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Pennrose, Acacia land $117M Freddie Mac loan in Bushwick

Financing for joint venture covers affordable housing development

314 Wilson Avenue in Bushwick, Pennrose Holdings' Mark Dambly (Pennrose Holdings, Hope Gardens)
314 Wilson Avenue in Bushwick, Pennrose Holdings' Mark Dambly (Pennrose Holdings, Hope Gardens)

A joint venture including Pennrose Holdings and Acacia Real Estate Development has landed a nine-figure loan for an affordable housing portfolio in Bushwick.

Freddie Mac provided the $117.4 million unfunded forward loan for the Hope Gardens portfolio, the Commercial Observer reported. The Brooklyn portfolio is owned by Pennrose, Acacia and a NYCHA affiliate.

The loan is serving as construction take-out financing and has a three-year rate lock, according to the publication. The loan has a low, 30-year fixed-interest rate with a 40-year amortization. The developers also landed low-income housing tax credit equity, a seller note and a deferred developer fee.

The portfolio includes 60 multifamily properties built in the 1980s and surrounding a community center. It includes 1,321 units in buildings ranging from three to 14 stories. Every unit is subsidized by long-term Section 8 contracts, among the most reliable federal funding streams for affordable housing.

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Additional features of the portfolio include a day care and two senior centers. The financing will go toward the rehabilitation of portfolio properties, the Observer reported.

A second financing for Hope Gardens is set to close later in the month. The portfolio will carry about $190 million of Freddie Mac permanent financing when the second deal closes.

A Lument team led by Josh Reiss arranged the latest financing.

NYCHA has been the recipient of large loans in the outer boroughs recently to upgrade its facilities. In January alone, NYCHA received $1.35 billion in public-private initiatives to repair public housing facilities in Brooklyn, including the Williamsburg Houses, the Linden Houses and Penn-Wortman properties in East New York and three additional publicly owned complexes with 1,673 apartments across 29 buildings in East New York.

Last year, Philadelphia-based Pennrose appeared to be the seller behind a 142-unit rental complex deal in Fort Lee, New Jersey. Blue Diamond Equities and Skywood Properties teamed up to buy The Pinnacle for $55 million.

— Holden Walter-Warner

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Affordable HousingBushwickCommercial Real EstateFreddie MacNYCHAReal Estate Finance