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Hudson Valley Property Group, one of the nation’s largest affordable housing preservation firms, has secured $208 million in debt and equity financing to acquire a five-property portfolio of more than 1,100 units across the Washington, D.C., and Charlotte, N.C., metropolitan areas.
Hudson Valley Property Group (HVPG) used its firm’s own equity fund to finance the acquisition through the agency lending arm of JLL (JLL), which originated the Fannie Mae (FNMA) debt. A JLL team also arranged the financing on behalf of the sponsor.
HVPG officials didn’t disclose the debt/equity breakdown in the $208 million total.
The deal brings HVP’s affordable housing portfolio up to 10,650 units across 65 apartment complexes in the Northeast, mid-Atlantic and Southeast.
HVPG said it plans to spend $13 million to renovate the five properties through site upgrades and improvements to the kitchen and bathrooms.
Jason Bordainick, co-founder and managing partner of HVPG, told CO that the $13 million in renovations is merely the initial assessment and that “significantly more” will be done to improve the portofolio during the firm’s hold on the properties.
“A lot of these properties hadn’t been renovated in some time, so there was a need there,” said Bordainick. “This deal was a chance for us to make a big impact in improving the quality of life and the quality of the asset and really adding value for both the residents and our investors.”
The $208 million acquisition of 1,140 units predominantly encompasses apartment complexes around D.C. While 150 units are part of Village Square Apartments in Gastonia, N.C. — a city just west of Charlotte — the rest of the portfolio features affordable housing complexes in the Maryland cities of Rockville, Capitol Heights and Seat Pleasant, all within the Washington metropolitan area.
As part of the deal, HVPG has secured government regulatory agreements with the Department of Housing & Urban Development (HUD), Prince George’s County, and Fannie Mae to ensure the portfolio remains affordable for renters between 23 and 37 years old, Bordainick said.
“We’re a mission-based organization. This is all we do,” he said. “We have a real passion for preserving affordable housing and making each project better than the next. We’re excited to be in these communities.”
Since its founding in 2010, HVPG has secured or deployed $382 million in equity and $251 million of tax-credit equity into either acquiring or rehabilitating affordable housing projects across the U.S., according to the firm’s website.
Brian Pascus can be reached at bpascus@commercialobserver.com
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