A nearly $200 million investment of public and private funds financed the renovation of 468 apartments and will finance the creation of 242 new affordable homes for low-income families
Goldman Sachs provides over $90 million of financing to revitalize underserved community; Red Stone Equity Partners, Capital One and JP Morgan Chase together finance new construction as part of Phase II of Livonia Initiative
September 26, 2016
By NYCHDC -September 23, 2016
(Brooklyn, NY) – (RealEstateRama) — East New Yorkers celebrated the completion of the rehabilitation of 468 homes and the start of construction on 242 affordable apartments today. BRP Companies is the lead on both of the new construction and the preservation projects which have a combined total of 710 units of affordable housing. In addition to much-needed affordable housing, the new construction project will create 30,000 square feet of community and retail space to enrich the East New York Community. All work is being completed through a partnership with the New York City Department of Housing Preservation and Development (HPD) and the New York City Housing Development Corporation (HDC).
BRP Companies Co-Founders and Managing Partners Meredith Marshall and Geoff Flournoy were joined by New York City Department of Housing Preservation and Development (HPD) Commissioner Vicki Been, New York City Housing Development Corporation (HDC) President Gary Rodney, Goldman Sachs Managing Director Margaret Anadu, Local Development Corporation of East New York Executive Director Sherry Roberts, Community Solutions Director of Real Estate Dave Foster, along with scores of community and financial partners in a joint ribbon-cutting and ground breaking ceremony.
“In many ways, Livonia Commons (L2) and the East New York Resyndication Project represent the multifaceted nature of HPD’s work, both in East New York and across the broader city as a whole,” said HPD Commissioner Vicki Been. “The unifying factor is our bottomline – keep homes affordable and in good condition, and create new affordable opportunities for more New Yorkers. I want to thank BRP for this tremendous success and I look forward to our continued partnerships to meet HPD’s and HDC’s goals.”
“This second phase of construction of Livonia Commons and completion of the East New York Resyndication project reinforces our longstanding commitment towards reinventing a neighborhood that has for too long been neglected. By combining preservation and new construction, we are ensuring that large quantities of housing not only remain affordable to the community, but that they are rehabilitated to a high quality that the community deserves. Livonia Commons demonstrates a true culmination of the types of projects I have strived to build in collaboration with all of our dedicated partners, including BRP Companies, during my time with HDC,” said HDC President Gary Rodney. “I know that Livonia Commons and the greater investment in East New York will be an outstanding example of the positive impact that thoughtful neighborhood development, comprehensive rezoning, and real rental affordability can have on our community for generations to come.”
“Our work in East New York reflects BRP’s core mission to develop affordable housing in areas that are too often overlooked and underserved,” said Meredith Marshall, BRP Companies Co-Founder and Managing Partner. “By creating and preserving 710 affordable units in East New York, along with 30,000 square feet of community and retail space we aim to make a sustainable and positive impact in the East New York community for years to come. Like all our projects, Livonia will be green, accessible to transit, and connect the community with much needed retail and services.”
“Preserving and creating affordable housing is integral for the economic sustainability of our communities and city,” stated Brooklyn Borough President Eric L. Adams. “I thank BRP Development, the New York City Department of Housing Preservation and Development, and the New York City Housing Development Corporation, for advancing this project to bring much-needed affordable housing to Brooklyn, as well as integrating important energy efficiency measures required to further drive down cooling and heating costs for low-income residents as well as combat climate change.”
“Quality affordable housing is one of top concerns expressed by our constituents and thus one of the top priorities in the work carried out by our office,” said New York City Councilmember Inez Barron. “When people refer to affordable housing, the important question is ‘affordable to who?’ We are proud to say that the housing in this project is affordable to the people who live East New York and neighboring communities. Instead of development that pushes people out, here is development that builds people and our community up. It is exciting to be an integral part of this kind of revitalization.”
The rehabilitation process for BRP’s East New York Portfolio, which consists of 63 buildings with a combined total of 468 units, was completed within 18-months. The properties were initially constructed in the 1990s. After decades of neglect and deferred maintenance subjecting residents to dangerous living conditions including leaky roofs, cracked foundations and black mold, BRP took significant steps to make the buildings safer, more secure and energy-efficient. Apartments received new kitchens, bathrooms, windows, mold remediation, the installation of new roofs, masonry and facade work, the installation of new, energy-efficient boiler/heating systems, new building entry doors with controlled entry access systems including video surveillance and intercom systems, and new public corridors and stairwells with energy efficient lighting. BRP Companies acquired the East New York Rental Portfolio in January 2014 with over $90 million of equity and debt financing from Goldman Sachs and additional financing from HPD and HDC. The newly renovated apartments are affordable to low-income households earning no more than $48,960 for a family of three. The revitalization was completed in January 2015.
Keith Logan, a lifelong resident of East New York who has lived in his 496 Williams Avenue for 15 years, said, “I love this neighborhood and having affordable rent allows me to stay here. I lived in my apartment through the rehab and they totally renovated the kitchens, bathrooms, and floors from scratch and did a wonderful job. It’s great to raise my family where I grew up. Everything came out really nice. I love East New York and I could never leave Brooklyn. I think more affordable housing is good.”
The newly constructed affordable buildings are a part of the second phase of the City’s Livonia Avenue Initiative. BRP was designated the lead developer on this project, known as L2, in 2014 and the project was financed under New York City Mayor de Blasio’s Housing New York, a Five-Borough, Ten-Year Plan. The plan was designed to create and preserve 200,000 units of affordable housing. This is the most comprehensive affordable housing plan in the City’s history and the largest municipal housing plan in the nation. Its goal is to help address New York City’s affordability crisis by housing more than half a million New Yorkers, ranging from those with very low incomes to the middle class – all of whom face ever-rising rent pressures.
