HRI Secures $87M Financing for Boston-Area Community
- Aug 05, 2020
Homeowners Rehab Inc., a Cambridge, Mass.-based nonprofit organization, has received $87.2 million in financing from MassHousing for the modernization and preservation of affordability housing at the 300-unit 808 Memorial Drive multifamily community in Cambridge. The MassHousing financing will enable HRI to extend affordability protections by at least 15 years and to make substantial property renovations.
MassHousing provided HRI with a $61.5 million tax-exempt construction loan and permanent loan, $24.9 million in taxable and tax-exempt credit equity bridge financing and a $787,763 interest reduction payment (IRP) loan. The project will also use $8.9 million of income during the construction period for development costs. The transaction also involved $36.9 million in equity financing from an allocation of Low-Income Housing Tax Credit tax credits by the Massachusetts Department of Housing and Community Development. The LIHTC tax credits were syndicated by RBC.
Located at the intersection of Memorial Drive and River Street along the Charles River, there are 89 apartments in a 10-story building at 808 Memorial Drive and 211 apartments in a 19-story building at 810-812 Memorial Drive. The properties also have office and commercial space and 808 Memorial Drive has a first-floor daycare center. Of the 300 apartments, 212 will be supported for 15 years by a federal Section 8 Housing Assistance Payment contract for lower-income residents and administered by the Cambridge Housing Authority (CHA). The remaining 88 apartments are rented at market rates. There are 128 one-bedroom units, 138 two-bedroom units, 30 three-bedroom apartments and four four-bedroom apartments.
Chrystal Kornegay, MassHousing executive director, said in a prepared statement the apartment community was originally built to advance Cambridge as inclusive and welcoming to residents of all means. She said the MassHousing transaction will ensure HRI’s vision for the property continues well into the future.
Improvements planned for the property include new windows, balcony doors, kitchens and bathrooms in some of the units as well as landscaping, paving and fire alarm upgrades. The building exteriors will receive new cladding to improve energy efficiency. Construction is expected to be completed by the end of 2022. The general contractor is NEI General Contracting. The architect is Bruner Cott and the management agent is Wingate Management.
MassHousing has financed or manages the rental subsidy on 14 rental housing communities in Cambridge, involving 2,141 units and $475.6 million in financing. The agency has also provided home mortgage financing to 551 homeowners in Cambridge with $68.5 million in financing. In June, MassHousing provided a $43.7 million tax-exempt permanent loan and a $1.2 million tax equity bridge loan, to an affiliate of the CHA, for the Daniel F. Burns Apartments, a 198-unit community in Cambridge.
The MassHousing financing is generating $36.8 million in federal LIHTC equity. As part of the transaction, the apartments—which serve low-income seniors and residents with disabilities—remain affordable for at least 20 more years. In March, MassHousing, in partnership with Greystone, provided Pennant Housing Group with a $9.9 million acquisition and construction loan for an affordable, 89-unit senior community in Weymouth, Mass. The transaction also maintains the property’s affordability for at least 15 more years.