What is the best way to structure a Multi-Family refinance in a Top 10 MSA with an expiring tax abatement during the term of the loan?
Hey I’m curious to get some thoughts on how to structure a refinance for a large multi family complex with an expiring tax credit within 10 years. The new taxes would decrease the NOI by ~20% once it goes into effect. The property is stabilized. 

Is there any structure for the lender that offers protection for the financing based on the new taxes and takeout of the loan upon the ending term?
[{"id": "fhxutek", "text": "Yeah, the appraisal", "replies": [], "depth": 1}, {"id": "fhxv0l4", "text": "Are you a lender? Give me some background and I can try and help. If you\u2019re a lender, what kind? Is it a resi or commercial? Need more details.", "replies": [], "depth": 1}, {"id": "fhxvizg", "text": "Can do 25 year am until tax expires, 30 or 35 year am thereafter. The higher am will help with lower NOI", "replies": [], "depth": 1}, {"id": "fhxwx83", "text": "Deals with abatements are typically valued by using a cap rate on full tax NOI and adding back the present value of the (hypothetical) remaining tax savings over the abatement term.\n\nFrom a DSCR underwriting perspective, I\u2019ve seen lenders use the average taxes over the remaining term to figure NOI, and not simply using the actual taxes.\n\nDepending on how close your are to the abatement burnoff, they may even underwrite to full taxes.\n\nHope this helps, and good luck!", "replies": [{"id": "fhxykmi", "text": "This is the answer", "replies": [], "depth": 2}, {"id": "fhxyp11", "text": "Not much of a contribution from me, but want to +1 this as the 100% correct answer. Any solution that simply uses the abated bill is a shortcut &amp; a mistake.", "replies": [], "depth": 2}, {"id": "fhy98t5", "text": "As a former lender, this is the answer.", "replies": [], "depth": 2}], "depth": 1}, {"id": "fhxxw3a", "text": "If they are tax credit restrictions, ask them to extend them. Most Housing Authorities will help out a property owner to extend the affordability restrictions. I have also done bifurcated mortgages where you underwrite an A mortgage for the full term and a B mortgage for the additional NOI available for the remainder of the 10 year term of the abatement - mortgage would be a 10 year term. B piece would be sized off the difference between hypothetical market RE taxes and actual.", "replies": [{"id": "fhy1nqe", "text": "Would you be able to provide more detail on the bifurcated structure? Is that referring to a senior a mezz piece?", "replies": [], "depth": 2}], "depth": 1}, {"id": "fir09bm", "text": "I work for a fixed rate lender, we would UW the 10 year average of your tax bill (assuming growth). Additionally, we look at full taxes in year 10 to ensure we can be paid off at maturity on full taxes.", "replies": [], "depth": 1}]