Summit Housing Snaps Up, Revamps Katrina-Damaged Property in New Orleans
- Dec 13, 2011
New Orleans—Six years after Hurricane Katrina devastated New Orleans, progress has been made in replenishing the city’s affordable housing stock, but full recovery is still not at hand. Summit Housing Partners has certainly been doing its part to move the effort forward. The multifamily housing owner and manager recently wrapped up the $8.5 million rehabilitation of Garden Oaks Apartments, effectively returning 98 residences to the market.
Garden Oaks sits in the city’s West Bank, a neighborhood, which incurred an inordinate amount of destruction when the hurricane hit. The apartment community came to Summit’s attention and the company moved into action. “We were originally approached by a local resident about it, “Rainer Andrews, assistant vice president of acquisitions with Summit, tells MHN. “We saw a vision for it, that this property could be a great property in that, number one, it would really do some good work for the neighborhood. A lot of buildings there were hit hard by Katrina. We thought that it would be a good property to try to reinvigorate the neighborhood. Also, it would fit into our portfolio and we saw a lot of opportunity to just turn it around.”
And turn it around Summit did. Relying on a great deal of creativity, the company secured a financing package for the project that included federal tax credits, Federal Home Loan Bank Affordable Housing Program funds and tax-exempt financing, The $9 million tax-exempt bond issue is credit enhanced by the Federal Housing Authority. A bevy of entities participated in the effort. “It was very unique how we ended up financing this,” he says. “Our team did a great job. It was really quite fascinating how all the structures came together.”
And that is how Garden Oaks went from little more than damaged beams to a quality affordable apartment community. Garden Oaks is one of several Katrina-ravaged properties in the New Orleans area that Summit has rescued. Its first rehabilitation project was the Richfield, a Section 8 property that the company purchased roughly five months after the hurricane.
Summit has every intention to continue to help fill a void in a community where options for low-income households were drastically reduced as a result of the natural disaster. “Housing is unaffordable for renters and homeowners in post-Katrina New Orleans at rates much higher than the nation or the surrounding suburb,” as noted in a study released by the Greater New Orleans Community Data Center and the Brookings Institution. “Renters in the city have historically struggled to afford housing costs, largely due to lower incomes. Housing affordability worsened for renters within the city after Katrina, such that city renters are much more likely than suburban renters to pay at least 35 percent of their household income on housing.”
New Orleans continues to play catch-up, and companies like Summit are playing a large role in residents’ pursuit of a renewed city with housing for all. “I think housing is going to be a long-term issue in New Orleans,” Andrews says. “The best way I can describe it down there is it’s incredible how much work and how much the residents down there have accomplished in terms of housing, but there’s still a lot of work to do and a long way to go. When you lose this much housing as New Orleans did, it’s just going to be a long struggle to get it back together.”
Garden Oaks most certainly will not be the Summit’s last redevelopment project in the city. “We’re going to continue to invest in the New Orleans, Southern Louisiana, Gulf Coast area. We think it’s got all the dynamics for long term growth and success.”