What are the performance indicators that MHDC looks at when approving, reducing, or denying a rent increase?
The two main performance indicators MHDC looks at when approving rent increases are cash flow and DCR. MHDC considers a health property to maintain a 1.20 DCR. Any budget that projects a property to exceed a 1.20 DCR may have their rent increase reduced or denied. Higher DCRs may be allowed for properties to achieve their agreed upon owner distribution and re-pay surplus cash notes and remaining deferred developer fees. In any event, MHDC will not approve an increase that is more than 7% or the Social Security COLA adjustment %.
