BOSTON—MassHousing recently closed on its largest loan for a private transaction to preserve affordable housing.
Rhode Island Housing, LLC, a subsidiary of Providence Realty Investment, borrowed $125 million to purchase 10 existing affordable communities from Equity Residential.
Nearly one-third of the 931 apartments involved were at risk of converting to market rents, according to MassHousing.
Officials said they believe the deal is the largest private housing preservation transaction in state history. Several public housing renovation projects have received larger loans.
“It is unusual that we have the opportunity to preserve a whole portfolio of affordable housing in one transaction,” said MassHousing Executive Director Thomas Gleason. “This is one of the most complex transactions in our 45-year history, but we’re pleased that we have the technical expertise to get it done, especially when every unit of affordable housing is critical.”
Equity Residential put the portfolio up for sale last year. At least 360 units were eligible to opt out of their affordable restrictions.
The new transaction will ensure that rents will remain affordable for lower-income renters for at least another 60 years.
MassHousing originally financed all 10 properties between 1979 and 1984. They are privately owned and managed but are subsidized by federal Sec. 8 contracts.
The properties involved in the deal are:
- Cedar Glen in Reading, $17.4 million in loans for 114 units of elderly housing;
- Glen Grove in Wellesley, $22.9 million in loans for 125 units of elderly housing;
- Gosnold Grove in Falmouth, $2.3 million in loans for 33 units of family housing;
- Nehoiden Glen in Needham, $11.6 million in loans for 61 units of elderly and family housing;
- Chestnut Glen in Abington, $16 million in loans for 130 units of elderly housing;
- Heritage Green in Sturbridge, $12.1 million in loans for 130 units of elderly and family housing;
- Noonan Glen in Winchester, $2.5 million in loans for 18 units of elderly housing;
- Norton Glen in Norton, $18.2 million in loans for 150 units of family housing;
- Longfellow Glen in Sudbury, $14.7 million in loans for 120 units of elderly and family housing; and
- Old Mill Glen in Maynard, $7.3 million in loans for 50 units of family housing.