THE COMMONWEALTH OF MASSACHUSETTS

EXECUTIVE OFFICE OF HOUSING

AND LIVABLE COMMUNITIES

100 CAMBRIDGE STREET

BOSTON, MA 02108

NOTICE OF FUNDING AVAILABILITY (NOFA)

For Commercial Conversion Tax Credit Initiative

DOCUMENT TITLE: Commercial Conversion Tax Credit Initiative NOFA DATE: August 24, 2026

COMMBUYS BID #: BD-27-1076-OCDDE-HD006-132394

AGENCY DOCUMENT #: HLC0000130

DIVISION: HOUSING DEVELOPMENT

COMMERCIAL CONVERSION TAX CREDIT INITIATIVE (CCTCI)

Notice of Funding Availability (NOFA)

August 2026

I. Introduction

Pursuant to M.G.L. c. 23B, § 36(g) as inserted by Section 5 of Chapter 150 of the Acts of 2024 (the “Affordable Homes Act” or “AHA”) the Executive Office of Housing and Livable Communities (“EOHLC” or “Executive Office”) has established a tax credit program to assist with converting qualifying commercial properties into residential properties.1 By issuing this Notice of Funding Availability (“NOFA”) and its corresponding Commercial Conversion Program Guidelines (the “Guidelines”), which are incorporated by reference herein, EOHLC is soliciting project proposals for allocating the Commercial Conversion Tax Credits available in calendar year (“CY”) 2026.

II. Overview

As a consequence of post-COVID impacts, hundreds of commercial properties stand vacant or underutilized in Massachusetts communities. The Commercial Conversion Tax Credit Initiative (CCTCI) is intended to support the repurposing of commercial buildings as residential and/or mixed-use properties. Under this NOFA, the Executive Office intends to allocate up to $10 million in CCTCI to eligible projects during a limited competition beginning in September 2026. The Executive Office will accept pre-applications or before September 30, 2026 and full Qualified Conversion Project applications CCTCI applications on or before November 13, 2026. EOHLC anticipates making awards through this important initiative in February 2027. This NOFA outlines the anticipated parameters and the minimum anticipated requirements for successful award recipients. EOHLC may make changes to the original terms and requirements identified in this NOFA at any time, to ensure compliance with state and federal laws, regulations, policies, and program goals.

III. Competitive Allocation Process

During the -September 2026 CCTCI competition, HLC will require:

- An initial pre-application to be submitted by (add date);

- A Qualified Conversion Project application to be submitted during a fixed four-week period of time, and;

- A final certification to be submitted on a rolling basis when statutory requirements have been met.

1 See also M.G.L. c. 62, § 6(ee), as inserted by § 17 of AHA and M.G.L. c. 63, § 38OO, as inserted by § 26 of AHA.

Sponsors should note: HLC will only accept Qualified Conversion Project applications if the pre-application has been approved.

A. The Pre-Application Process

All pre-applications must be submitted on an HLC form and will be due no later than September 30, 2026. Pre-application will be assessed based on readiness, developer capacity, and minimum criteria for Qualified Conversion Projects as required by the AHA statute:

• The project consists of the rehabilitation of a commercial property2 for multi-family residential use or mixed use, which may include retail or other commercial uses in addition to residential units, so long as the property is primarily residential;

• The converted property must contain at least two (2) residential units;

• The converted property must contain at least 80% market rate residential units

(rental or homeownership) upon completion of the rehabilitation;

o Units will be considered market rate residential units if they are priced consistently with prevailing rents or sale prices in the municipality as determined by EOHLC in consultation with the municipality where the project is located.

• The property to be rehabilitated – or in limited cases, demolished and replaced with new construction - was nonresidential real property under §168 of the Internal Revenue Code (IRC) prior to the conversion of the property to residential use; and all or a portion of the property was leased, or available for lease, to office tenants; and

• The property was placed in service at least five (5) years prior to beginning the conversion to residential use (the date when construction commences on the rehabilitation project).

If and only if HLC approves a pre-application, the developer will be able to submit a full Qualified Conversion Project application for CCTCI credits during the next HLC competition.

The pre-application requirements are as follows:

- All pre-applications must be complete. HLC will not review incomplete submissions.

- HLC typically will review CCTCI pre-applications only if the CCTCI sponsor has not started construction on the project.

2 Commercial property includes, but is not limited to, commercial centers, office parks and commercial buildings located on main streets or downtown municipal areas. The proposed conversion must be for primary multi-unit residential use or mixed-use, which may include retail or other commercial uses.

- Sponsors of CCTCI applications must be in good standing with HLC and its quasi-public housing affiliates.

- All pre-applications must include a letter of support from the chief elected official of the municipality.

