FOR IMMEDIATE RELEASE
August 17, 2009
MAYOR BLOOMBERG, GOVERNOR PATERSON AND U.S. DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT ANNOUNCE NATION'S FIRST HOUSING DEVELOPMENTS TO START CONSTRUCTION USING TAX CREDIT ASSISTANCE PROGRAM STIMULUS FUNDS
First Four Developments Will Comprise 739 Units of Affordable Housing in Harlem and East New York, and Create More than 2,800 Construction jobs
Building Affordable Housing in Neighborhoods across New York City is a Central Component of the Bloomberg Administration’s Five Borough Economic Opportunity Plan
Mayor Michael R. Bloomberg and Governor David A. Paterson today announced that New York City is first City in the nation to begin construction of new affordable housing using funds from the American Recovery and Reinvestment Act’s Tax Credit Assistance Program (TCAP). Four housing developments – three in Harlem and one in East New York – will comprise 739 units of affordable housing and their construction will provide more than 2,800 construction jobs. The Tax Credit Assistance Program aims to increase the supply of newly constructed or recently renovated affordable housing units that otherwise would not have come to market due to current economic conditions. The $60 million in stimulus funding spent on the first four developments accounts for more than 70 percent of New York City’s Tax Credit Assistance Program allocation. Building affordable housing in neighborhoods across New York City is a central component of the Bloomberg Administration’s Five Borough Economic Opportunity Plan to create jobs for New Yorkers today, implement a vision for long-term economic growth and build affordable, attractive neighborhoods. The announcement was held at the East Harlem site for one of the housing developments, Hobbs Court, where the Mayor was joined by Council Member Melissa Mark-Viverito, Department of Housing and Preservation and Development Commissioner Rafael E. Cestero, New York City Housing Authority Chairman John B. Rhea, New York State Division of Housing and Community Renewal Commissioner Deborah VanAmerongen and Phipps Houses President and CEO Adam Weinstein.
“New York City is the first city in the nation to put stimulus for housing projects to use, and that means real jobs and affordable housing for New Yorkers,” said Mayor Bloomberg. “Thanks to New York City’s congressional delegation, the City received tens of millions of dollars to revive stalled affordable housing projects, and we’re putting it to use to provide affordable housing for more than 700 families and create more than 2,800 jobs for New York City’s construction workers, architects, engineers, electricians, plumbers, and others who have been hit hard by the recession. I want to thank both HUD Secretary Donovan and Governor Paterson, who continue to be key partners as we put stimulus funds to work.”
“Today’s announcement demonstrates that the Recovery Act is working now to jumpstart the nation’s ailing economy,” said U.S. Housing and Urban Development (HUD) Secretary Shaun Donovan. “The TCAP program is significantly boosting our efforts to put the American people back to work, right here in New York City, while at the same time providing quality, affordable housing options for low-income families at a time when those options are critical.”
“New York is a leader in addressing the affordable housing crisis and rescuing construction and rehabilitation projects jeopardized by the economy,” said Governor Paterson. “Thanks to the efforts of the entire New York congressional delegation, we successfully fought to make affordable housing a priority in the stimulus package and were the first state in the nation to commit Economic Recovery funds to stalled developments. Congratulations to Mayor Bloomberg and the City of New York. These grants will begin making an immediate difference in communities, creating housing options, jobs opportunities, and a better future for the people of New York City and the entire state.”
Under the Recovery Act, the Tax Credit Assistance Program provides grants through a formula-based allocation to State housing agencies. The funds are helping jumpstart the market for construction of affordable housing by providing financing for the acquisition and construction of buildings for affordable housing. HUD awarded $2.25 billion in TCAP funding nationwide. Of the $250 allocated to New York State, New York City received $85 million. New York City is spending roughly $60 million of that to help finance the four developments now underway.
One of the developments is located on two separate sites in Harlem, formerly known as Metro North. On an East 102nd Street site, where the announcement took place, 12 deteriorated walkup buildings will be demolished and replaced by a nine-story building to be known as Hobbs Court. The new building will offer 259 residential apartments, community facility space and underground parking. On an East 100th Street site, five vacant six-story buildings will be substantially rehabilitated and combined into a single building to be known as The Ciena. The building will contain 81 new residential apartments, elevators and landscaped open space for the residents.
The two buildings, developed through a joint venture between Phipps Houses and Urban Builders Collaborative, will be completed in the fall of 2011. All the units in this development will be permanently affordable to households with incomes up to $46,080 for a family of four and up to $32,280 for a single person. The total development cost of the project is $143.5 million. The New York City Housing Development Corporation is contributing $21.7 million and a loan of $71.4 million for the construction of the project, supported with a letter of credit provided by JPMorgan Chase and Bank of New York Mellon. In addition, JPMorgan Chase, acting through a placement by Richman Housing Resources, will invest $38.8 million in Low Income Housing Tax Credit equity to pay down the construction loan at permanent conversion. Phipps Houses will invest $1.9 million of its own funds as equity and will advance $700,000 provided by the New York State Energy Research and Development Authority to make energy-saving enhancements.
