New York–Affordable housing has not been immune to the credit crunch, but some financial institutions, like Capital One Bank, are making the effort to help facilitate such developments. The McLean, Va.-based bank just announced that it will provide an aggregate $55.5 million for the construction of two affordable housing projects in New York City.
Capital One will supply an affiliate of Phipps Housing Group, a non-profit developer of low-income housing in New York, with a loan and investment package valued at $14.5 million for the development of the 76-unit Courtlandt Community in the Bronx. The funding comes in the form of an approximately $6.3 million construction loan and the purchase of 9 percent Low Income Housing Tax Credits (LIHTCs) totaling $8.2 million. The 12-story structure will include studio residences for formerly homeless individuals suffering from mental illness or chemical addiction, as well as 3,000 square feet of common space.
Another project in the Bronx will benefit from funding through Capital One. A joint venture involving Jackson Development Group and Joy Construction Corporation is developing two structures featuring 161 affordable housing residences at the 641-unit St. Ann’s Terrace mixed-income residential development (pictured), and Capital One has committed to providing the team with $41 million in financing. The buildings, encompassing a combined 164,000 square feet, will offer residences ranging from studios to three-bedroom units for households earning between 40 percent and 60 percent of the area median income. Capital One will make $24.1 million available as a construction period credit enhancement via a stand-by letter of credit for tax-exempt, fixed-rate bonds issued by the New York City Housing Development Corporation’s Low-income Affordable Marketplace Program. The bank will bestow the remaining $15.3 million of the financing package through the purchase of 4 percent as-of-right LIHTCs.
These loans and investments are not only helping to provide housing for hundreds of individuals and families in need but they also translate into hundreds of local jobs and contribute to the overall growth and prosperity of the community,” Fabian Ramirez, Director, Community Development Finance at Capital One, tells MHN.
Capital One is no stranger to partnering with developers on affordable housing ventures. “Last year, we continued to support the development of affordable rental housing through the most challenging economic times by providing $716 million in specialized financing for more than 120 properties containing more than 7,500 housing units,” Ramirez says. “This year, we have increased that pace and continue to look for new business.”
The bank’s participation in such pursuits fits with a major New York City initiative. Mayor Michael R. Bloomberg’s New Housing Marketplace Plan calls for the creation or preservation of 165,000 units of affordable housing by 2014, and as of April, 100,000 units had been financed to the tune of $4.5 billion in city funding.