In NYC: Building Affordable, Workforce Housing
In the Big Apple, finding an affordable home that’s near public transit can feel like finding a needle in a haystack.
So it’s good news that a new 550-unit apartment building is being built in Queens right by a huge transit station to house mixed-income residents, many of whom have low to moderate incomes.
The Crossing at Jamaica Station is workforce housing that will replace a run-down property to serve the needs of the community. It’s happening because of an innovative partnership with the lender RICHMAC Funding LLC, New York City Housing Development Corporation (HDC), and Freddie Mac. The Borrower entered into a Brownfield Cleanup Program grant to help transform the blighted site.
Freddie Mac provided $158 million in an unfunded forward commitment for a bond credit enhancement.
The deal structure really helped the Borrower save money by using privately placed, floating rate bonds which do not require an expensive liquidity facility. This worked because an institutional investor, the Federal Home Loan Bank of New York, purchased the bonds issued by HDC.
“Freddie, as we’ve come to expect, your partnership in getting this done was incredible,” said RICHMAC Funding President Matthew Wambua, commenting on the team and the “extremely complex structure.”
The deal offers an affordable way for tenants to live in a high-end building. The 26-story complex will feature great views, with underground parking and retail on the first floor. The amenities include those more typical of a luxury community, such as a fitness center, children’s playroom, resident lounge and a large outdoor terrace on the 25th floor.
Making It Affordable
Nearly 17 percent of the units are affordable to low income residents, while almost 28 percent are workforce housing. In addition, incomes for market rate tenants are capped at 165 percent of Area Median Income (AMI).
- 90 units at 57% AMI or less (affordable or low income)
- 100 units at 125% AMI or less (workforce or moderate income)
- 49 units at 130% AMI or less (workforce or moderate income)
- 299 units capped at 165% AMI (market rate)
Getting around in a busy place like NYC can be difficult. With the transit station right next to The Crossing, residents will find it easy to get to Manhattan, Brooklyn, Queens, or the airport with relatively few if any transfers—making this development ideal for workforce housing.
The project is considered a critical component of NYC Mayor De Blasio’s affordable housing plan, and is being developed with the Housing Plan’s Inclusionary Housing Program and middle-income program. The Developer, BRP, worked closely with the New York City Housing Development and Preservation Department and HDC.
In addition to HDC issuing bonds, the two agencies will provide more than $54 million in subordinate, subsidized loans—a significant capital contribution showing the city’s considerable commitment. The project also secured a 40-year full tax abatement to help get it built. The project exemplifies how various funding sources can successfully come together to make affordable housing projects possible.