JAIR LYNCH Development Partners recently closed on a financing package that will enable the renovation of The Paul Laurence Dunbar Apartments, a rental community for seniors located in Washington, D.C.
The financing completes Phase II of what JAIR LYNCH calls its “master plan” for the 171-unit community, which began after the company partnered with the Paul Laurence Dunbar Residents Association to purchase the property for nearly $25 million last year after the previous owner notified tenants of its intents to sell the property.
Since then, the development company says it has been working on a package of debt and equity to facilitate the rehabilitation of the 40-year-old property.
“This will be our seventh project in and around the U Street Corridor in the last ten years,” noted Jair K. Lynch, company president. “We are proud to be a leader in the transformation of the neighborhood. We have created the long term commitment to affordably priced, transit-oriented, quality senior housing that we and PLDRA originally envisioned and our joint efforts facilitated.”
Plans for renovation, which are expected to start immediately, include a new HVAC system, lobby and common area improvements, and approximately $25,000 per unit that will go toward kitchen, bath, and finish upgrades. JAIR LYNCH says current residents will be protected by a new affordable housing covenant that will last for 30 years.
Financing for the rehabilitation comes in several forms, including Housing Revenue Bonds insured by the U.S. Department of Housing and Urban Development (HUD) through the Federal Housing Administration’s 221(d)(4) mortgage insurance program; tax-exempt bonds issued by the D.C. Housing Finance Agency through the U.S. Treasury Department’s New Issue Bond Program, which was implemented under the Housing and Economic Recovery Act of 2008; and taxable GNMA mortgage backed securities.
Additionally, PNC Real Estate is providing equity through Low Income Housing Tax Credits, and HUD extended an existing Section 8 contract for 20 years; the District of Columbia also issued a 40-year real estate tax abatement for the property.
The mortgage for the property’s rehabilitation was through Deutsche Bank Berkshire Mortgage, with Holland & Knight as counsel and the Reznick Group serving as the financial structuring and tax advisor. Bozzuto Construction, WDG Architecture, and Kettler Managment will work together to develop the project.
Written by Alyssa Gerace