|For Immediate Release:|
Christie Administration Marks Groundbreaking of Affordable Housing Project Assisted with Federal Sandy Recovery Funds
NEWARK, N.J. – The New Jersey Housing and Mortgage Finance Agency (HMFA) has announced the groundbreaking of Spruce Senior Apartments, a 57-unit affordable senior housing development in Newark, which was awarded federal Sandy Recovery funds.
The HMFA awarded Spruce Senior Apartments approximately $4.3 million in Community Development Block Grant (CDBG) Disaster Recovery funds through the Fund for Restoration of Multifamily Housing (FRM). The FRM program provides for-profit and non-profit housing developers an opportunity to secure zero-interest and low-interest loans to finance the development of affordable housing in the nine counties most impacted by Sandy as determined by the U.S. Department of Housing and Urban Development (HUD) in an effort to increase the supply of affordable housing stock in these areas in the aftermath of Superstorm Sandy.
“We are pleased to be able to use Sandy recovery funds to support worthwhile housing projects that help replenish the supply of affordable rental units that were destroyed or damaged by Sandy,” said DCA Commissioner Richard E. Constable III, who also serves as Chairman of the HMFA. “Spruce Senior Apartments will help seniors on fixed incomes, including those directly impacted by the storm, secure safe, decent, and permanent housing.”
HMFA leveraged the use of federal Low Income Housing Tax Credits (LIHTC), an existing affordable housing program administered by the Agency, to provide additional funding and expedite the construction process of Spruce Senior Apartments. In August 2013, HMFA awarded Spruce Senior Apartments the very competitive 9% LIHTCs through an open process based on a scoring system outlined in the State’s Qualified Allocation Plan (QAP). These tax credits generated equity of approximately $8.8 million, contributing most significantly to the total development cost of the project. In addition to awarding the tax credits and the CDBG Disaster Recovery funds, HMFA also provided the project $7.1 million in construction and permanent financing.
All the housing units in the project will be affordable to seniors with incomes at or below 60 percent of Area Median Income (AMI), with five units set aside for disabled homeless veterans, and one unit for a superintendent. During the first three months of lease-up, priority will be given to Sandy-impacted individuals who registered for Federal Emergency Management Agency assistance or who rented an apartment or owned a primary residence that was no longer habitable because of Sandy damage.
The five-story building, which will feature an elevator, computer labs, community spaces, and off-street parking, will be Energy Star-compliant and meet the State’s own green building program, Green Futures. All units will be adaptable or fully accessible to seniors with mobility impairments and have central air-conditioning and washer and dryer hook-ups.
Spruce Senior Apartments, which is being developed by Michael’s Development Company of Marlton, NJ, will be the first phase of a two-phase redevelopment project to replace Douglas Harrison Homes, a blighted housing project that was demolished by the City of Newark in 2010. The second phase will be a 60-unit multifamily apartment complex called Somerset Brownstones. When completed, the entire development will provide a total of 117 residential units.
“Spruce Senior Apartments will provide vital housing opportunities to senior citizens of low to moderate income, as well as those affected by the storm,” said HMFA Executive Director Anthony L. Marchetta. “Developments financed through Sandy Recovery funds and the Low Income Housing Tax Credits Program provide rental housing units at an affordable cost to deserving individuals and families who contribute a great deal to our New Jersey communities. These projects also provide significant and ongoing sources of income, taxes, and jobs for our state and its municipalities.”
Collectively, the total development cost for Spruce Senior Apartments is approximated to be $17.9 million. It will not only provide high-quality affordable housing opportunities for New Jersey senior citizens, but will also have a positive economic impact on greater Essex County. HMFA estimates that Spruce Senior Apartments will generate approximately $28.3 million in one-time economic output and create approximately 170 full-time jobs and over $1 million in state and local taxes during construction. Once completed, the project will continue to add value to the community by providing more than $3.2 million in ongoing economic output, 18 full-time jobs annually, and approximately $179,000 in state and local taxes.
Additional financing for the development of Spruce Senior Apartments was provided by the City of Newark.
For more information on HMFA programs, including the Fund for Restoration of Multifamily Housing, visit www.njhousing.gov.