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Deals & Dealmakers

JV to keep $166M Bronx Mitchell Lama portfolio affordable

1880 Valentine Avenue

Rubin Schron’s Cammeby’s International Group has sold a 1,275 unit Bronx affordable housing portfolio for $166 million.

LIHC Investment Group (LIHC), Belveron Partners (Belveron) and Camber Property Group (Camber) acquired the eight-building package in a deal that included the assumption of Cammeby’s debt on the properties.

The Bronx Park portfolio is comprised of eight Mitchell-Lama buildings constructed in the 1970s and rehabilitated in 2014, with 1,275 residential units and 10 commercial spaces.

The units are affordable to low-income families earning 60 percent of area median income (AMI) many of which benefit from a Section 8 contract.

The new owners plan to make operational improvements to benefit the residents and secure the long-term future of the buildings as affordable housing.

Under the Mitchell Lama program, buildings constructed before 1974 are rent-stabilized upon leaving the program, the rent in newer buildings an immediately be raised to market-rate.

The new ownership group already owns a significant number of Mitchell-Lama housing across the City and said it is committed to preserving its latest acquisition for the long term as affordable housing.

“Assembling this portfolio with like-minded, mission-driven owners is a tremendous step toward preserving even more homes for working families in the Bronx,” said Andrew Gendron, principal of LIHC Investment Group.

“We want to thank all of our partners, both public and private, for supporting, preserving and expanding safe and affordable housing opportunities across the city.”

Louis A. Harrison, partner at Belveron Partners, added, “Affordable housing like this is part of the critical infrastructure of any healthy city.”

And Rick Gropper, co-founder and principal of Camber Property Group, added, “We’re proud to add Bronx Park to our growing portfolio of affordable housing throughout the City. Thanks to our public and private partners for sharing our commitment to protecting these 1,275 units for the families that need them.”

To finance the project, the JV partners assumed New York State Housing Finance Agency and Freddie Mac loans serviced by Citibank, N.A. and JLL Capital Markets.

The portfolio is broken into three phases. Phase one comprises of 408 units and eight commercial spaces located at 2111 Southern Blvd and 800-820 E 180th St.

Phase two includes 536 units at 1880 Valentine Ave, 2000 Valentine Ave, 1985 Webster Ave, and 2100 Tiebout Ave. Phase three consists of 331 units and two commercial spaces at 355-365 E 184th St and 333 E 181st St.

In 2017, Mayor Bill de Blasio launched a new Mitchell-Lama Reinvestment Program to protect the long-term affordability of the City’s remaining Mitchell-Lama developments.

Nearly 20,000 of the City-supervised co-ops and rentals in New York City’s Mitchell-Lama buildings have left the program since 1989.

With an initial investment of $250 million, the offers investors various financing tools to restructure debt, provide long-term tax benefits and fund critical capital repairs.

Most Mitchell-Lama developments, originally funded by the federal government, date from the 1950s and 1960s, and many now need significant rehabilitation work.

In addition to low-cost financing, the reinvestment program provides Mitchell-Lamas with extended property tax exemptions.

These tools help reduce operating costs, which in turn works to keep rents and maintenance fees low for residents.

In exchange for the benefits, property owners agree to keep the buildings affordable for at least 20 more years – extending their affordability for another generation.

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