Fairstead Leverages Private-Public Partnership to Finance Prized Affordable Housing Portfolio
Fairstead has financed a 905-unit portfolio of subsidized housing in Manhattan and Brooklyn. The nine properties include 49 buildings, which were slated to get converted to market-rate housing before the firm swooped in.
NEW YORK CITY – Fairstead, a real estate firm specializing in affordable, mixed-income, and market-rate housing, has financed a 905-unit portfolio of subsidized housing in Manhattan and Brooklyn. The nine properties include 49 buildings, which were slated to get converted to market-rate housing before the firm swooped in.
Fairstead in collaboration with New York City Council members, the Department of Housing Preservation and Development, and the Department of Housing and Urban Development executed the new financing to ensure the properties remain affordable over the next 40 years. Fairstead also committed to new regulatory agreements with HPD for the 905-units.
“Preserving affordable housing allows families to stay in their homes while giving new life to the buildings they live in,” said HPD Commissioner Louise Carroll in a prepared statement. “HPD is proud to work with Fairstead to rehabilitate hundreds of homes across nine properties, protecting this valuable housing, and giving New Yorkers the security of knowing they can afford to stay in their communities for years to come.”
Financed with HUD-insured 223f loans, Fairstead was allowed to invest over $35 million to upgrade all buildings with a full interior renovation of units and common areas. These renovations include new cabinetry, countertops, tiling, low-flow fixtures in all kitchens and bathrooms, sustainability measures to significantly reduce utility costs, handicap accessibility improvements, infrastructure upgrades and improved security and connectivity.
The FHA teams of multiple lending partners, including Truist, Greystone, Capital One, and Meridian Capital Group arranged the financing. “Through the HUD-insured 223f loan program, $310 million was financed to renovate existing homes and ensure residents have access to the decent, safe and sanitary housing units they deserve,” said Lynne Patton, HUD regional administrator for New York and New Jersey, in a prepared statement.
Fairstead’s design and construction team will lead the full tenant-in-place rehab. The team has already completed Plaza Apartments and St. Nicholas Manor Apartments. The remainder of the portfolio is under construction and is dated for completion in 2020.
Fairstead most recently closed on a $46.4 million Capital One loan and HUD for 680 St. Nicholas Ave. in Manhattan. Fairstead completed a comprehensive renovation of the property last year and introduced a social services platform and amenities, including a new community room and enhanced connectivity services for residents.
“Affordable housing continues to be a scarce resource in this country, especially in New York. Public-private partnerships are key to creating and maintaining this affordability and Fairstead is proud to work with city council members and agencies alike who recognize the importance of preserving these affordable units and Fairstead’s ability to bring about positive change,” said Will Blodgett, co-founder and partner at Fairstead, in a prepared statement.