Tenant-Owned Affordable Dev Lands $114M of Financing in DC

An affordable housing project spearheaded by tenants in Washington, D.C., took a critical step forward with obtaining financing.

The D.C. Housing Finance Agency issued $48.3 million in tax-exempt bonds to the joint venture for a development at 1425 Harvard Street NW, led by the Columbia Heights Village Tenant Association, the Commercial Observer reported. NHP Foundation and Change All Souls Housing are also part of the development team.

The agency also underwrote $34.9 million in federal credit and $6.8 million in D.C. Low-Income Housing Tax Credit equity for the project — bonds secured by Department of Housing and Urban Development insured loans — which is dubbed Harvard Court Apartments.

The project landed an additional $24.3 million from the D.C. Department of Housing and Community Development, which lent through its Housing Production Trust Fund. The financing amounts to $114 million in total.

The venture purchased the parking lot site three years ago for $12.5 million through the Tenant Opportunity to Purchase Act, or TOPA. The policy grants tenants the first chance to acquire properties being marketed by their landlords.

Harvard Court Apartments will feature 108 apartments, earmarked for those earning between 30 and 50 percent of the area median income. More than 20 percent of the units will be designated as permanent supportive housing units.

“Bringing new affordable housing to Columbia Heights is about more than building units — it’s about protecting the diversity and vitality that give this neighborhood its soul,” Christopher E. Donald, DCHFA executive director, said in a statement.

TOPA may soon be reformed in the nation’s capital. Last week, the City Council advanced a scaled-back version of a bill called the RENTAL Act.

The council’s version of the bill shortens the window of exemption to the law for newly-constructed buildings to 15 years — down from the 25 years the mayor originally proposed — but keeps her proposed carveout for owners who sign 20-year affordability agreements. That could loosen one of the region’s biggest blocks on multifamily investment.

The legislation heads to a second and final vote, likely in mid-September after the Council’s August recess.

— Holden Walter-Warner