- All pre-applications must include a statement by the sponsor’s architect indicating the status of the architectural drawings/scope.

- All pre-applications should include a one-page memorandum from the architect describing the ways the CCTCI will include components of green and sustainable design, consistent with the Commonwealth’s goal of promoting climate resilience in projects that receive valuable public resources.

- All pre-applications should include a short memorandum from the project sponsor setting for the sponsor’s experience in and ongoing commitment to M/WBE housing practices and listing M/WBE goals for the proposed project.

- All sponsors must submit a pre-application fee of $1,500 in the form of a check made out to HLC. The pre-application fee is non-refundable. HLC will not review any pre-applications unless the fee is received by HLC within two business days of the pre-application submission.

B. Qualified Conversion Project Application Process

EOHLC will accept applications from interested sponsors to certify Qualified Conversion Projects in the following manner:

(1) Project sponsors must submit a proposal to EOHLC on the form provided in Appendix D and must include the following information, which must be supported by independently verifiable documentation and signed under the penalties of perjury:

a. Identity of the project sponsor and evidence that the sponsor is legally empowered and entitled to make commitments required to undertake and complete the project, and shall include any affiliated successor in interest formed to undertake the project;

b. Evidence that the sponsor has site control;

c. Projected sources and uses;

d. Construction plans and specifications;

e. Development cost estimate prepared by a qualified third party;

f. Construction schedule;

g. Residential marketing strategies and plan including affirmative fair housing outreach;

h. Satisfactory evidence that the market rate residential units will be priced consistently with prevailing rents or sales prices for market rate units in the municipality, including a narrative and supporting data that describes the methodology for setting unit prices;

i. Evidence of municipal support for the project, including any municipal resources that have been committed to the project;

j. Narrative describing how the project will increase residential growth, increase diversity of housing supply, support economic development, and promote neighborhood stabilization;

k. Proposed number of residential units upon completion, broken down by market rate units and affordable units;

l. Proposed commercial or non-residential uses, if any;

m. Sponsor’s certification that the property was nonresidential real property under IRC §168 prior to the conversion of the property to residential use and all or a portion of the property was leased, or available for lease, to office tenants;

n. Sponsor’s certification that the building was placed in service at least five (5) years prior to beginning the conversion (the anticipated date when construction will commence).

(2) Under this NOFA, sponsors of eligible projects must submit the additional following threshold documentation:

a. Evidence that project costs will meet the AHA definition of eligible

Development Costs, which are expenditures directly related to construction or substantial rehabilitation of the Qualified Conversion Project, including, but not limited to, the cost of site assessment and remediation of hazardous materials. Development costs do not include the purchase or acquisition of the property.

b. Documentation of resources that have been committed to the project and that most, if not all, project funding sources other than CCTCI are in place; and

c. Evidence that the project submitted for CCTCI credits is highly ready to proceed to closing during CY 2027.

(3) EOHLC will evaluate the certification proposal and either grant or deny certification within 90 days from receipt of a complete application. However, sponsors should note that EOHLC’s failure to act within 90 days from receipt of a complete application does not constitute an approval of the project for the Commercial Conversion Program or eligibility for the Commercial Conversion Tax Credit.

(4) Sponsors also must pay the EOHLC required processing fee before EOHLC evaluates the required documentation.

C. Final Certification

If the project receives an award through the CCTCI competition, the sponsor must complete the project, then submit an application for final certification once statutory leasing or sales requirements have been met. The application for final certification can be submitted whenever the statutory requirements have been met.

D. Preference Criteria for Certification and Credit Awards

Before receiving a credit allocation, all sponsors must ensure that their projects have met the criteria for certification identified in Subsections A and B. However, project sponsors should note that, in 2026 EOHLC will only certify projects if EOHLC intends to award an allocation of the CCTCI to the project.

EOHLC will give preference based on the following when certifying projects in 2026:

• Documentation indicating that the municipality where the project is located was selected as a participant in the MassHousing Technical Assistance Initiative in support of commercial and/or office conversion; Sponsors should note that properties that have been identified by MassHousing’s Technical Assistance Initiative will receive preference consideration in this CCTCI competition (See Appendix A).

• Projects at Scale: Preference will be given to projects with more than 50 total residential units upon conversion. Please note EOHLC reserves the right to deny applications for projects with fewer than 25 residential units upon conversion.

• Diversity of Units: EOHLC will give preference to projects with a mix of bedroom types, including bedroom types suitable for families (2+ bedrooms).

EOHLC will not accept applications limited to studios and one-bedroom units.

• Local Contribution: EOHLC will give preference to projects whose sponsors have been able to secure financial contributions or other assistance from the municipality where the project is located.

