BOSTON – MassHousing has provided a total of $22.4 million in affordable housing financing to an affiliate of Preservation of Affordable Housing (POAH) for the acquisition, rehabilitation and long-term preservation of affordability at the 96-unit Bedford Village and the 14-unit 447 Concord in Bedford. POAH plans to make extensive property renovations to both housing communities.
The transaction will also resolve the expired Section 13A mortgage on 43 units at Bedford Village and support the continued tenancies of those residents without substantial rent increases. Overall, affordability will be preserved at both housing communities for at least 30 years.
“This is a great outcome for the residents of Bedford Village, 447 Concord, and the Town of Bedford, which strongly advocated to maintain this important affordable housing resource in the community and provided substantial financial support for this transaction,” said MassHousing Executive Director Chrystal Kornegay. “POAH has an exceptional record of completing complicated transactions like this one, with the goal of providing quality affordable housing opportunities for households across Massachusetts. We were pleased to work with the Town of Bedford, POAH, and the Commonwealth, to preserve and renovate these properties for the long-term affordability and prosperity of the residents.”
“These homes are greatly needed in Bedford, where there are limited rental options for lower-income families,” said POAH President/CEO Aaron Gornstein. “Our partners’ support – through new financing which continues the legacy of state funding and local support through the Community Preservation Act – will ensure long-term affordability for years to come.”
MassHousing is providing POAH with an $8.2 million construction and permanent loan, a $9.2 million tax credit equity bridge loan, and a $5 million 13A preservation loan. The MassHousing financing generated $7.5 million in Low-Income Housing Tax Credit equity for the project.
The transaction also involved $5.7 million in direct support from the Massachusetts Department of Housing and Community Development (DHCD), $3.8 million in Community Preservation Act financing from the Town of Bedford, and $1.050 million in resubordinated debt from the Massachusetts Housing Partnership. The tax credits are being syndicated by the Massachusetts Housing Investment Corporation.
Of the 96 units at Bedford Village, 62 will be for households earning at or below 60% of the Area Median Income (AMI), 7 units will be for households earning at or below 80% of AMI and 27 units will be for households earning at or below 100% of AMI. The Area Median Income for Bedford is $107,800 for a family of four. Nineteen of the units under the 60% of AMI tier are subsidized through the Massachusetts Rental Voucher Program.
The continued tenancy of the 43 13A households will be spread across the three income tiers at Bedford Village, based on existing household income.
The Commonwealth’s Section 13A program was created by the Massachusetts Legislature in the 1970s to provide low-interest mortgage financing to affordable housing communities. Today, 13A communities serve some of the lowest-income and most vulnerable populations in Massachusetts, including many elderly residents. The mortgages on these 13A housing communities are nearing maturity, and no federal resources are available for their preservation. In response, MassHousing and DHCD have committed a total of $100 million in capital to help protect vulnerable residents and preserve affordable 13A units that otherwise could convert to market rates.
The 96 units at Bedford Village are contained within 10 buildings and include 36 one-bedroom apartments, 50 two-bedroom apartments and 10 three-bedroom apartments. Property improvements will include roof and window replacement, new hot water heaters, fire protection upgrades and drainage improvements.
Of the 14 units at 447 Concord, 12 will be for households earning at or below 50% of AMI and two will be rented at market rates. Four of the units are subsidized with a federal Section 8 Housing Assistance Payment Contract, which will be extended for 15 years.
There are 10 two-bedroom apartments and 4 three-bedroom apartments at 447 Concord. POAH will complete the acquisition of the 10-year-old property in 2019 and will make property improvements including some accessibility upgrades, common area floor replacement, and painting.
MassHousing has financed or administers federal subsidies at three rental housing communities in Bedford involving 399 units and $28.5 million in financing. The agency has financed 42 home mortgage loans in Bedford, totaling $6.4 million in financing.