Fairstead, a vertically integrated real estate company and one of the nation’s largest affordable housing owners, and Invesco Real Estate, a global real estate investment manager, have acquired 1,904 affordable units across 48 buildings and 2.3 million square feet in the Bronx.
The deal is the largest deal of its kind in New York this year by both portfolio and investment size, according to the firms. The sales price was not disclosed.
Fairstead is now the owner and property manager of the properties, a mix of five- and six-story existing and newly constructed buildings, some with ground-floor community retail. All the units are operated under a regulatory agreement serving residents earning between 30% and 100% of the area median income (AMI). The firm will preserve the affordability of these units, provide upgrades to the buildings, and deploy social services and community programming.
“Fairstead is committed to creating high-quality, sustainable housing, and an important part of our strategy is preserving and enhancing existing affordable housing stock so it can remain a great place to live for the long term,” said Jeff Goldberg, CEO of Fairstead, in a statement. “We are proud to be serving thousands of Bronx families, giving them peace of mind that their homes will remain affordable and providing them with access to important social services and programming.”
The New York deal is one of several notable transactions for the firm this year.
The portfolio was previously managed by Property Resources Corp. (PRC) and includes properties in Longwood, Tremont, Crotona Park, and Morrisania. PRC is a prominent developer of market-rate and affordable housing in the city, with over 6,500 units representing over $1 billion built or redeveloped throughout its history in addition to a pipeline of more than 2,000 units totaling $600 million of development.
Through Fairstead’s community impact work, the company said it will continue to support the longstanding partnership PRC established with the Renaissance Youth Center in Morrisania and work with local organizations for additional programming.
The transaction was led by Ariel Property Advisors’ Victor Sozio, executive vice president, investment sales, and Shimon Shkury, president, representing both Fairstead and PRC.
“Fairstead and Invesco Real Estate are bringing in new capital to this portfolio through an innovative capital structure that will allow us to make strategic investments to improve the sustainability of the buildings and enhance the lives of residents through social services and programming,” said Brett Meringoff, managing partner, development, at Fairstead.
Berkadia and Deutsche Bank are the capital partners for Fairstead and Invesco Real Estate.
Fairstead recently announced a new $500 million equity commitment to strategically grow the company's operations, including expanding its multifamily housing portfolio and enhancing the firm's proptech, sustainability, and community impact programming.
This purchase is part of the firm’s commitment to creating and preserving affordable housing across the nation. Last week, Fairstead announced the acquisition of Gateway, 160 apartments in Lake Jackson, Texas, where it will preserve and expand its affordability. In November, Fairstead acquired the Essex Plaza portfolio in Newark, New Jersey, adding 691 affordable units to its portfolio. Fairstead will invest more than $27 million for sustainable renovations and improvements, as well as on-site support services for seniors.
The Alexandria Redevelopment and Housing Authority recently announced that it has selected Fairstead in partnership with Mill Creek Residential and The Communities Group to redevelop the Samuel Madden Homes in Old Town Alexandria, where the company will create a sustainable mixed-use community with affordable, workforce, and market-rate housing.