• Sustainable Design: EOHLC will give preference to projects with important characteristics of green and sustainable design. Please refer to the 2025-2027 LIHTC Qualified Allocation Plan for more information.

E. CCTCI and Housing Development Incentive Program (HDIP)

Under this NOFA, EOHLC in its sole discretion may choose to accept a limited number of applications from sponsors of HDIP projects who already have secured HDIP awards or intend to apply for HDIP at the next available opportunity. Some HDIP projects, similar to some low-income housing tax credit projects, have been stalled by ongoing post-COVID impacts and by the recent federal actions of concern to the debt and equity markets. EOHLC intends to give CCTCI preference to a limited number of large- and very large-scale HDIP projects with the following characteristics:

• Project characteristics conform to the Commercial Conversion Program statute in AHA;

• Projects contain at least 50 units;

• Sources other than additional HDIP are in place; and

• Projects can close during CY 2027.

Once EOHLC certifies a project under this NOFA, based on minimum certification criteria and preference criteria, EOHLC will award an allocation of tax credits to the project.3

V. Tax Credit Award Limits: 2026

EOHLC intends to limit tax credit awards under this NOFA to no more than $3 million per project, based on project size. Per the AHA statute, the maximum credit award per project is 10% of eligible development costs.4 EOHLC also intends to issue no more than one award to a single development team and no more than two awards to a single municipality.

VI. Certification Process: Additional Information

As indicated in Section III, sponsors that intend to apply for CCTCI funds must follow a two-step process:

• The sponsor must submit a pre-application for funds. All pre-applications must be submitted to EOHLC-HDU@mass.gov no later than 5 p.m. on September 30 , 2026.

• If approved through the pre-application process, the sponsor must prepare a full application for submission to HLC no later than 5p.m. on November 13, 2026. All full applications must be submitted to EOHLC-HDU@mass.gov.

HLC intends to issue conditional award letters to sponsors with Qualified Conversion Projects within 90 days of the full application deadline.

3 Generally, an award of a credit is a formal acknowledgement that a particular taxpayer will be entitled to claim a tax credit upon completing certain tasks, whereas issuance is the actual receipt of the credit. See Section II of the most recent publicly available Massachusetts Tax Credit Transparency Report issued by the Department of Revenue.

https://www.mass.gov/lists/massachusetts-dor-tax-credit-transparency-reports#2022- 4 “Development Costs”, an expenditure directly related to the construction or substantial rehabilitation of a qualified conversion project, including, but not limited to, the cost of site assessment and remediation of hazardous materials;

provided, however, that development cost shall not include the purchase of the property. See M.G.L. c. 23B § 36 mailto:EOHLC-HDU@mass.gov mailto:EOHLC-HDU@mass.gov https://www.mass.gov/lists/massachusetts-dor-tax-credit-transparency-reports#2022-

APPENDIX A

MassHousing Commercial Conversion Initiative (CCI): Technical Assistance Communities

MassHousing received11 CCI technical assistance applications during fall 2024 from over 25 eligible communities. The following 11 communities were approved by MassHousing to participate in the initiative. Projects located in these municipalities are eligible to receive preference in EOHLC’s CCTCI funding competition:

Fitchburg Gardner Holyoke Lowell Maynard New Bedford Northampton Pittsfield Revere Spencer Springfield Worcester

Please note that projects can receive preference only if all threshold and program criteria are met.

APPENDIX B

CCTCI and HDIP Key Characteristics

CCTCI HDIP

Current Authorization $20million in CY2026

$30 million in CY2026

Eligible Sponsors For-profit and non-profit developers

For-profit and non-profit developers

Eligible Projects Adaptive re-use/rehabilitation preference; placed in service five years prior to construction;

other federal statutory restrictions

Refer to HDIP NOFA (new construction allowed)

Eligible Locations Any municipality. EOHLC will give preference to MassHousing commercial conversion technical assistance communities.

Gateways only

Likely Funding Limit $2.5-$3 million/project; scale of project a factor; statutory limits apply

$2.5-$3 million/project (possible exception for very large projects)

Required Municipal Approvals Sign-off by CEO Approval of HD zone; approval of TIE agreement

Municipal Contributions Strongly encouraged Strongly encouraged, although TIES are significant

Affordability Encouraged, but not mandatory: statute requires 80% market rate units

Encouraged, but not mandatory under state statute: statute requires 80% market rate units

Status of Zoning In place

In place preferred; underway required

Eligible Development Costs Refer to AHA statute Refer to HDIP NOFA

Claiming of Credits Post completion and substantial rent-up

Post completion and substantial rent-up (statutory)

Competitions in 2026 Two competitions Two competitions

APPENDIX C

Qualified Conversion Project Application - Instructions

• Please submit the Qualified Conversion Project application, budget and each exhibit as separate files.

