AFL-CIO's HIT Fund to Invest $1B in NYC

NEW YORK CITY—The AFL-CIO Housing Investment Trust rolled out a $1-billion plan today to sustain and build affordable housing throughout the city's five boroughs.

In a related announcement, New York City Comptroller Scott Stringer reports that five New York City retirement systems will invest $150 million in pension capital in the AFL-CIO Housing Investment Trust. The five New York City Retirement Systems are: the New York City Employees' Retirement System; the Teachers' Retirement System of the City of New York; the New York City Police Pension Fund Subchapter Two; the New York City Fire Department Pension Fund Subchapter Two and the New York City Board of Education Retirement System.

According to a report released by the AFL-CIO HIT, the new $1-billion commitment to New York City will result in $2.6 billion in total economic benefit; 14,700 jobs across a number of industries, including 7,300 union construction jobs; $1 billion in personal income, including wages and benefits and $227 million in state and local tax revenue.

Earlier this year, the AFL-CIO HIT provided $8 million in capital for the refinance of Harry Silver Housing Cooperative in Brooklyn, allowing modernization and repairs at the six building, 288-unit complex. The HIT began its New York City Community Investment Initiative in 2002. Among its prior investments included $40 million towards the construction of the $896-million Weill Cornell Ambulatory Care Center, which is part of New York-Presbyterian Hospital.

Through September 2015, the HIT has invested nearly $900 million in 43 projects to create or preserve more than 31,000 units of housing, of which 96% are affordable or workforce housing, across the five boroughs of New York City. The total estimated value of these investments exceeds $5.7 billion, according to HIT, which has resulted in the creation of approximately 9,600 total jobs, including 4,830 union construction jobs.

New York's retirement systems' investment is part of the pension funds' "Economically Targeted Investments" program that generates risk-adjusted market rates-of-returns while promoting economic development within the five boroughs.

“When it comes to promoting affordable housing and generating new jobs in our city, Economically Targeted Investments are a crucially-important tool,” says New York City Comptroller Stringer, who is a trustee and investment advisor to the five pension systems. He adds that working with the AFL-CIO's HIT fund has been a “fiscally smart marriage of resources and housing policy.”

Stephen Coyle, the CEO of the AFL-CIO HIT, says the investment from the five New York City pension systems will help create and sustain 20,000 affordable housing units in the city.

“The HIT has invested union and public pension funds to provide market returns, while increasing the supply of affordable housing and creating union jobs in municipalities across the country,” he adds. “This investment will help us continue our substantial work in New York City.”

The new HIT seven-year New York City investment strategy will result in the preservation of 12,500 to 15,000 affordable housing units and the construction of 5,000 to 7,500 new housing units. The HIT also states that the fund will work with city and state agencies to finance and improve affordable public housing. The goal is for the HIT to finance more than 50,000 affordable units in the city during that seven-year period.