D3G was selected to support a public housing authority (PHA) with a repositioning study to convert its entire public housing portfolio to the Section 8 platform. The study results indicated that a Section 18 scattered site disposition followed by a RAD/Section 18 Small PHA Blend conversion was most advantageous financially and fit the PHA’s overall goals.
The scattered site single-family homes required planning for multiple Part 58 Environmental Reviews and coordination with the local responsible entity. The PHA had experience with one-off Section 18 disposition applications but nothing on the level of disposing of 30+ properties. D3G was there to assist with the application and understand how the Section 18 work could benefit a subsequent RAD transaction by generating Demo-Dispo Transitional Funding (DDTF).
The RAD/Section 18 Blend conversion for two public housing properties totaled over 80 units. The properties range in age from the late 1960s to the late 1980s and include two-story townhomes and multifamily buildings. The environmental profile included high radon risk zones (EPA Zone 1) and the presence of a floodplain on one of the sites, further complicating the planning process.
Although the two properties would be converted to Section 8 housing in the same transaction, the differences in age, structure type, and site locations meant that preparing capital needs and environmental reports, developing long-term financing strategies, and meeting regulatory requirements would be challenging.
The PHA was active with its non-profit affordable housing development arm, already developing LIHTC properties and providing property management services in their wider community. Now, it was ready to accelerate its goal to be a mission-driven real estate organization through the Section 18 and RAD programs. Repositioning would help the housing authority to rehabilitate its aging properties, secure more predictable funding, lighten its regulatory burden, and position its properties to fuel new investments in affordable housing within the community.
D3G had consulted on a Section 18 application to dispose of over 30 scattered sites owned by the PHA, with the goal of increasing subsidy levels using project-based vouchers generated by the Section 18 process. The D3G Consulting Team is providing application consulting for a RAD/Section 18 Blend conversion, which includes developing detailed due diligence reports to support the conversion. The reports were intended to ascertain the environmental conditions at both sites, ensure compliance with HUD protocols, and outline recommendations for long-term rehabilitation and energy efficiency upgrades. The Consulting Team is also assisting with the PHA close-out process (HUD-5837 form).
Undertaking a RAD/Section 18 project of this magnitude usually requires partnering with an experienced developer. D3G Consulting prepared RFPs and RFQs for repositioning legal services and a co-development partner. The PHA leveraged D3G’s experience evaluating developer business terms offers and selected a high-quality co-development partner to help them create development plans, secure tax credit equity, solicit lenders, manage construction, and build PHA capacity.
D3G assessed the PHA scattered sites and determined 30+ properties eligible for disposition to the PHA non-profit resulting in a “subsidy swap” that drastically increased subsidy potential. The D3G Consulting team walked the PHA through all steps of the Section 18 52850 and 52860-A processes, including submission through the PIC system.
D3G Consulting worked closely with the PHA to submit a RAD Application to the HUD Office of Recapitalization. The project scope includes full RAD Application support through all ten HUD milestone phases, including initial application, Concept Call preparation, Financing Plan development, and receipt of the RAD Conversion Commitment (RCC). Work is ongoing, and the conversion is expected to close at the end of 2026.
To produce the required due diligence reports, D3G’s team conducted in-depth environmental reviews and engineering analysis across the portfolio. Evaluation areas included:
Existing building systems, accessibility, and code compliance
Environmental risks, including radon, mold, and asbestos potential
Resilience planning based on climate-related vulnerabilities
Recommendations for integrating future energy standards (IECC 2021)
Stakeholder coordination was essential; D3G worked directly with property management and onsite contacts to gather access, resolve data discrepancies, and ensure alignment with HUD and tax credit protocols.
