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Wheelock joint venture acquires 1,009-unit NJ housing portfolio for $180M

Hudson Valley Property Group LLC and Red Stone Companies, LLC, in joint venture with Wheelock Street Capital, acquired 1,009 units of New Jersey senior and family affordable housing located throughout northern New Jersey.

The seven properties are subsidized through US Department of Housing and Urban Development project-based Section 8 contracts.

The acquisition is the first phase of a long-term preservation plan that will include thoughtful and sustainable upgrades to the properties in the years to come.

HVPG is a New York City based affordable housing preservation firm. Red Stone was responsible for securing the debt financing and worked closely with HVPG to assemble the capital stack for the transaction. Wheelock Street Capital provided the majority of the equity capital. The debt was funded by utilizing a unique financing facility structured by Walker & Dunlop and Fannie Mae.

The NJ-based property management company, Community Realty Management, assumed operations while retaining a majority of the existing management staff at each of the sites.

This transaction, which was valued at over $180 million, demonstrates a creative financing execution to preserve New Jersey’s aging supply of affordable housing without relying on limited state public funds.

The properties are located in the towns of Hazlet, East Orange, Metuchen, Old Bridge, Orange, Windsor and Paterson. It is estimated that portfolio houses a total of 2,500 residents.

The joint venture plans to hold the properties long-term and pursue renovations and sustainable upgrades based on the physical needs at each of the sites.

“The previous owners built an impressive organization and team providing much needed affordable housing throughout New Jersey. We are excited to have the opportunity to carry on their legacy, and to preserve these properties for decades to come. We look forward to working closely with NJHMFA, HUD and the management staff to maintain each of the properties as quality affordable housing for these New Jersey communities.” Jason Bordainick, Managing Partner, Hudson Valley Property Group.

“Red Stone has always strived to develop creative solutions for our partners and clients specifically focused on investment in affordable housing communities. In this case, we are especially excited to have leveraged our relationship with Walker and Dunlop and Fannie Mae to structure and participate in a flexible multiple-party debt/equity capital stack to maximize the opportunity on this acquisition and preservation of over 1,000 affordable housing units in the State of New Jersey.” Brian Renzi, Managing Director, Red Stone Companies, LLC.

The portfolio was listed and brokered by SVN AFFORDABLE | Levental Realty and the transaction was led by Managing Director, Gene Levental and Senior Advisor, Jamie Renzenbrink. The law firms of Nixon Peabody, Berman Indictor and Goodwin Procter represented the joint venture in the transaction.

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