The Hobbs Court and Ciena sites were Federal Housing Administration-foreclosed properties that were transferred to NYCHA in the late 1980s. Since then they have been operated as Project Based Section 8 housing for NYCHA residents. In 2003, NYCHA began voluntary relocating residents in preparation for redevelopment. All qualified former residents will have the opportunity to return to the project at its completion. NYCHA will receive annual lease payments for the property which will be used to help modernize and preserve public housing throughout the City.
“The creation and preservation of affordable housing is critical to my district and our city, especially in the midst of the current economic crisis,” said Council Member Mark-Viverito. “Hobbs Court and The Ciena will create hundreds of new, permanently affordable apartments for lower- and middle-income New Yorkers, as well as hundreds of new jobs. I am proud that El Barrio/East Harlem stands as among the first neighborhoods in the nation to benefit from new affordable housing financed by the Recovery Act. I will continue to work with Mayor Bloomberg to explore opportunities for both affordable housing creation and Recovery Act-supported projects in District 8.”
“The Tax Credit Assistance Program has been a crucial tool as we continue to move forward aggressively with the Mayor’s New Housing Marketplace Plan – the largest municipal housing plan in the country. In Fiscal Year 2009 alone, HPD and HDC started construction on 12,500 units of housing, a truly remarkable accomplishment in today’s economic climate.” said HPD Commissioner Cestero. “Hobbs-Ciena exemplifies this achievement – its 340 units of permanently affordable housing will house many generations to come. This is critical for the economic stability of the neighborhoods and families we serve. It is also a testament to the power of all levels of government pulling together to respond to the housing concerns of our time.”
“Despite the turbulence in the capital markets, the New York City Housing Development Corporation has continued to meet its goals under the Mayor’s housing plan, financing new affordable housing, preserving existing affordable developments, strengthening neighborhoods throughout the City, and in the course of it all generating jobs for New Yorkers,” said Housing Development Corporation President Marc Jahr.
“Building new housing in Harlem is something everyone associated with today’s projects can truly be proud of,” said NYCHA Chairman Rhea. “But this is more than creating 340 units of affordable housing. It is an opportunity to create much-needed jobs for this community to build that housing.”
“The Low-Income Housing Tax Credit Program is a critical tool for creating affordable housing, but the economic crisis has made it difficult to use this program to its full potential,” said DHCR Commissioner Deborah VanAmerongen. “Governor Paterson was the first Governor in the nation to propose that funding to boost affordable housing development and preservation be included in the economic recovery package. The Tax Credit Assistance Program will get stalled projects up and running and create quality affordable housing and stronger neighborhoods throughout New York City and the entire state.”
“Phipps Houses is very pleased to have worked with the State, the City, HDC and NYCHA to close this complicated and path-breaking development known as Hobbs Court and The Ciena. We also applaud the efforts of Council Member Melissa Mark-Viverito on behalf of her constituents, helping us provide brand new homes with green and sustainable elements on this former Metro North development,” said Phipps Houses President and CEO Adam Weinstein. “The TCAP funds show that New York is leading the nation in housing policy and implementation. As New York’s and the nation’s oldest not-for-profit housing organization, Phipps Houses understands that being the first of its kind always requires creativity and perseverance, and we were duly impressed with the ingenuity of our partners in government.”
In addition to the Hobbs Court-Ciena development, three other developments are getting Tax Credit Assistance Program financing. Two of them, the Balton and the Douglass, are located on West 127th Street. The Balton, a $68 million project, will provide 156 affordable housing units. The Douglass, a $33 million project, will provide 70 units. Livonia Terrace, a $25 million construction project on Alabama Avenue in East New York, will provide 173 affordable units.
The Bloomberg Administration’s Five Borough Economic Opportunity Plan is a comprehensive strategy to bring New York City through the current economic downturn as fast as possible. It focuses on three major areas: creating jobs for New Yorkers today, implementing a long-term vision for growing the city’s economy, and building affordable, attractive neighborhoods in every borough. Taken together, the initiatives that the City has launched to achieve these goals will generate thousands of jobs and put New York City on a path to economic recovery and growth. To learn more about the plan, visit nyc.gov. Recent announcements include:
Stu Loeser / Andrew Brent (212) 788-2958
Marissa Shorenstein (Governor) (212) 681-4640
Eric Bederman / Miriam Solis (HPD) (212) 863-5176
Howard Marder (NYCHA) (212) 306-3322
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