Related Capital provided the equity to developers Maria J. Gonzalez and William Santiago Sastre in exchange for tax credits generated by the development. The bulk of the remaining funds for the $28 million purchase and renovation were provided through loans from the Puerto Rico Housing Finance Authority.
Gonzalez is the founder of MJ Consulting & Development Inc., a management company specializing in multifamily projects subsidized by HUD and Farmers Home Administration. Her company currently manages nearly 4,000 public housing units, including San Martin.
San Martin is situated on 3.4 acres in the northeastern section of Guaynabo, located along the northern coast of the island. Built in 1976, it consists of two 15-story buildings housing one- to three-bedroom apartments ranging from 528- to 830 sf in size, with half of the units featuring balconies. The complex is two miles from the central business district and near public and transportation and shopping.
The rehabilitation plan calls for repainting interiors and exteriors, refinishing floors, refurbishing bathrooms and kitchens as well as installing new doors, windows and rewiring electrical systems. Existing amenities include a community room, Head Start facility, volleyball court, basketball half court and a playground. Free social services will include child daycare, an on-site social worker, physical needs referrals and job placement services.
After the work is complete, the apartments will be targeted toward tenants earning 60% or less of the area's median income, with rents starting at $316 per month. The developers say a Department of Housing and Urban Development housing assistance program may be renewed on the complex, which would lower rents on many of the units to as little as $111 per month.
The transaction is the second financing conducted this year in Puerto Rico by Related Capital, which is trying to carve out a niche in a market.
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