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In NYC: Building Affordable, Workforce Housing

By richmangroup,

In the Big Apple, finding an affordable home that’s near public transit can feel like finding a needle in a haystack.

So it’s good news that a new 550-unit apartment building is being built in Queens right by a huge transit station to house mixed-income residents, many of whom have low to moderate incomes.

The Crossing at Jamaica Station is workforce housing that will replace a run-down property to serve the needs of the community.  It’s happening because of an innovative partnership with the lender RICHMAC Funding LLC, New York City Housing Development Corporation (HDC), and Freddie Mac. The Borrower entered into a Brownfield Cleanup Program grant to help transform the blighted site.

Freddie Mac provided $158 million in an unfunded forward commitment for a bond credit enhancement.

The deal structure really helped the Borrower save money by using privately placed, floating rate bonds which do not require an expensive liquidity facility. This worked because an institutional investor, the Federal Home Loan Bank of New York, purchased the bonds issued by HDC.

“Freddie, as we’ve come to expect, your partnership in getting this done was incredible,” said RICHMAC Funding President Matthew Wambua, commenting on the team and the “extremely complex structure.”

The deal offers an affordable way for tenants to live in a high-end building. The 26-story complex will feature great views, with underground parking and retail on the first floor. The amenities include those more typical of a luxury community, such as a fitness center, children’s playroom, resident lounge and a large outdoor terrace on the 25th floor.

Making It Affordable

Nearly 17 percent of the units are affordable to low income residents, while almost 28 percent are workforce housing.  In addition, incomes for market rate tenants are capped at 165 percent of Area Median Income (AMI).

  • 90 units at 57% AMI or less (affordable or low income)
  • 100 units at 125% AMI or less (workforce or moderate income)
  • 49 units at 130% AMI or less (workforce or moderate income)
  • 299 units capped at 165% AMI (market rate)

Getting around in a busy place like NYC can be difficult. With the transit station right next to The Crossing, residents will find it easy to get to Manhattan, Brooklyn, Queens, or the airport with relatively few if any transfers—making this development ideal for workforce housing.

The project is considered a critical component of NYC Mayor De Blasio’s affordable housing plan, and is being developed with the Housing Plan’s Inclusionary Housing Program and middle-income program.  The Developer, BRP, worked closely with the New York City Housing Development and Preservation Department and HDC.

In addition to HDC issuing bonds, the two agencies will provide more than $54 million in subordinate, subsidized loans—a significant capital contribution showing the city’s considerable commitment. The project also secured a 40-year full tax abatement to help get it built. The project exemplifies how various funding sources can successfully come together to make affordable housing projects possible.

 

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RICHMAC Funding provides $360M in affordable housing loans

By richmangroup,

RICHMAC Funding LLC (RICHMAC), a national multifamily housing mortgage lender and an affiliate of The Richman Group of Companies (Richman), announced today that it provided over $360 million in loans in 2016 to develop nearly 4,000 units of affordable housing across the country.

This is only the second full year of operations for RICHMAC as a Freddie Mac, FHA, and Fannie Mae lender.

It is managed by Mathew Wambua, former commissioner of the New York City Department of Housing Preservation and Development.

 

RICHMAC’s loans support new construction, preservation and acquisition loans for low-income properties, including 2,900 units of extremely low-income housing, and mixed income development.

The lender has become know for its work with complex, highly structured deals with numerous public and private counterparties.

“We are thrilled to have come out the gate strong and proud to have worked with mission-driven clients across the country, from New York to California, to fund affordable housing development,” said Mathew Wambua, managing director, RICHMAC Funding.

Properties closed on in 2016 have over $800 million in development costs and include:

Crossing at Jamaica Station, Queens; developed by BRP Companies with 539 mixed income units

New Settlement Apartments, Bronx; developed by Settlement Housing Fund, Inc. with 454 affordable units

Carmen Parsons & Judge Gilbert Ramirez, Bronx; developed by New Vision Community Redevelopment with 194 affordable units

Grace Towers Apartments, Brooklyn; developed by Omni New York, LLC with 168 affordable units

Plaza Residences, Brooklyn; developed by Omni New York, LLC with 385 affordable units

John Paul II Apartments, Bronx; developed by New York Catholic Homes, Inc. with 69 affordable units

Target V Apartments, Bronx; developed by Omni New York, LLC with 83 affordable units

In 2016 RICHMAC also supported the development of five affordable housing developments with nearly 540 units across Texas, a 302-unit development in Los Angeles, 160-unit building in Columbus, Ohio, a 130-unit development in Puerto Rico, and nearly 400 units in Yonkers, NY.

“Richmac has come out of the gate very quickly. I think a lot of their early success relates to their ability to come up with outside the box solutions to difficult problems while working on highly complex deals which have significant public and private counterparty involvement.” said Chuck Brass, partner, Forsyth Street, a real estate and consulting firm.

RICHMAC is working on expanding significantly during 2017, broadening its geographic reach, diversifying its core products to reach an even broader set of needs for affordable housing developers, and continuing to grow all their GSE platforms.

“Having the Richman brand support us has enabled us to do more and we are looking forward to an even more successful 2017,” concluded Wambua.

 

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