NEW YORK, NY – The Rose Smart Growth Investment Fund I, L.P., the nation’s first real estate investment fund focusing on the acquisition and greening of existing buildings, has acquired 198 units of affordable housing and approximately 4,500 square feet of ground floor retail at 107-145 West 135th Street in Harlem for $26.5 million.
The transaction was announced by Nathan Taft, Director of Acquisitions for Jonathan Rose Companies, a leading green real estate development, planning, owner’s representative and investment firm that established the Fund.
While the project’s HUD Section 8 contract was set to expire at the end of last year, the Fund worked with the U.S. Department of Housing and Urban Development to obtain an interim renewal at acquisition, and lay the groundwork for a new 20 year contract to preserve the affordability of the project long term. As the new owner, The Fund also plans to rehabilitate the property with a green capital investment program that will create an apartment community that is more energy efficient and better for the health of residents. The project will be a model for the greening and preservation of existing affordable housing.
“Income diversity is essential to healthy communities, and as Harlem gentrifies, the preservation of affordable housing is very important,” said Mr. Taft. “There is a real opportunity to create green, energy efficient homes that will greatly improve the lives of the current residents of these buildings. We are committed to preserving the affordability for residents, while enriching and revitalizing the community, and greatly appreciate the support of our lender and the public agencies that helped make this acquisition possible, including HUD, HPD, HDC and the Housing Partnership Development Corporation.”
The Rose Smart Growth Investment Fund I financed the purchase through an acquisition loan from the New York City Acquisition Fund (NYAF), which provides acquisition and predevelopment loans to developers committed to the creation and preservation of affordable housing in the five boroughs of New York City. NYAF was established through the collaboration of the City of New York, major foundations, and New York’s banking industry. The Fund is managed by Enterprise Community Investment, Inc., and National Equity Fund, Inc., as co-members and managers. Forsyth Street Advisors LLC is the Fund Manager, and JPMorgan Chase Bank N.A. acts as the Administrative Agent of a multi-bank syndicate, providing a revolving line of credit for funding loans. Enterprise Community Loan Fund acted as the deal originator.
The asset is comprised of 10 identical, neighboring, six-story elevator buildings located directly across the street from the historic Harlem YMCA and in close proximity to the New York Public Library’s Schomburg Center for Research in Black Culture, Harlem Hospital and several subway lines. The residential units are 98% occupied and three out of the four commercial units are currently in use.
The Rose Smart Growth Investment Fund I has assembled a remarkable interdisciplinary team to assist in the management and green renovation of the property, including Dattner Architects and The Phipps Houses Group, one of the nation's largest not-for-profit developers, owners and managers of affordable housing.
The scope of the multi-million dollar capital improvement program work will consist of both unit renovations and base building improvements focusing on improving energy efficiency, enhancing tenants’ quality of life and improving indoor air quality with the use of low VOC paint and finishes. The Fund intends to utilize Enterprise’s Green Communities Criteria, the New York State Energy Research and Development Authority’s (NYSERDA) Multifamily Building Performance Program, and the New York Division of Housing and Community Renewal’s (DHCR) Weatherization Assistance Program.
The Rose Smart Growth Investment Fund I, L.P. was established by Jonathan Rose Companies, LLC to focus exclusively on providing economic and environmental returns. The Fund is committed to acquiring real estate near transit or in walkable communities, and enriching these assets with green management practices, professional real estate skills and a long-term investment strategy.