• All sections in this Application should be completed with a summary explanation in the form and an attached exhibit. Please provide a summary in this document and then attach the relevant supporting information in the appropriate exhibit.

o For example, Label PDF files for exhibits clearly and by the exhibit number. Please label PDF attachments by exhibit number and name.

APPENDIX D

CCTCI – QUALIFIED CONVERSION PROJECT APPLICATION

1. PROJECT INFORMATION:

Name of Project:

Address of Project:

City: Zip:

CCTCI Request:

2. PROJECT SUMMARY:

3. PROJECT DESCRIPTION:

Development Plan (Conversion or demo/new construction):

Rental, Homeowner or both:

Most Recent Use (include S.F.):

Proposed Uses: Residential S.F.: Retail S.F.:

Total Number of Proposed Units: 1BR 2BR 3BR 4BR Number of Proposed Market Rate Units: 1BR 2BR 3BR 4BR Number of Proposed Affordable Units: 1BR 2BR 3BR 4BR

Site Control - Summarize here (e.g. P&S, deed, etc) and attach evidence in exhibits:

Zoning:

Environmental Information (Phase I, Conversion Commission, Chapter 91, and any other permitting):

Historic Information - Summarize here:

Relocation Plan, if necessary:

Amenities and Services:

4. DEVELOPMENT TEAM:

Sponsor:

Owner Entity:

Developer(s):

Development Consultant:

General Contractor:

Management Agent (Please note if the developer or related entity is also the management agent):

Syndicator (Please identify purchaser of CCTCI tax credits):

DEVELOPER EXPERIENCE AND CAPACITY: Describe relevant background and/or experience that demonstrate the capacity of the development team to successfully carry out the proposed project.

5. CONSTRUCTION PLANS AND SPECIFICATIONS:

6. CONSTRUCTION COST ESTIMATES:

TDC (including any commercial uses):

TDC (residential only):

TDC per residential unit:

7. CONSTRUCTION SCHEDULE:

Application Date:

Construction Loan Closing:

Construction Start:

50% Construction Completion:

Construction Completion:

First Certificate of Occupancy:

Last Certificate of Occupancy:

Permanent Loan Closing:

Other tasks:

8. APPLICANTS (signed under pain and penalties of perjury):

Name:

Address:

Email:

Phone:

Signature:

Date:

Title:

APPENDIX E

Exhibits to CCTCI Qualified Conversion Project Application o Exhibit 1: Project sponsor Identity of the project sponsor and evidence that the sponsor is legally empowered and entitled to make commitments required to undertake and complete the project, and shall include any affiliated successor in interest formed to undertake the project o Exhibit 2: Evidence of site control and zoning Provide evidence that the sponsor has site control.

o Exhibit 3: Construction plans and specifications Provide the construction plans and specifications o Exhibit 4: Development cost estimate Provide a development cost estimate prepared by a qualified third party o Exhibit 5: Construction schedule Provide the construction schedule o Exhibit 6: Projected sources and uses Use budget template provided by HLC or similar format. Include copies of commitment letters from other funding sources.

o Exhibit 7: Residential marketing and strategy plan Residential marketing strategies and plan including affirmative fair housing outreach o Exhibit 8: Pricing of market rate units Satisfactory evidence that the market rate residential units will be priced consistently with prevailing rents or sales prices for market rate units in the municipality, including a narrative and supporting data that describes the methodology for setting unit prices;

o Exhibit 9: Municipal support Evidence of municipal support for the project, including any municipal resources that have been committed to the project o Exhibit 10: Diversity of housing supply Narrative describing how the project will increase residential growth, increase diversity of housing supply, support economic development, and promote neighborhood stabilization o Exhibit 11: Proposed number of residential units

Proposed number of residential units upon completion, broken down by market rate units and affordable units o Exhibit 12: Proposed commercial uses, if any Describe proposed commercial or non-residential uses, if any.

o Exhibit 13: Certifications Sponsor’s certification that the property:

• was nonresidential real property under IRC §168 prior to the conversion of the property to residential use;

• all or a portion of the property was leased, or available for lease, to office tenants; and

• the building was placed in service at least five years prior to beginning the conversion.

o Exhibit 14: Additional Information

Including, but not limited to:

• Federal and state historic documents

• ASTM Phase I reports

Anticipated Calendar

NOFA Activity Date NOFA CB's Post Date: August 24, 2026 Pre-application due to HLC: September 30, 2026 - 5pm Q&A submittal deadline: October 5, 2026 Q&A response deadline: October 12, 2026 Qualified Conversion Project applications due to HLC: November 13, 2026 - 5pm Award (Estimated Award Announcement): February/March 2027