Penn South complex gets $188M refi

HUD signed off on the deal last month

May.May 01, 2017 04:20 PM

Mutual Redevelopment Houses landed a $187.5 million federally insured mortgage to refinance its six affordable housing properties known as Penn South in Chelsea.

Wells Fargo provided the loan for the buildings — 212 Ninth Avenue, 305 Ninth Avenue, 313 Eighth Avenue, 311 West 24th Street, 270 Ninth Avenue and 250 Ninth Avenue — which replaces a $134 million loan from the New York City Housing Development Corporation, the Commercial Observer reported. That financing matures in 2052.

The buildings are part of the 10-building Penn South Co-op Complex, which has 2,820 affordable housing units. Chelsea Now reported last week that the U.S. Department of Housing and Urban Development had signed off on the loan refinancing. Penn South general manager Brendan Keany told the website that the deal will reduce the company’s annual debt service by $3 million, and stave off the interest rates increases.

“We were very concerned that we would have much higher interest rates,” he said. “[It] will safeguard us against future interest rate hikes because the term of this loan is 35 years, and the interest rate is 3.23 [percent].”

In February, the City Council approved extending a tax abatement at Penn South through 2052, which paved the way for the refinancing deal. [Chelsea Now] and [CO] — Kathryn Brenzel

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