HPD, HDC, Exact Capital, Monadnock Development And Partners Celebrate Return Of Tenants To Formerly Blighted Bryant Avenue Buildings
1553-1555 and 1558 Bryant Avenue Received Complete Rehabilitation and Systems Upgrades
After Years of Disrepair and Neglect by Former Owners
Bronx, NY – New York City Department of Housing Preservation & Development (HPD) Commissioner RuthAnne Visnauskas, New York City Housing Development Corporation (HDC) Executive Vice President for Real Estate Joan Tally, Exact Capital, Monadnock Development and partners celebrated the re-opening of 1553-1555 and 1558 Bryant Avenue in the Bronx. Both buildings underwent significant rehabilitation after being acquired by Exact Capital and Monadnock Development in 2011. The buildings’ previous owner allowed the properties to fall into such disrepair that they were placed in HPD’s Alternative Enforcement Program (AEP), an initiative that annually targets the 200 most distressed buildings in the City for remediation. HPD, the development team, lenders and other partners were able to affect a change in ownership, and put in place a comprehensive rehab and financing plan that got the buildings back into good repair and into a stable financial situation for the long-term.
The preservation of the City’s existing affordable housing stock, and keeping people in their homes is a critical component of Mayor Michael R. Bloomberg’s New Housing Marketplace Plan (NHMP), a multi-billion dollar initiative to finance 165,000 units of affordable housing by the close of the 2014 fiscal year. To date, the plan has funded more than 156,769 units across the five boroughs, with nearly 49,370 units in the Bronx, and more than 8,153 of those units in Bronx Community Board 3 where this development is located. For every dollar invested by the City for affordable housing, the NHMP has leveraged $3.48 in funding from other sources for a total investment of more than $23.6 billion.
“Preserving peoples’ homes and bringing them back into safe conditions is central to HPD’s mission. Today we celebrate the beginning of a new life for two buildings whose tenants have seen more than their fair share of struggles.” said HPD Commissioner RuthAnne Visnauskas. “I want to thank our incredible team from HPD’s Neighborhood and Enforcement Services for everything they have done in service of the tenants of these buildings particularly through the Alternative Enforcement Program. I also want to thank our development team, our partners at HDC, Exact Capital, Monadnock Development, Richman and Citibank.”
“We’re thrilled to participate in the rehabilitation financing of Bryant Avenue Apartments,” said Joan Tally, EVP for Real Estate at HDC. “Our goal is to ensure that aging developments receive the resources needed to make essential repairs and remain affordable. The preservation of New York City’s housing stock is a key component of the Mayor’s housing plan and serves to stabilize communities and improve the quality of life for New Yorkers.”
Built in 1925, 1553-1555 Bryant Avenue is a five-story walk-up building with 62 units. 1558 Bryant Avenue was built in 1931 and contains 37 units. Both buildings have a combined total of 99 residential units including 65 one-bedroom apartments, 26 two-bedroom apartments, 7 three-bedroom apartments and one two-bedroom unit used as a superintendent's unit.
1558 Bryant Avenue entered the third round of AEP in 2009. After a preliminary cellar-to-roof inspection, HPD recorded over 500 new housing maintenance violations at this property. HPD performed more than $147,600 in emergency repairs to correct the most hazardous violations which the previous owner failed to address. These vital repairs included replacing the roof to address the underlying condition of numerous water leak problems. 1553-1555 Bryant Avenue entered the fourth round of AEP in 2011, with HPD issuing over 1,290 housing maintenance code violations during comprehensive cellar-to-roof inspections. This building required more than $97,896 in emergency repairs by HPD including replacement of the roof, heat distribution system and floor coverings, as well as an electrical upgrade. In 2011, building ownership was transferred from the neglectful former owner to Exact Capital and Monadnock Development.
"Exact Capital is excited to have participated in a project that transformed an overleveraged distressed asset into Green affordable housing," said Michael Callaghan of Exact Capital.
"The buildings have come a long way since we took on the project," explained Nick Lembo, President of Monadnock Development. "We're proud to have transformed 1553-1555 and 1558 Bryant Avenue into dignified residences for the New Yorkers who call them home. This was only possible with our partners, Exact Capital and Wavecrest Management. We are grateful for their collaboration, and for our working partners, Citibank Community Capital, Richman Housing Resources, and, of course, the NYC HPD."
