2023	LIBOR + 2.50%
Hilltop at Signal Hills		18,968,334		-			18,968,334	8/1/2023	SOFR + 3.07%
Legacy Commons at Signal Hills		28,166,905		-			28,166,905	2/1/2024	SOFR + 3.07%
Magnolia Heights		1,000,000		-			1,000,000	7/1/2024	SOFR + 3.85%
Oasis at Twin Lakes		24,018,657		-			24,018,657	8/1/2023	LIBOR + 2.50%
Osprey Village		1,000,000		-			1,000,000	8/1/2024	SOFR + 3.07%
Scharbauer Flats Apartments		24,160,000		-			24,160,000	1/1/2023	LIBOR + 2.85%
Willow Place Apartments		1,000,000		-			1,000,000	10/1/2024	SOFR + 3.30%
Subtotal		122,563,896		-			122,563,896

Other
Avistar (February 2013 portfolio)	$	201,972	$	-		$	201,972	6/26/2024	12.00%
Avistar (June 2013 portfolio)		251,622		-			251,622	6/26/2024	12.00%
Greens Property		850,000		-			850,000	9/1/2046	10.00%
Live 929 Apartments		495,000		(495,000	)		-	7/31/2049	8.00%
Subtotal		1,798,594		(495,000	)		1,303,594

Total	$	124,362,490	$	(495,000	)	$	123,867,490

(1)

The property loans are held in trust in connection with TOB trust financings (Note 15). The property loans and associated GILs are on parity and share a first mortgage lien position on all real and personal property associated with the underlying property. Affiliates of the borrowers have guaranteed limited-to-full payment of principal and accrued interest on the property loans. The borrowers may elect to extend the maturity dates for periods ranging between six and twelve months upon meeting certain conditions, which may include payment of a non-refundable extension fee. The variable index interest rate components are typically subject to floors that range from 0% to 0.50%.


	December 31, 2021
	Outstanding Balance		Loan Loss Allowance		Property Loan Principal, net of allowance		Maturity Date	Interest Rate
Senior Construction Financing (1)
Centennial Crossings	$	11,354,386	$	-	$	11,354,386	9/1/2023	LIBOR + 2.50%
Hilltop at Signal Hills		1,000,000		-		1,000,000	8/1/2023	SOFR + 3.07%
Legacy Commons at Signal Hills		2,604,230		-		2,604,230	2/1/2024	SOFR + 3.07%
Oasis at Twin Lakes		20,607,362		-		20,607,362	8/1/2023	LIBOR + 2.50%
Osprey Village		1,000,000		-		1,000,000	8/1/2024	SOFR + 3.07%
Scharbauer Flats Apartments		9,708,598		-		9,708,598	1/1/2023	LIBOR + 2.85%
Willow Place Apartments		1,000,000		-		1,000,000	10/1/2024	SOFR + 3.30%
Subtotal		47,274,576


Delaware		47-0810385
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

14301 FNB Parkway, Suite 211, Omaha, Nebraska		68154
(Address of principal executive offices)		(Zip Code)

(402) 952-1235
(Registrant’s telephone number, including area code)
N/A
(Former name, former address and former fiscal year, if changed since last report)


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Beneficial Unit Certificates representing assignments of limited partnership interests in America First Multifamily Investors, L.P.	ATAX	The NASDAQ Stock Market, LLC


Large accelerated filer	☐	Accelerated filer	☐
Non-accelerated filer	☒	Smaller reporting company	☒
Emerging growth company	☐


Item 1	Financial Statements (Unaudited)	5
	Condensed Consolidated Balance Sheets	5
	Condensed Consolidated Statements of Operations	6
	Condensed Consolidated Statements of Comprehensive Income (Loss)	7
	Condensed Consolidated Statements of Partners’ Capital	8
	Condensed Consolidated Statements of Cash Flows	9
	Notes to Condensed Consolidated Financial Statements	10
Item 2	Management’s Discussion and Analysis of Financial Condition and Results of Operations	52
Item 3	Quantitative and Qualitative Disclosures About Market Risk	86
Item 4	Controls and Procedures	90

PART II – OTHER INFORMATION
Item 1A	Risk Factors	91
Item 6	Exhibits	92
SIGNATURES		93


