NEW YORK CITY-Giving some financial relief to owners of Hurricane-Sandy damaged property in Brooklyn, the AFL-CIO Housing Investment Trust Thursday announced it will provide an $89 million bridge loan to Amalgamated Warbasse Houses. The money will go toward electrical repairs but it also will replenish capital reserves that were depleted by Sandy expenses, according to the announcement.
The debt restructuring allows the cooperative, located in the Brighton-Coney Island community, to save more than $3 million in debt service over the two-year loan period, the announcement states.
Chang Suh, HIT SEVP and chief portfolio manager, in the release calls the financing “a sound investment for our portfolio, one that meets strict underwriting criteria and each of the HIT's direct loan underwriting standards.”
Adds city comptroller John Liu in the announcement, “This investment provides vital funds for Brooklynites to rebuild after Sandy's wrath. New York's hardworking and retired municipal employees are committed to putting their retirement savings into investments that not only offer positive returns, but also benefit the communities they call home.”
In the wake of the storm, residents of the co-op's five 24-story buildings were without lights, heat, refrigeration, elevator service, and other necessities until temporary generators could be installed. The complex is one of New York's largest union-sponsored housing cooperatives.
Flooding also damaged the co-op's retail space. The HIT bridge loan allows the co-op to make repairs while waiting for expected insurance proceeds. To guard against future power losses, the loan will pay for relocating the transformers above the flood plain.
“Amalgamated Warbasse contacted us in January seeking our help,” notes Stephanie Wiggins, HIT EVP and CIO, in the announcement. “After all that the residents had been through, we felt a deep obligation to come to their aid quickly.” By the end of February, the loan was closed. “The HIT had the funds and the flexibility to provide a timely solution,” Wiggins says. The New York City Housing Development Corp. and New York State Division of Housing and Community Renewal worked with the HIT to help expedite the loan.
Amalgamated Warbasse was built in the 1960s as affordable housing for union families, with the backing of the Amalgamated Clothing Workers, a forerunner of today's UNITE HERE. Located on 26 acres, the Mitchell-Lama cooperative consists of 2,585 residential units and 17 ground-floor professional units, as well as a small retail center.
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Rayna Katz
Rayna Katz is a seasoned business journalist whose extensive experience includes coverage of the lodging sector, travel and the culinary space. She was most recently content director for a business-to-business publisher, overseeing four publications. While at Meeting News, a travel trade publication, she received a Best Reporting award for a story on meeting cancellations in New Orleans during Hurricane Katrina.
