LIHTC Developer Fee Calculator

LIHTC developer fees capped by state QAP, typically 10–15% of TDC.

Total development cost

Fee % of TDC

QAP cap %

Deferred %

Developer fee

$2,400,000

Current fee

$1,200,000

Deferred fee

$1,200,000

How the math works

Fee = min(TDC × fee %, TDC × QAP cap). Deferred = fee × deferred %.

$20M × 12% = $2.4M (under 15% cap). 50% deferred = $1.2M deferred, $1.2M current.

How to Use

Enter total development cost.
Enter fee % of tdc.
Enter qap cap %.
Enter deferred %.
Read developer fee.

Frequently Asked Questions

Developer fee QAP rules?

Most QAPs cap developer fee at 10–15% of TDC (total development cost). Some include capped overhead. Fee earned: 50% during construction, 50% at conversion. Often required to defer 50%+ behind investor pref. Eligible for inclusion in eligible basis (drives more LIHTC credit). Identity-of-interest contractor markups limited. Soft costs eligible for basis: most project costs, except land. Bonus depreciation conflict: some QAPs limit bonus depreciation election to preserve basis.

How does this asset class compare to traditional CRE?

Specialty assets (self-storage, RV parks, MHP, marinas, cold storage, data centers, parking, car wash, QSR/c-store, billboards, cell towers) typically offer higher cap rates than office/retail but with more operational complexity. They reward specialized operators with deep market knowledge. Lender pool is narrower, capital costs sometimes 50–150 bps higher, but downside resilience often better.

Capex and operational considerations?

Specialty assets often have heavier operational burden than passive triple-net retail. Self-storage, RV, MHP: tenant turn, security, basic upkeep. Marinas, parking, car wash: equipment-heavy with replacement reserves. Cold storage, data center: utilities are major cost. Billboards, cell towers: minimal opex, near-passive. Match management capacity to asset operational intensity.

Exit strategy?

Specialty asset cap rates have compressed significantly over last cycle but volatility is real. Buyers: REITs, private equity rollups, regional operators, 1031 buyers. Strong NOI history, environmental clarity (especially for car wash, gas station), and lease structure (for billboards, cell towers) drive valuation. Plan exit 24+ months in advance for best execution.