	September 30, 2022			December 31, 2021
Assets:
Cash and cash equivalents	$	103,203,582		$	68,285,501
Restricted cash		45,850,046			83,646,969
Interest receivable, net		9,402,254			9,234,412
Mortgage revenue bonds held in trust, at fair value (Note 6)		675,905,519			750,934,848
Mortgage revenue bonds, at fair value (Note 6)		19,163,911			42,574,996
Governmental issuer loans (Note 7)		281,275,255			184,767,450
Real estate assets: (Note 8)
Land and improvements		7,417,772			7,411,079
Buildings and improvements		73,921,801			72,998,475
Real estate assets before accumulated depreciation		81,339,573			80,409,554
Accumulated depreciation		(22,740,549	)		(20,701,922	)
Net real estate assets		58,599,024			59,707,632
Investments in unconsolidated entities (Note 9)		103,103,246			107,793,522
Property loans, net of loan loss allowances (Note 10)		123,867,490			68,101,268
Other assets (Note 12)		29,716,668			10,862,885
Total Assets	$	1,450,086,995		$	1,385,909,483

Liabilities:
Accounts payable, accrued expenses and other liabilities (Note 13)	$	16,366,122		$	13,664,212
Distribution payable		8,312,836			12,757,459
Secured lines of credit (Note 14)		30,942,000			45,714,000
Debt financing, net (Note 15)		962,615,366			820,078,714
Mortgages payable and other secured financing, net (Note 16)		26,230,855			26,824,543
Total Liabilities		1,044,467,179			919,038,928

Commitments and Contingencies (Note 18)

Redeemable Preferred Units, $94.5 million redemption value, 9.5 million issued and outstanding, net (Note 19)		94,452,679			94,458,528

Partnersʼ Capital:
General Partner (Note 1)		66,795			765,550
Beneficial Unit Certificates ("BUCs," Note 1)		311,100,342			371,646,477
Total Partnersʼ Capital		311,167,137			372,412,027
Total Liabilities and Partnersʼ Capital	$	1,450,086,995		$	1,385,909,483


☒	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


☐	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934


	General Partner			# of BUCs - Restricted and Unrestricted*			BUCs - Restricted and Unrestricted			Total			Accumulated Other Comprehensive Income (Loss)
Balance as of December 31, 2021	$	765,550			22,324,012		$	371,646,477		$	372,412,027		$	114,040,260
Distributions paid or accrued ($0.327 per BUC):*
Distribution of Tier 2 income (Note 3)		(2,430,358	)		-			(7,291,072	)		(9,721,430	)		-
Net income allocable to Partners		2,737,044			-			22,809,230			25,546,274			-
Restricted unit compensation expense		1,739			-			172,159			173,898			-
Unrealized loss on securities		(477,517	)		-			(47,274,139	)		(47,751,656	)		(47,751,656	)
Unrealized loss on bond purchase commitments		(8,191	)		-			(810,890	)		(819,081	)		(819,081	)
Balance as of March 31, 2022		588,267			22,324,012			339,251,765			339,840,032			65,469,523
Distributions paid or accrued ($0.564 per BUC):*
Distribution of Tier 2 income (Note 3)		(405,190	)		-			(1,215,574	)		(1,620,764	)		-
Distribution of Tier 3 income (Note 3)		-			-			(11,378,312	)		(11,378,312	)		-
Net income allocable to Partners		232,036			-			16,658,145			16,890,181			-
Restricted units forfeited		-			(902	)		-			-			-
Restricted unit compensation expense		1,655			-			163,854			165,509			-
Unrealized loss on securities		(198,800	)		-			(19,681,202	)		(19,880,002	)		(19,880,002	)
Unrealized loss on bond purchase commitments		(1,364	)		-			(135,006	)		(136,370	)		(136,370	)
Rounding of BUCs upon Reverse Unit Split		-			1,292			-			-			-
Balance as of June 30, 2022		216,604			22,324,402			323,663,670			323,880,274			45,453,151
Distributions paid or accrued ($0.366 per BUC):*
Distribution of Tier 2 income (Note 3)		(70,200	)		-			(210,599	)		(280,799	)		-
Distribution of Tier 3 income (Note 3)		-			-			(8,032,037	)		(8,032,037	)		-
Net income allocable to Partners		142,394			-			17,657,709			17,800,103			-
Restricted units awarded		-			91,813			-			-			-
Restricted unit compensation expense		5,802			-			574,354			580,156			-
Unrealized loss on securities		(226,887	)		-			(22,461,809	)		(22,688,696	)		(22,688,696	)
Unrealized loss on bond purchase commitments		(918	)		-			(90,946	)		(91,864	)		(91,864	)
Balance as of September 30, 2022	$	66,795			22,416,215		$	311,100,342		$	311,167,137		$	22,672,591


	September 30, 2022		September 30, 2021
Cash and cash equivalents	$	103,203,582	$	91,542,566
Restricted cash		45,850,046		83,257,569
Total cash, cash equivalents and restricted cash	$	149,053,628	$	174,800,135