Hunt Real Estate Capital recently arranged for Fannie Mae financing to support acquisition and rehabilitation of a New York City multifamily portfolio, known as the Betances portfolio. However, this wasn’t average financing for the 1,088-unit NYCHA public housing collection. Rather, these units, located in the Bronx, will undergo conversion through the Rental Assistance Demonstration (RAD) program, offered through the Department of Housing and Urban Development (HUD).
Launched in 2012, RAD is a relatively new tool that allows public housing authorities to leverage public and private debt and equity in order to improve the public housing stock. Through RAD, units move to a Section 8 platform with long-term contracts.
Once units in the Betances portfolio are converted from public housing, renters will receive rental subsidies through two Section 8 voucher contracts.
“By converting through the RAD program, the property receives two 20-year project-based rental assistance contracts, thereby preserving affordability for the next 40 years,” said Joshua Reiss, vice president at Hunt Real Estate Capital.
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