MassHousing announced that residents living at the 432-unit Westminster Village Arms in Lowell will have their affordable rents preserved for the long term and see approximately $20 million in property improvements as a result of $94 million in financing.
Related Affordable, one of the largest private developer and preservationists of affordable housing in the United States, refinanced the property through MassHousing’s Multifamily Accelerated Processing (MAP)/Ginnie Mae Joint Venture program with partner lender Rockport Mortgage Corporation.
“Westminster Village Arms is an important source of affordable housing for residents in Lowell and this transaction will not only preserve their affordable rents for the long term, but significant improvements will be made to the property for their comfort and safety,” said MassHousing CEO Chrystal Kornegay.
“We are proud to work with MassHousing and play our part in preserving the affordability of Westminster Village Arms apartments,” said Matthew K. Finkle, President of Related Affordable. “For over fifty years, Related has been committed to preserving and providing affordable housing and we are thrilled to undertake extensive property improvements to help deliver long term, quality homes to the Lowell community.”
MassHousing offers the MAP/Ginnie Mae loan program to the owners of rental housing through the U.S. Department of Housing and Urban Development (HUD). HUD provides expedited Federal Housing Administration (FHA) insurance approvals through the MAP program. MassHousing has surpassed $2 billion in cumulative MAP lending and the Agency has built the largest MAP lending program of any state housing finance agency in the nation.
The combination of FHA insurance and a Ginnie Mae guarantee enables borrowers to access taxable mortgage financing with lower interest rates, while preserving and extending affordability for hundreds of low-income individuals, senior citizens, and families. MassHousing provided the property owner with a $94 million, 35-year permanent loan.
“With such high demand for safe, affordable housing, we are pleased to work with Related Affordable and MassHousing in preserving the affordability of this important housing asset for the City of Lowell,” said Dan Lyons, Managing Partner of Rockport Mortgage. “In addition to extending the affordability for 20 years, this loan transaction will finance significant in-unit upgrades and property improvements that will enhance the quality of life for residents of Westminster Village Arms.
All 432 apartments at Westminster Village Arms are restricted to households earning up to 60 percent of the Area Median Income (AMI) for at least the next 19 years. Additionally, 400 of the apartments are subsidized by a federal Section 8 Housing Assistance Payment contract that will be renewed for 20 years. There are 36 studio apartments, 180 one-bedroom apartments, 198 two-bedroom apartments, and 18 three-bedroom apartments.
Among the improvements slated for the property are ADA upgrades, sliding glass door replacement, deck repair and replacements, full window replacements, 14 roof replacements, common area flooring replacement, unit kitchen and bathroom replacements, unit floor replacements, electrical upgrades throughout entire property, unit air conditioning replacements, security upgrades, lighting upgrades, exterior site work improvements and parking lot repairs.
The general contractor is Keith Construction, D.A. Kinsella Company is the architect, and the management agent is Related Management Company.
MassHousing has financed 24 rental housing communities in Lowell totaling 4,305 units and $393.2 million in total financing. The Agency has provided home mortgage loans to 2,701 homebuyers and homeowners in Lowell with an original purchase principal balance of $329.1 million.
MassHousing has partnered with experienced MAP lender Rockport Mortgage Corporation. Rockport prepares the submission of each transaction for HUD’s approval. MassHousing then closes the new loan and issues a Ginnie Mae Mortgage Backed Security (MBS), which has consistently provided the multifamily mortgage industry its most competitive long term, taxable interest rates.
With each MAP/Ginnie Mae loan, MassHousing continues as the mortgagee of record and becomes a Ginnie Mae servicer. This ensures affordability, as each completed transaction will require the property owner to rent at least 20 percent of the units to those earning less than 80 percent of the area median income. Affordability at many properties could be at risk were MassHousing unable to offer this product, as owners could refinance with other lenders who do not require affordability restrictions.
