Real Estate Weekly
May 6, 2015
The Community Preservation Corporation, Inc. (CPC) announced today the closing of a $40 million loan with funding through Freddie Mac to refinance Cathedral Parkway Towers, a 309-unit Mitchell-Lama project on West 110th Street.
The refinancing will not only lower the development’s annual debt, but also prevent rent increases that would have been unavoidable due to rising operating expenses.
“Cathedral Parkway Towers’ $40 million refinancing comes at a critical time when many hard working families are getting priced out of neighborhoods like the Upper West Side, which cannot afford large-scale losses of affordable rental units. When we brought this project to Freddie Mac, a long-standing partner for more than 20 years, they were eager to help preserve this affordable development for current and future generations.” said Rafael E. Cestero, president and CEO, CPC.
“With critical funding from Freddie Mac, we will continue to work with The United Tenants Association to ensure that Cathedral Parkway Towers remains an island of affordability on Manhattan’s Upper West Side.”
Cathedral Parkway Towers consists of a 22-story building and an 11-story elevator building.
The towers have 43 studios, 50 one-bedroom, 98 two-bedroom, 99 three-bedroom, and 19 four-bedroom apartments, with one two-bedroom apartment reserved for the superintendent.
The development has a 7,200 s/f commercial space that is leased free-of-charge to a nonprofit preschool operating for the benefit of the tenants.
Other amenities include 24-hour security, laundry facilities, a playground, a landscaped common courtyard, a community room, and two underground parking garages with 90 spaces.
The $40 million Freddie Mac loan will maintain affordability by refinancing the existing $35 million mortgage and covering other costs, with the remaining loan proceeds going into a reserve account held by the New York State Department of Housing and Community Renewal (HCR).
The Freddie Mac product offers lower interest rates and more favorable terms compared to its standard products. The refinance will lower annual debt service payments by as much as $1 million.
“There is a lack of affordable housing in America and rents are rising faster than incomes for working families,” said Shaun Smith, senior director of Freddie Mac Multifamily.
“Initiatives like this help preserve affordable rental housing and could not be done without the coordination of many public and private entities like CPC and HCR.”