New owners to invest $52m improving Brooklyn complex.
The new owners will implement a $51.7 million redevelopment initiative at the low-rise, 6.3-acre site.
The Arker Companies and The Domain Companies--which both have extensive experience in affordable housing development--purchased the property from the original owner for $18.3 million. The acquisition received tax-exempt bond financing provided through the New York City Housing Development Corporation (HDC). The New York City Department of Housing Preservation and Development (HPD) facilitated the extension of the tax-exempt benefits.
"To preserve economic diversity, New York City needs workforce housing that is affordable," said Alex Arker, principal with The Arker Companies. "Our ability to help preserve affordability for New York's working families would not have been possible without the outstanding support of both NYC HDC president Emily Youssouf and NYC HPD Commissioner Shaun Donovan, and their respective teams."
"New York City has made an admirable and aggressive public policy commitment to creating and preserving affordable housing," said Matt Schwartz, principal with The Domain Companies. "By keeping Spring Creek Gardens affordable for decades to come, we are helping the city achieve its ambitious, workforce housing goals. Our company takes tremendous pride in delivering top-quality affordable housing for the people of Brooklyn."
The New York City Housing Development Corporation ("HDC") financed the rehabilitation work by issuing $24 million in tax-exempt bonds under the Corporation's Low-Income Affordable Marketplace Pro gram ("LAMP"). "HDC is proud to be helping hard-working families find housing in East New York," said Emily A. Youssouf, president of HDC. "We are committed to creating innovative financing methods to build and preserve affordable apartments in New York City. We are looking forward to doing more work in East New York."
As part of their improvement initiative, the new owners will incorporate a number of energy-saving measures that will both lower operating costs and help preserve natural resources. The energy conservation enhancements will be provided with assistance from the New York State Energy Research and Development Authority (NYSERDA), as well as the New York State Division of Housing and Community Renewal through its participation in the federal Weatherization Assistance Program. Both owners have gained national recognition for developing and redeveloping residential properties that incorporate state-of-the-art energy conservation features.
Additional improvements will include window, roof, interior kitchen and bath replacements and facade improvement.
The property was originally developed under New York City's 421(a) housing program, which gives tax abatements to new market-rate housing in Manhattan for the private construction and operation of affordable housing. The site also received federal low-income housing tax credits at the time it was developed.
The new owners will preserve affordability through the syndication of tax credits by CharterMac, which provided over $17 million in tax credit equity. Additionally, CharterMac, in partnership with Freddie Mac, provided $23 million in bond financing.
"The Spring Creek redevelopment project was a prime example of a true public-private partnership where resources from the NYHDC and the NYHPD were combined with resources from the private sector through tax-credit syndication and loan proceeds from Charter Mac Capital, which evidences the unwavering commitment to the preservation of affordable housing by Freddie Mac and CharterMac," said Timothy Leonhard, vice president with CharterMac Mortgage Capital who originated the transaction.
By maintaining affordability for at least the next 33 years, the owners are helping to meet the objectives of Mayor Michael R. Bloomberg's New Housing Marketplace Plan. The plan calls for the creation and preservation of affordable housing for 500,000 New Yorkers over the next ten years.
First opened in 1988, Spring Creek Gardens consists of four- and five-story buildings.
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|Publication:||Real Estate Weekly|
|Date:||Jan 3, 2007|
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