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NEW YORK CITY-The boards of the New York State Housing Finance Agency and the New York State Affordable Housing Corp. have approved nearly $719 million in financing to create and preserve 1,802 units of affordable housing in New York City. A source close to the agency tells GlobeSt.com that the financing will go towards housing in Manhattan, Queens, Brooklyn and the Bronx. “Together, they will protect existing affordable housing and create new affordable housing–both homeownership and rental–for thousands of New Yorkers. That in turn will strengthen neighborhoods and help grow the economy throughout the city.”

The source explains that the financing comes from three sources. “The major source is tax-exempt bonds. We sell bonds and use the proceeds to give mortgages to developers to build new housing and preserve existing housing. In some cases, we also provide secondary mortgages to developers from our own internal resources. And the third source is appropriations made by the Legislature and the Governor in the state budget. These appropriations go to AHC, which gives grants to developers to subsidize new construction.” The source further notes that each recipient–whether it is a developer or nonprofit organization—”comes to us with a request for financing, which they determine based on the size and nature of their project and the resources they have put together from other sources.”

Among the projects receiving financing are the first three multifamily 80/20 rental projects to be approved under HFA’s new 2008 allocation criteria for private activity tax-exempt bond financing, also known as “volume cap.” These multifamily developments must agree to set aside 20% of the units for low-income tenants and also satisfy several other criteria, including construction and finance readiness, compliance with New York City planning goals and commitment to energy efficiency.

HFA revised its 80/20 volume cap criteria in January because demand for tax-exempt bonds greatly exceeds the amount of volume cap authority available to New York State under Federal law. The bonding authority approved today will be spread over the next three years as the developments are built.

HFA also approved financing for major renovations at two Mitchell Lama projects in the city under the agency’s Mitchell Lama Rehabilitation and Preservation program. Under the program, which is designed to protect Mitchell Lama tenants, owners receive renovation financing and agree to keep rents affordable for the next 40 years.

The source tells GlobeSt.com that renovation timetables for the preservation projects are determined by the owners. “We will close on our mortgage in the next month or two. In most cases, tenants are not relocated. Most renovations take place over several months and some renovations can take more than a year to be completed.”

Priscilla Almodovar, president and CEO of AHC and HFA, who is in charge of fetermining which projects to finance, says in a prepared statement that “the financings we approved demonstrate the great diversity of housing in New York City. Whether it’s financing market rate housing in Manhattan, providing for affordable co-ops in Brooklyn or preserving Mitchell Lama projects in Queens, ‘nyhomes’ is supporting the wide of variety of housing needs demanded by the city’s residents.”

The largest financing of Manhattan projects includes the following:

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