FOR IMMEDIATE RELEASE
August 16, 2000
Press Contacts: Carol Abrams (212) 863-5176
Kim Brown (212) 863-8076
NEW YORK CITY HOUSING PROGRAMS NAMED
"BEST PRACTICES" BY FEDERAL GOVERNMENT FOR YEAR 2000
HomeWorks and StoreWorks Renew Economic Investment in Communities
The U.S. Department of Housing and Urban Development (HUD) has recognized two of New York City's homeownership and community development programs as Best Practices. The HomeWorks and StoreWorks programs were selected as two of HUD's 50 Best Practices for the year 2000, out of a pool of over 2,000 nominations nationwide.
HomeWorks and StoreWorks were created as part of the Giuliani administration's disposition plan to accelerate the sale and rehabilitation of City-owned buildings. Administered by the NYC Department of Housing Preservation and Development, both programs take distressed City-owned buildings and turn them into homes and, in the case of StoreWorks, thriving businesses for community residents.
"The success of these programs stems from the fact that they make high-quality rehabilitated homes affordable to moderate- and middle-income families, which in turn bolsters private economic activity that benefits all residents of the community," remarked HPD Commissioner Jerilyn Perine. "We are extremely proud that these important programs received Best Practice recognition from HUD."
In the first round of HomeWorks and StoreWorks, 699 dwelling units and 36 commercial spaces in the Bronx, Brooklyn, Manhattan, and Queens have been rehabilitated and sold. Round II is now underway, with 491 dwelling units and 61 commercial spaces currently in development.
Under the HomeWorks program, started in 1995, vacant one- to four- family, City-owned buildings are conveyed through a competitive Request for Proposals process to experienced developers at $1/building, then completely rehabilitated and sold to individual home buyers at market prices. The developers work with lenders to provide mortgages with low down payments, and the lenders use flexible underwriting standards to allow more rental income to qualify potential home buyers, which helps make homes affordable. Owners are required to live in the homes, increasing local investment in the neighborhood and improving homeownership rates in areas with low owner-occupant populations.
Building on the success of HomeWorks, the StoreWorks Program was started in 1997 to rehabilitate small, vacant, City-owned, mixed-use buildings and restore them to private ownership. These buildings generally contain a storefront at street level and one- to eight- residential units above.
Neighborhood Housing Services of New York (NHS) is the developer for StoreWorks projects, acquiring the buildings, securing financing from private lenders, overseeing design and construction, and marketing the buildings once they are complete.
By creating both affordable housing and places of commerce, StoreWorks not only strengthens private investment in a neighborhood, it gives the neighborhood tangible employment opportunities, increased livable housing stock, and increased accessibility to commercial services. "It's not just the fact that 34 buildings were rehabbed, but more importantly, over two dozen languishing commercial strips got a real shot in the arm with brand new storefronts and new businesses," said Francine C. Justa, Executive Director of NHS.
Integral to the success of HomeWorks and StoreWorks has been the financing of the projects by private lenders. The Bank of New York, EAB, and Greenpoint Bank are valuable community partners with HPD in the effort to rebuild New York City's communities. In Round I, financing by private lenders accounted for more than 70% of funding for HomeWorks projects and more than 50% of funding for StoreWorks projects, with HPD funding and Developer Equity covering the remaining costs.
HomeWorks and StoreWorks are two of a number of programs designed to prevent the problem of abandonment by identifying and attracting potential owners who have a desire to live in and invest in a revitalized neighborhood. By increasing homeownership in the City, these programs bring a healthy economic mix to neighborhoods which had been affected by abandonment in the 1970's and 1980's. In both programs, preference for 30-40% of the homes is given to residents of the communities in which the homes are located
HPD's mission is to promote quality housing and viable neighborhoods for New Yorkers. The department is the nation's largest municipal housing development agency. Since Fiscal Year 1994, the agency has completed the construction or rehabilitation of nearly 58,000 units of affordable housing.