UDF is an affiliate of Aries Capital, LLC, specializing in the structuring and syndication of New Markets Tax Credits and other forms of government subsidies and incentives. Established in 2001 and qualified as a Community Development Entity (CDE) by the US Treasury, to date, UDF has received allocations of New Markets Tax Credits totaling over $620 million. UDF’s focus is on developing retail development, office space, industrial facilities, and community facilities in particularly economically distressed areas.
On December 21, 2000, the Community Renewal Tax Relief Act of 2000 was signed into law. This landmark legislation included the New Markets Tax Credit, which will spur the investment of $15 billion in new private capital into a range of privately managed investment vehicles that make loans and equity investments in New Markets businesses. By making an equity investment in an eligible “community development entity” (CDE), individual and corporate investors can receive a New Markets Tax Credit worth 39 percent of the amount invested over the life of the credit. By increasing their capital base, this tax credit enables CDEs to lend and invest more, to attract additional outside capital, and to bring even more private sector engagement to their market-priming activities.
UDF was formed in 2002 with the primary mission of serving low-income persons and low-income communities by utilizing the New Markets Tax Credit to spur private investment in underserved neighborhoods around the country. In that same year, UDF was certified as a Community Development Entity by the CDFI Fund, a department of the U. S. Treasury Department.
UDF utilizes the subsidy afforded by the New Market Tax Credit to offer more favorable rates and terms than would have been available to these projects in the marketplace. All of the UDF’s loans are flexible or non-traditional in some form including: below market interest rates, non-traditional forms of collateral, longer than typical amortization periods, or more flexible borrower credit standards.