$80.4 Million Potrero Launch Project Will Bring 196 Housing Units, New Businesses, Jobs and Affordable Housing to San Francisco's Central Waterfront
Dec 20, 2010, 11:05 ET
SAN FRANCISCO, Dec. 20, 2010 /PRNewswire-USNewswire/ -- Contributing to San Francisco's efforts to increase housing development and business activity in city neighborhoods, Martin Building Company, Citi Community Capital and the AFL-CIO Housing Investment Trust (HIT) have announced financing for the $80.4 million Potrero Launch residences project in the Central Waterfront area. The union-built development will produce 196 rental units, create 200 union construction jobs a year for two years, and provide affordable housing, child care and commercial development.
The announcement was made last week at the South Beach construction site of Arc Light Co. residences, another innovative housing development that includes the HIT and Martin Building Company, which is headquartered in San Francisco.
"Potrero Launch will be a key catalyst for economic development and revitalization at a time when new construction in San Francisco has come to a virtual halt for lack of investment capital," said Patrick McNerney, President of Martin Building Company. "We are fortunate to have investment partners like Citi Community Capital and the AFL-CIO Housing Investment Trust who share our commitment to San Francisco and its residents."
HIT Chief Operating Officer Ted Chandler described the Potrero Launch project as an attractive investment opportunity for the HIT.
"We are pleased to support San Francisco's community revitalization efforts with our combined investments of $35 million in Potrero Launch and Arc Light Co.," he said. For Potrero Launch, the HIT worked closely with Citi, the construction lender, to put together a creative financing package. Citi utilized a Freddie Mac forward commitment to fund the permanent loan. The HIT has committed to purchase $2,585,000 in taxable bonds upon conversion to a permanent loan, with Freddie Mac providing the credit enhancement for both the tax-exempt and taxable bonds.
"Citi Community Capital is committed to expanding the housing choices for San Franciscans," said Mike Hemmens, Director of Citi Community Capital. "We look forward to helping bring high quality multifamily rental housing to the changing Central Waterfront area while creating much-needed construction jobs."
Secretary-Treasurer Mike Theriault of the San Francisco Building and Construction Trades Council declared that the financing agreement for Potrero Launch is good news for construction workers, who face unacceptably high levels of unemployment. The project, to be built by an all-union workforce, is expected to generate more than 200 union construction jobs over the next two years. Theriault commended the HIT's investment of pension capital to help make the project a reality. "We are proud that union pension capital is helping finance this union-built project, which will get many of our members working again," Theriault said.
The HIT's Chandler noted that "with the jobs anticipated from Potrero Launch, the HIT is nearly three-quarters of the way to its goal of creating 10,000 union construction jobs to support economic recovery across the country. We expect to surpass 10,000 jobs by next spring."
To help address the city's shortage of affordable housing, 39 of the 196 rental units at Potrero Launch will be affordable to residents earning up to 30 percent of the area median income. In addition to the rental housing, plans include a restaurant, specialty grocery store, cafe, underground parking, and a child-care center. With its many green features, including almost 18,500 square feet of usable open space, Potrero Launch is designed to be a LEED Certified residential project.
Martin Building Company is a multi-disciplinary design and development firm with special expertise in historic preservation and neighborhood-oriented urban infill development. Architectural design services are being provided by HKS Architects, Inc., and the general contractor is Nibbi Brothers.
Citi Community Capital (CCC) is a premier financial partner with nationally recognized expertise in financing all types of affordable housing and community reinvestment projects. CCC's origination, structuring, asset and risk management staff across the country provides creative financing solutions designed to meet their clients' needs. CCC helps community development financial institutions, real estate developers, national intermediaries and nonprofit organizations achieve their goals through a broad, integrated platform of debt and equity offerings. Additional information may be found at www.citicommunitycapital.com.
The AFL-CIO Housing Investment Trust is a fixed-income investment company registered with the Securities and Exchange Commission. It manages nearly $3.9 billion in assets for approximately 350 investors, which include union and public employee pension plans. Forty-four of these investors are in California. The HIT invests primarily in government and agency insured and guaranteed multifamily and single family mortgage-backed securities. The HIT is one of the earliest and most successful practitioners of socially responsible, economically targeted investing, with a 45-year track record that demonstrates the added value derived from union-friendly investments. The investment objective of the HIT is to provide competitive returns for its investors and to promote the collateral objectives of constructing affordable housing and generating employment for union members in the construction trades and related industries. Since its inception, the HIT has invested $5.8 billion to finance 95,000 units of housing nationwide, generating approximately 64,000 union jobs.
Contact: Michael K. Frisby (202) 625-4328
SOURCE AFL-CIO Housing Investment Trust
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