HIT Project: Older Boston Rental Property To Gain Rehab
- Jun 21, 2013
Boston—Preserving affordability and providing energy-saving retrofits are two goals of a project planned for Boston’s Georgetowne Homes One and Two. A significant source of affordable housing in Boston’s Hyde Park neighborhood for four decades, the aging property will get an infusion of $116 million in pension capital funding through the AFL-CIO Housing Investment Trust (HIT).
The AFL-CIO HIT is a fixed-income investment company registered with the SEC that manages $4.7 billion in assets for more than 360 investors, including union and public employee pension plans. The HIT invests for the most part in government and agency-insured and guaranteed multifamily mortgage-backed securities.
The HIT financing calls for $70.4 million to be earmarked for the 601-unit Georgetowne Homes One, built in 1969, and $45.5 million to be set aside for the 366-unit Georgetowne Homes Two, constructed three years later.
The rehabilitation is anticipated to require 645 union construction jobs, AFL-CIO Housing Investment Trust reports.
All 967 apartments at Georgetowne Homes are income-restricted. Seventy percent receive Section 8 project-based rental assistance. The property’s Section 8 contracts will be extended by the owner, Beacon Communities, as a provision of the HIT refinancing. What’s more, affordability will be preserved for another 45 years through a deed restriction.
New energy-efficient central heat and hot water systems top the improvements list. Additional enhancements will include window and siding replacement, energy-efficient appliances and improvements to insulation. All these upgrades will deliver substantial energy and maintenance savings, while helping make Georgetowne Homes a paradigm of sustainable affordable housing.
Financing was assembled through the HIT’s purchase of construction and permanent tax-exempt bonds and construction loan notes issued by MassHousing. Federal and state Low Income Housing Tax Credits, as well as other state and local subsidized debt, provided additional financing sources.
Including the Georgetowne Homes investments, the HIT has helped fund more than $1 billion in Boston housing development, representing 3,490 housing units and almost 4,700 construction jobs. That’s part of HIT’s commitment to Boston officials to address the city’s most vexing housing issues.
“It is particularly gratifying to work on the increasingly important long-term preservation of housing, specifically Georgetowne Homes,” says Tom O’Malley, a senior vice president who heads the HIT’s New England Regional Office. “[That’s] because it is the largest and most important preservation effort currently underway in the City of Boston and the Commonwealth as a whole.”
O’Malley characterizes the rehabilitation of Georgetowne Homes as proof of the HIT’s continuing dedication to teaming with MassHousing, the City of Boston and local developers to create and preserve housing affordability for the city’s low-income residents.