With the buildings in a state of extreme disrepair, extensive rehab work was necessary to make them habitable and safe for the tenants to reoccupy. At least 25% of the floor joists were replaced; four stories of stairs needed to be replaced in each building; the top story and parapet needed new beams and re-pointing and the rear retaining wall and sidewalk needed repair at 1553-1555 Bryant. Additionally, the entire electrical distribution and storm water drainage systems were replaced; the oil fired boilers were replaced with smaller, more efficient gas fired boilers; the water supply and sanitary systems were replaced; and all plumbing fixtures were updated. Work inside the units included installing new kitchen fixtures, appliances and bathroom accessories; cracks and holes in the existing plaster and paint were repaired; new interior doors were installed and new windows were installed where necessary.
The existing residents were temporarily relocated within the two buildings or offsite when necessary to allow for rehabilitation work. All existing tenants were given the right to return to their units, and they will not see a rent increase due to the renovation work done to their apartments.
In addition to aiding in the rehabilitation of the buildings, the funding provided by the City to Exact Capital and Monadnock Development includes regulatory agreements that ensure the apartments remain affordable to low-income households. For tenants moving into vacant units, rents are made affordable to families earning up to 50% Area Median Income (AMI), or no more than $40,900 for a family of four, and no more than 60% AMI, or no more than $49,080 for a family of four. AMI levels are calculated annually by the U.S. Department of Housing and Urban Development (HUD). These income restrictions are according to HUD’s 2011 calculations.
The total development cost for the rehabilitation of 1553-1555 and 1558 Bryant Avenue is $21.05 million. HDC provided $10.2 million in tax-exempt bonds and $450,000 in subsidy from corporate reserves in construction financing. HPD provided $6.4 million in City Capital funds and $1.9 million in HOME funds toward permanent financing. The development received $7.1 million in tax credit equity. Richman Housing Resources will act as the tax credit syndicator. The remaining permanent financing was provided by the developer. Wavecrest Management will act as the managing agent for both buildings.
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 of 165,000 units of affordable housing by the end of fiscal year 2014. Since the plan’s inception, more than 156,769 affordable homes have been created or preserved. For regular updates on news and services, connect with us via www.facebook.com/nychpd and www.twitter.com/nychousing. For more information, visit our website at www.nyc.gov/hpd.
About the NYC Housing Development Corporation (HDC):
Since 2000, HDC has issued roughly 10% of all the multi-family housing revenue bonds in the U.S. and since 2003, when Mayor Bloomberg’s New Housing Marketplace Plan was launched, HDC has raised more than $6.7 billion in financing for affordable housing developments, including providing in excess of $1 billion in subsidy from corporate reserves. In Affordable Housing Finance magazine’s annual listing of the nation’s top ten funders of multifamily housing, HDC is the only municipal entity on the list. In 2013, HDC was the third largest affordable housing lender in the U.S. after Citi and Wells Fargo, beating out Bank of America, JPMorgan Chase and Capital One. To date, under the Mayor’s plan, HDC has financed the creation or preservation of more than 73,765 of the total 156,397 affordable units. Multifamily buildings financed by HDC contain more than 1.7 million square feet of commercial space. For additional information, visit: www.nychdc.com
About Exact Capital:
Exact Capital, based in New York City, is a diversified real estate development firm built on more than three decades of experience. We are principally engaged in the acquisition, finance, development, and management of mixed use residential and commercial real estate. Our core strength is our ability to source, structure, finance, develop, and oversee a range of real estate development projects ranging from affordable housing to luxury condominiums to mixed use commercial developments. Our experience and expertise includes all aspects of development and operations, from planning and approvals to construction, marketing, sales, leasing and management.
Established in 1975, Monadnock has steadily grown over the years into one of the largest and most reputable residential contractors and developers in the New York area. In that time Monadnock has built and developed over 12,000 units of housing, including luxury hi-rises, modular and site built town homes, mid-rise affordable housing, dormitories, supportive housing, and senior housing. Regardless of the size of the job, Monadnock delivers a commitment to quality and a focus on practical problem solving. For more information, please visit www.moncon.com.
About Wavecrest Management Team Ltd.:
The Wavecrest Management Team Ltd. is a full service management company that manages approximately 19,500 residential units in over 300 buildings in the New York metropolitan area. Our specialty is the management of affordable housing with a majority of the buildings we manage being located in The Bronx, Manhattan and Brooklyn.. Our mission and dedication is to maintain safe, quality and affordable housing.