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HDC Press Releases
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July
22, 2010
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The Dermot Company,
Inc. Closes
Construction
Financing For
Affordable Housing
Project Containing
78 Rental Units And
New Headquarters For
The Lower Eastside
Girls Club With NYC
Department Of
Housing Preservation
And Development, NYC
Housing Development
Corporation, Bank Of
America, JP Morgan
Chase, Carver &
Grosvenor Investment
Management
LEED Certified Project Also Includes Retail Space on Avenue D
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New York, NY (July 22,
2010)-- The Dermot
Company, Inc., The Lower
Eastside Girls Club of
New York, Inc. and
Grosvenor Investment
Management US, Inc. have
partnered with the City
Department of Housing
Preservation and
Development (HPD) and
the NYC Housing
Development Corporation
(HDC) and private sector
financial institutions
to develop a new
mixed-use property at
101 Avenue D between 7th
and 8th Streets on
Manhattan’s Lower East
Side that includes a
30,000 square-foot
headquarters for The
Lower Eastside Girls
Club and 78 mixed-income
rental residences.
The project is being
developed under Mayor
Michael R. Bloomberg’s
New Housing Marketplace
Plan (NHMP), an $8.4
billion initiative to
finance 165,000 units of
affordable housing for
half a million New
Yorkers by 2014. To
date, the plan has
funded the creation or
preservation of nearly
108,600 units of
affordable housing
across the five
boroughs.
The Lower Eastside Girls
project has been
financed with a
combination of
tax-exempt housing bonds
and new market tax
credits. HPD sold the
land to the Lower East
Side Girls Club at a
steeply discounted price
to subsidize the
affordable housing and
HDC has provided
tax-exempt bond
financing and subsidy
loans. Bank of America
has provided the
supporting Letter of
Credit for the
residential portion of
the project. In
addition, Bank of
America, and Carver
Community Development
Corporation provided an
allocation of New Market
Tax Credits (NMTC),
which Bank of America
and JP Morgan Chase will
invest in to raise NMTC
equity financing for the
Girls Club headquarters.
Grosvenor Investment
Management US, Inc. has
provided equity joint
venture capital for the
project. The building is
being constructed by D7
Construction, LLC.
”We are thrilled to have
closed on the
construction financing
for this unique project.
Assembling the financing
was complicated and
involved a myriad of
different City agencies,
banks and investors
making it the most
complex development
project we have done to
date,” said Drew Spitler,
Director of Development,
The Dermot Company, Inc.
“The financing
environment is quite
challenging but in
conjunction with the
Girls Club, we were able
to get this absolutely
amazing project across
the goal line.”
"Our dream is finally
becoming a reality,"
said Lyn Pentecost,
founder and executive
director of the Lower
Eastside Girls Club (LESGC).
"Thanks to the efforts
of many – private
individuals,
foundations, the City,
State, Federal
government, banks,
architects and
developers -- our girls
and young women will be
able to become the next
generation of leaders,
pursuing their dreams in
a state-of-the-art
building. From a
planetarium to a bakery,
from a recording studio
to classrooms for
tutoring, the youth of
our community will have
the tools to go out into
the world with knowledge
and confidence."
Located at 101 Avenue D,
the 12-story, brick
building is expected to
be LEED certified and
will include 4,700
square-feet of retail
space along the avenue.
Residents of the 78
rental units will enjoy
onsite amenities such as
a fully-equipped gym,
laundry facilities, a
rooftop deck and bike
storage. Built under
HDC’s Mixed Income
Housing “50/30/20”
program, 50 percent of
the apartments are
affordable to low- and
moderate-income families
including 12 units that
will remain permanently
affordable under the
provisions of HPD’s
Inclusionary Zoning
Program, and the
remaining 50 percent of
the apartments are
market rate but subject
to rent stabilization.
To fund the residential
and retail space, HDC
issued $25 million in
bonds including $15.25
million of recycled
tax-exempt bonds and
$9.75 million of
tax-exempt bonds subject
to the private activity
volume cap, all backed
by a Letter of Credit
from Bank of America.
HDC also provided over
$2.5 million in
corporate subsidy. When
complete, 101 Avenue D
is expected to receive a
20-year phased 421a tax
abatement. The Lower
East Side Girls Club
portion of the project
was financed by a
combination of developer
equity and private
donations and grants,
equity generated from
NMTC, and $9.6 million
of Reso A funds,
comprised of $5.5
million from the Office
of the Mayor, $900,000
from Manhattan Borough
President Scott
Stringer, and $3.2
million from the City
Council.
“This exciting new
development to be built
on a parcel of
long-vacant City-owned
property represents the
best use to meet
multiple community
needs—affordable housing
and a community center
for neighborhood girls,”
said HPD Commissioner
Rafael E. Cestero. “The
planned development at
101 Avenue D is what the
Mayor’s New Housing
Marketplace Plan is all
about—revitalizing and
strengthening our
neighborhoods, promoting
economic diversity,
providing the
infrastructure to
stabilize families and
building housing that
will remain and
affordable resource over
the long term.”
“The development of this
housing and the new
Girls Club facility is
both important and
meaningful to this
community and the City
as a whole,” said Marc
Jahr, HDC President.
“The 101 Avenue D
Apartments will offer
top quality affordable
homes to a mix of area
residents while
providing the basis for
creating a
state-of-the-art LEED
Gold certified
neighborhood facility
that will provide the
means to enrich the
lives of young girls and
women, giving them every
chance to succeed and
lead.”
