Pension Capital Helps Refinance Historic Development on Lower East Side
NEW YORK, Dec. 21, 2010 /PRNewswire-USNewswire/ -- The AFL-CIO Housing Investment Trust (HIT) has made a $90 million investment in the Lands End II development on Manhattan's Lower East Side, a transaction that will allow 490 rental units at the development to continue to be affordable to low- and moderate-income families.
In making the announcement today, the HIT said it had purchased $90 million of the $175 million Fannie Mae multifamily mortgage-backed securities from Beech Street Capital to help refinance the property. The refinancing will allow 490 rental units to remain affordable in the development's two 26-story towers.
With this financing, the HIT has surpassed $500 million in investments in New York City since launching its New York City Community Investment Initiative in early 2002. With support from New York City and its public employee unions, the HIT created the initiative following the 9/11 attacks to help the City attract capital for affordable housing and economic development. Under the initiative and a subsequent workforce housing initiative, HIT financing has helped create or preserve more than 21,000 multifamily housing units for New York City residents. Ninety percent of the units are affordable to low- or moderate-income households.
Of these HIT investments in New York City, nearly $400 million has helped the city maintain the affordability of more than 16,000 units for low- and middle-income households. If the private market had built these same 16,000 units, it would have cost an estimated $5.7 billion, instead of the nearly $400 million invested by the HIT.
"The HIT is pleased to help preserve New York City's affordable rental housing through the investment of union pension capital in projects like Lands End II," said Carol Nixon, director of the HIT's New York City office. "This project demonstrates the HIT's long-standing commitment to improving the lives of New York City's residents through the capital it brings to housing projects in the city's five boroughs."
Lands End II was New York City's first Section 8 family project, developed in 1979 by the Two Bridges Neighborhood Council in partnership with the Settlement Housing Fund. Many of the residents are working or retired union members.
About the HIT
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. 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 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 over $5.9 billion to finance more than 96,000 units of housing nationwide, generating over 65,000 union jobs.
Contact: Michael K. Frisby (202) 625-4328
SOURCE AFL-CIO Housing Investment Trust