LIHC Investment Group, Camber Property Group and Settlement Housing Fund have completed an $85 million acquisition of Lexington Court in East Harlem. The nine-building complex comprises 229 affordable apartments primarily along East 118th and East 119th Streets surrounding Park, Lexington, and Third Avenues.
Most of the buildings were constructed in the 1920s and consist of one- to three-bedroom units and a small collection of studios. As part of the acquisition, LIHC and Camber will undertake $10 million in infrastructure and building system upgrades across the portfolio. This includes substantial plumbing and electric upgrades, a new security and intercom system, masonry and façade repairs, as well as common area improvements.
The new owners have also committed to an extension of the portfolio’s Section 8 Housing Assistance Payment contract, which combined with city-backed regulatory agreements will maintain the properties as restricted-income housing for at least the next 40 years. As a result of the regulatory agreements entered into by the new owners, current and future residents will contribute no more than 30 percent of their monthly adjusted income toward rent.
“This transaction protects a substantial number of affordable units so they may continue to serve the East Harlem community while allowing for renovations that will greatly benefit longtime residents of these nine buildings,” said Andrew Gendron, principal at LIHC Investment Group. “There are very few asset classes with more proven resilience and staying power than affordable housing and competition for deals in the five boroughs remains extremely high.”
To finance the acquisition, the partnership executed a $73.1 million FHA risk-share loan with the New York City Housing Development Corporation and supplied $11.5 million in developer equity.
“Through our partnership with LIHC Investment Group, we look forward to preserving and renovating Lexington Court to deliver the highest quality housing to the residents of East Harlem,” said Rick Gropper, principal and co-founder of Camber Property Group. “By preserving affordability, we ensure the city is accessible for everyone, especially in this community.”