Building Healthy and Stable Communities with Healthy Housing Rewards Enhanced Resident Services
At Fannie Mae, we know that improving affordable housing is about more than just bricks and mortar. Tackling a multifaceted problem like the housing affordability crisis requires a number of solutions. We must focus not only on preserving and increasing the supply of affordable housing, but also on providing a healthy and supportive place to live for the people who call these properties home. Fannie Mae’s Healthy Housing Rewards™ program offers one solution.
Healthy Housing Rewards promotes tenant health and well-being by incentivizing borrowers to make healthy design improvements or offer resident services in multifamily affordable properties. Design elements that promote physical activity and create healthy indoor environments, as well as resident programs for financial literacy, education support, and job training, can positively impact the health and well-being of residents. And with Healthy Housing Rewards, borrowers can follow one of two pathways to qualify for discounted financing: Healthy Design or Enhanced Resident Services™. To qualify for either pathway, properties must keep a certain percentage of the units at the property affordable to low-income tenants – at least 60 percent of units must serve tenants with incomes at or below 60 percent of the area median income (AMI).
In 2018, Omni New York LLC looked to revitalize two buildings in Newark, New Jersey: Garden Spires, built in 1963, and Spruce Spires, built in 1920. Both properties needed substantial upgrades to make them better places for tenants to live. KeyBank Real Estate Capital and KeyBank Community Development Lending & Investment provided Fannie Mae Healthy Housing Rewards Enhanced Resident Services loans to Omni for the purchase and rehabilitation of Garden Spires and Spruce Spires.
Garden Spires Apartments is comprised of 544 units of affordable rental housing in two 20-story buildings. Spruce Spires is comprised of six five-story buildings totaling 112 units. All of the units are included in a project-based Section 8 Housing Assistance Payment (HAP) contract and also benefit from New Jersey's Payment in Lieu of Taxes ("PILOT") program.
The units will get substantial rehabilitation, including renovations to the lobby areas, individual units including kitchens and bathrooms, as well as major improvements to building systems and exteriors. Omni plans to invest more than $60 million in this rehabilitation, and the tenants will not be displaced during the renovation period. In addition, Omni will provide resident services including adult and youth education support, job training, and health, wellness, and nutrition services.
Working Together to Effect Change
To qualify for Fannie Mae's Healthy Housing Rewards Enhanced Resident Services program, Omni became a Certified Organization for Resident Engagement & Services and obtained the Enhanced Resident Services certification for the properties through Stewards for Affordable Housing for the Future, with initial certification fees covered by Fannie Mae.
The rehabilitation of Garden Spires and Spruce Spires is an example of Fannie Mae's work to help solve the nation’s affordable housing crisis. These efforts are designed to ensure that housing is not only affordable but also a healthy and safe place for residents at all income levels, including those at the lowest end of the income spectrum.
As the leading source of affordable financing in the multifamily sector, Fannie Mae remains committed to serving the nation’s rental housing needs. We look forward to doing more – and to working with our lender partners and the housing community to develop solutions to these important issues. To learn more about the Healthy Housing Rewards program, visit https://www.fanniemae.com/multifamily/healthy-housing-rewards.
Vice President of Affordable and Green Financing at Fannie Mae
January 9, 2019