Fairstead, a real estate firm committed to the preservation of high quality housing, announced the financing of a 905-unit portfolio of subsidized housing across nine properties (49 buildings) in New York City.
Over the last six months, in nine distinct transactions, Fairstead restructured the $430 million portfolio with $310 million in HUD-insured financing.
The portfolio, located throughout Brooklyn and Manhattan, had been on the verge of conversion to market-rate housing.
Fairstead, the NYC Council Members who represent these neighborhoods, the Department of Housing Preservation and Development (HPD), and the Department of Housing and Urban Development (HUD) collaborated to rehabilitate and preserve the housing.
Fairstead entered into new regulatory agreements with HPD to ensure that all 905 units will remain affordable for at least the next 40 years.
The most recent transaction, which closed December 30, was a $46.4 million loan provided by Capital One and HUD for 680 St. Nicholas Avenue in Manhattan.
Fairstead completed a comprehensive renovation of the property last year and introduced a social services platform as well as amenities including a new community room and enhanced connectivity services for residents.
“Preserving affordable housing allows families to stay in their homes while giving new life to the buildings they live in,” said HPD Commissioner Louise Carroll.
“HPD is proud to work with Fairstead to rehabilitate hundreds of homes across nine properties, protecting this valuable housing, and giving New Yorkers the security of knowing they can afford to stay in their communities for years to come.”
Will Blodgett, co-founder and partner at Fairstead, credited NYC Council Members Laurie Cumbo, Carlos Menchaca, Bill Perkins, and Council Speaker Corey Johnson as well as HPD and HUD for their support of these transactions preserving affordable housing in their districts and jurisdictions.
Blodgett said, “Affordable housing continues to be a scarce resource in this country, especially in New York. Public-private partnerships are key to creating and maintaining this affordability and Fairstead is proud to work with city council members and agencies alike who recognize the importance of preserving these affordable units and Fairstead’s ability to bring about positive change. We are incredibly proud of the entire team, for without these partnerships, none of this would have been possible. We thank everyone involved and look forward to keeping these units as deeply affordable for at least the next 40 years.”
The portfolio includes properties in Sunset Park, Harlem, Crown Heights and Midtown West. It was financed with HUD-insured 223f loans, which allowed Fairstead to invest over $35 million to upgrade all buildings with a full interior renovation of units and common areas.
These renovations include: new cabinetry, countertops, tiling, low-flow fixtures in all kitchens and bathrooms, sustainability measures to significantly reduce utility costs, handicap accessibility improvements, infrastructure upgrades and improved security and connectivity.
“This administration is committed to the preservation of affordable housing, especially in such a densely populated region as New York City,” said Lynne Patton, HUD Regional Administrator for New York and New Jersey.
“Through the HUD-insured 223f loan program, $310 million was financed to renovate existing homes and ensure residents have access to the decent, safe and sanitary housing units they deserve.”
Fairstead’s design and construction team will lead the full tenant-in-place rehab. The team has already completed Plaza Apartments and St. Nicholas Manor Apartments. The remainder of the portfolio is under construction and expected to be completed in 2020.
The financing was arranged by the FHA teams at Truist, Greystone, Capital One, and Meridian Capital Group.