Posted on July 7, 2004
The Massachusetts Housing Partnership (MHP) announced today that it has made a $750,000 loan commitment - $450,000 of it at no interest – to help a non-profit development team buy two three-family houses in Beverly.
The loan commitment will enable the Beverly Affordable Housing Coalition and its development partner in this project, Neighborhood of Affordable Housing (NOAH), to preserve six units as affordable rental housing in the Gloucester Crossing neighborhood of Beverly.
“To solve the affordable housing crisis, we’re going to have to support housing efforts of all types and sizes,” said Clark Ziegler, MHP’s executive director. “This is an example of two non-profits combining their community ties and management expertise to help make sure this neighborhood has decent affordable housing for years to come.”
MHP will be making the $750,000 loan through its Permanent Plus financing program, which helps multi-family developers to quickly obtain financing for the acquisition and renovation of affordable rental properties. This program combines MHP’s fixed-rate first mortgage financing with a zero percent interest deferred payment loan. In this effort, the borrower is getting a $300,000 first mortgage and $450,000 ($75,000 per unit) as a deferred payment loan.
All apartments will be affordable to households earning no more than 60 percent of the area’s median income, which is $49,620 for a family of four. All six apartments are two bedrooms and will rent for $975, plus utilities.
BAHC was formed in 2000 to address affordable housing needs in the city. It currently manages seven units of rental housing in downtown Beverly. NOAH owns and manages 93 units in East Boston and will manage the Gloucester Crossing apartments.
“This is a neighborhood of multi-families that is poised for change and headed toward having more high-end condos,” said Denise Deschamps, BAHC’s executive director. “We saw this as an opportunity to go in there and preserve some apartments for low and moderate-income families. There’s very little of that left in Beverly.”
MHP is a statewide public/non-profit affordable organization that uses private bank funds to provide long-term loans for affordable rental housing. MHP focuses these funds on rental developments that are supported by the communities and serve lower-income people. MHP will provide financing of up to $15 million per project but will also provide loans for smaller housing efforts. Since 1990, MHP has made nearly $350 million in loans and has financed over 11,000 units. Nearly half of all MHP loans have been for projects of 24 units or less.
Bank transactions like the recent Bank of America-Fleet deal trigger the statute that funds MHP. MHP recently reached an agreement with Bank of America on a $406 million loan and an $18 million cash grant. For more information about MHP’s rental financing programs, go to www.mhp.net.