Preserving Affordable Housing in High-Cost Manhattan

Multifamily Wire

Multifamily Facts

Manhattan Park, New York, NY

Lender: Capital One Multifamily Finance, LLC
Loan Type: Affordable Refinance
Loan Amount: $265,000,000
Units: 1,107
LTV: 72%
DSCR: 1.20x
Loan Term: 10
Amortization: 30

August 15, 2014 -- Fannie Mae Multifamily Affordable Lending recently closed a $265 million refinance of Manhattan Park, a five-building high-rise situated on 8.5 acres on Roosevelt Island in Manhattan. Manhattan Park has a complicated ownership structure, with numerous stakeholder interests to accommodate. Thanks to the expertise of Fannie Mae's dedicated affordable housing team and our flexible loan structuring we were able to execute this transaction speedily and with great results.

According to Woody Brewer, Fannie Mae's Vice President for Affordable Housing and Multifamily Customer Engagement, there was one important factor that clinched this deal. "We put our best price on the table right away and won with our first bid. Putting our best quote out first demonstrates our commitment to the deal and to the borrower – as well as our determination to win the business we want."

Manhattan Park serves mixed-income tenants and is the largest property on Roosevelt Island. The property was built by the Borrower in 1989, with the help of Low Income Housing Tax Credits and bond financing. Like all residential properties on Roosevelt Island, Manhattan Park is subject to a 99-year ground lease. As part of the current refinancing, the tax credit investor's interests are being purchased by the remaining partners.

An existing Section 8 HAP contract on the property that expires in 2019 requires 20% of the units be designated for low-income Section 8 tenants. "In notoriously expensive Manhattan, being able to preserve 223 units of affordable housing is a real triumph," notes Brewer.

Performance prospects are bright for the property. Cornell University plans to build an applied science campus on the Island, and this new development will further improve Manhattan Park's value and performance.

For more information about how Fannie Mae finances Multifamily Affordable Financing, contact your Deal Team.