The L2 development will be constructed along Livonia Avenue and will be bordered by Van Sinderen Avenue to the west and Williams Avenue to the east. The completed project will include three newly constructed energy-efficient and sustainably designed buildings with a mix of affordable housing and commercial and community resources. The buildings will be accessible by the Metropolitan Transportation Authority’s (MTA) L, 2, and 3 trains at Livonia Avenue.
Once complete, the project will bring 242 new rental apartments and 30,000 square feet of community and retail space to the East New York Community. The apartments will be affordable to extremely low-income households earning no more than $24,480 for a household of three, very low-income households earning no more than $$45,300 for a household of three, and low-income households earning no more than $48,960 for a family of three. The Local Development Corporation of East New York, a community partner that lobbied to activate the long vacant sites for many years, is collaborating with BRP to shape the development so it aligns with community needs. The facility will include retail, educational and community services coordinated by Community Solutions and HELP USA. LEED for Homes certification is anticipated with numerous green elements including solar panels, water saving plumbing systems, energy efficient boilers and green roofs. Occupancy is expected in early 2018.
“The new buildings are designed to achieve an active and pedestrian friendly environment at street level, with new plantings and large retail windows,” said Christine Hunter, AIA, LEED AP BD + C, Principal Magnusson Architecture and Planning. “The facades above are gently angled to turn apartment windows slightly askew from the train line, creating more privacy for apartment residents and varied vista above the track level.”
“The quality of housing and community spaces in East New York makes a critical impact on the health and overall wellbeing of local families,” says Rosanne Haggerty, President of Community Solutions. “Livonia II is designed specifically to promote safety and stability, and answers a call from the community to revitalize this central neighborhood corridor.”
The total development cost for the East New York Preservation deal is approximately $96,501,289. HPD provided Low-Income Housing Tax Credits that resulted in $31.8 million in permanent tax credit equity. Goldman Sachs acted as the Letter of Credit Bank and low income housing tax credit investor. HPD also provided $18.7 million in City Capital. HDC provided Tax Exempt Bonds that contributed $53 million to construction financing.
The total development cost for the L2 development is approximately $100,962,272. HPD provided Low-Income Housing Tax Credits that resulted in $43.1 million in permanent tax credit equity. HPD also provided $17.5 million in City Capital. HDC provided $15.7 million from Corporate Reserves towards permanent financing and $51 million in Tax Exempt Bonds towards construction financing. Red Stone Equity Partners acted as tax credit investor. JP Morgan Chase and Capital One acted as lenders.
“Having financed the creation and preservation of over 20,000 housing units over the past 15 years, we know that quality affordable housing is a key component in any healthy community,“ said Margaret Anadu, Goldman Sachs Managing Director who leads the Urban Investment Group. “The Project is a model for long-term affordable housing that will substantially increase the quality of life for many low- and moderate-income households in East New York.”
“Red Stone Equity was pleased to partner with BRP Development on this project which will help revitalize Livonia Avenue in East New York and Brownsville,” said Richard Roberts, Red Stone Equity Managing Director of Acquisitions. “Reclaiming City-owned sites is an important redevelopment strategy. A newly constructed high rise building encompassing 242 affordable housing units and retail space will be an important new amenity in the community. Red Stone Equity is honored to have participated.”
“Capital One is proud to have partnered with BRP and the other funders that helped make Livonia a reality,” said Mark Migliacci, Vice President, Capital One. “This development is a key component to the City’s efforts to revitalize the Livonia Avenue corridor. We look forward to welcoming all the residents to their new home when the development is completed.”
About BRP Companies:
BRP Companies is a New York-based real estate firm that is at the forefront of mixed-use development and acquisition of urban, multi-family properties. The firm offers a full complement of development, acquisition, construction, property, and investment management. With an experienced staff of 70, a track record of over 1.3 million SF of completed real estate projects and 3. million SF currently in development, BRP is uniquely positioned to meet the demands of urban housing consumers. The firm is an innovator in developing mixed-use, mixed-income, “walkable” urban housing with high-quality, and energy efficient properties throughout the city of New York and beyond. www.brpcompanies.com
About the New York City Department of Housing Preservation and Development (HPD):
HPD is the nation’s largest municipal housing preservation and development agency. Its mission is to promote quality housing and diverse, thriving neighborhoods for New Yorkers through loan and development programs for new affordable housing, preservation of the affordability of the existing housing stock, enforcement of housing quality standards, and educational programs for tenants and building owners. HPD is tasked with fulfilling Mayor de Blasio’s Housing New York: A Five-Borough Ten-Year Plan to create and preserve 200,000 affordable units for New Yorkers at the very lowest incomes to those in the middle class. For more information visit www.nyc.gov/hpd and for regular updates on HPD news and services, connect with us via www.facebook.com/nychousing and @nychousing.
About the New York City Housing Development Corporation (HDC):
HDC is the nation’s largest municipal Housing Finance Agency and is charged with helping to finance the creation or preservation of affordable housing under Mayor Bill de Blasio’s Housing New York plan. Since 2003, HDC has financed more than 120,000 housing units using over $13.7 billion in bonds, and provided in excess of $1.6 billion in subsidy from corporate reserves. HDC ranks among the nation’s top issuers of mortgage revenue bonds for affordable multi-family housing on Thomson Reuter’s annual list of multi-family bond issuers. In each of the last four consecutive years, HDC’s annual bond issuance has surpassed $1 billion. For additional information, visit: http://www.nychdc.com