Robert Kilroy, Managing
Director, Grosvenor
Investment Management
noted, “Grosvenor
Investment Management is
pleased to continue our
long-standing investment
relationship with The
Dermot Company and to
assist in the
capitalization of
another property in NYC
with a multifamily
housing component. The
creativity and hard work
of a number of city
agencies facilitated our
proceeding with the
investment. We are
highly confident in the
development’s eventual
success.”
“We are very pleased to
be able to provide
financing that creates
an impact in this
community, including the
services of The Lower
Eastside Girls Club and
much-needed affordable
rental housing for the
area,” added Steve
Kenny, Bank of America
Merrill Lynch Real
Estate Regional
Executive.
Construction is expected
to be completed by June
2012. For more
information, please
visit
www.dermotcompany.com.
About The Dermot
Company, Inc.:
The Dermot Company,
Inc., based in New York
City, was formed in 1991
as a real estate
investment and
management company
focused on multi-family
sector opportunities.
The company has evolved
into a fully integrated
real estate company
employing over 200 real
estate professionals in
investment, finance,
management and
development. Dermot
currently manages nearly
$1.5 billion in assets
and owns or holds
investments in more than
5,000 multifamily units.
About The Lower
Eastside Girls Club of
New York, Inc.
The Lower Eastside Girls
Club was founded in 1996
to address the historic
lack of services
available to girls and
young women on the Lower
East Side. The effects
of inner-city social
turmoil which took place
in the 1960’s and 70’s
throughout the nation
hit the Lower East Side
community in Manhattan
very hard. Our
neighborhood experienced
unprecedented real
estate abandonment and
disinvestment as riots
flared, buildings burned
and drugs were rampant.
Many social service
agencies closed their
doors and moved during
these years, including a
branch of The Children’s
Aid Society and a
chapter of what is now
Girls Inc. One of the
few agencies to remain
open and "tough it out"
was the Boys Club of New
York, operating two
full-service facilities
for boys. Yet, when boys
and girls clubs
nationwide merged in
1986, becoming the
agency now known as Boys
& Girls Clubs of
America, few noticed
that The Boys Club of
New York, over 100 years
old and operating a
large facility on the
Lower East Side, opted
out of the merger. By
1990 the Lower East Side
had become the last
neighborhood in the
United States with the
"boys only" Boys Club
distinction. A diverse
group of Lower East Side
women consisting of
mothers, workers,
artists, educators,
scientists, athletes,
business women and
community activists
organized in 1996 to
address this obvious
inequity. Soon
thereafter, The Lower
Eastside Girls Club was
founded.
About Mayor Michael
R. Bloomberg’s New
Housing Marketplace
Plan:
New York City’s
affordable housing
program to build or
preserve 165,000 units
of housing — enough to
house half a million New
Yorkers — is the most
ambitious and productive
in the nation—creating
housing as well as jobs
for New Yorkers. In
April, 2010 the City
reached the critical
benchmark of 100,000
units
financed—representing an
investment of $4.5
billion to date by the
City, not including
roughly $5 billion in
bonds issued by HDC.
Led by HPD Commissioner
Rafael E. Cestero, the
Plan has been recast to
maintain momentum while
confronting head on the
economic challenges
facing the City, the
State, the housing
industry, the financial
sector and individual
New Yorkers and their
families. In order to
fulfill the NHMP goal of
165,000 units, HPD and
HDC are responding to
market realities and
focusing on three
primary goals:
strengthening
neighborhoods, expanding
the supply of affordable
and sustainable housing
and stabilizing families
by keeping them in their
homes. To read more
about the NHMP, please
visit
http://www.nyc.gov/html/hpd/html/about/plan.shtml
About the NYC
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
viable neighborhoods for
New Yorkers through
education, outreach,
loan and development
programs and enforcement
of housing quality
standards. It is
responsible for
implementing Mayor
Bloomberg’s New Housing
Marketplace Plan to
finance the construction
or preservation or
165,000 units of
affordable housing by
2014. Since the plan’s
inception, more than
100,000 affordable homes
have been created or
preserved. For more
information, visit
www.nyc.gov/hpd
About the NYC Housing
Development Corporation
(HDC):
The New York City
Housing Development
Corporation (HDC)
provides a variety of
financing programs for
the creation and
preservation of
multi-family affordable
housing throughout the
five boroughs of New
York City. HDC’s
programs are designed to
meet the wide range of
affordable housing needs
of the City's
economically diverse
population. In
partnership with the NYC
Department of Housing
Preservation and
Development, HDC works
to implement Mayor
Michael R. Bloomberg’s
New Housing Marketplace
Plan to create of
preserve 165,000
affordable housing units
by 2014. Since the plan
launched in 2004, HDC
financed nearly 44,200
homes for low- ,
moderate- and
middle-income New
Yorkers. The New York
City Housing Development
Corporation is rated AA
by S&P and Aa2 by
Moody’s.
About Grosvenor
Investment Management (GIM)
Grosvenor Investment
Management US, Inc.
serves as Grosvenor's
real estate investment
management operation in
North America. GIM is
part of Grosvenor Fund
Management, which was
established in 2005 as a
vehicle for third-party
participation in
Grosvenor-managed
investments. As of
year-end 2009, Grosvenor
Fund Management had
total funds under
management of
approximately USD$5.8
billion internationally.
Grosvenor is a privately
owned property group
with offices in 17 of
the world’s most dynamic
cities. It has five
regional investment &
development businesses
in Britain & Ireland,
the Americas,
Continental Europe,
Australia and Asia
Pacific. Its
international fund
management business
operates across these
markets. As at 31
December 2009, these six
businesses had total
assets under management
of US$16.4bn. Unusually
for a private company,
Grosvenor publishes a
full Annual Report &
Accounts, available at
www.grosvenor.com.
Contact:
Christina Sanchez, HDC
(212) 227-2644
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