L+M, Tahl Propp secure $127M Wells loan for Harlem project
Affordable housing development at 1465 Park Avenue to include 400 units
L+M Development Partners and Tahl Propp Equities secured $126.5 million in funding for their East Harlem affordable housing development Lexington Gardens II from Wells Fargo and the New York City Housing Development Corporation.
The partners filed permits for a 400-unit, 15-story rental building in January. Construction is set to begin this month, and the developers plan to complete the project by mid-2020.
The funding package includes $57.8 million in tax-exempt bonds issued by NYCHDC and backed by a letter of credit from Wells Fargo, a $29.5 million construction loan from Wells Fargo, and a $42.8 million equity investment from Wells Fargo’s Affordable Housing Community Development Corporation under the low-income housing tax credit program. The development’s total projected cost is $195 million.
The developers plan to set 80 units aside for those making 27 to 30 percent of area median income, 119 for those making 47 to 50 percent, 40 for those making 57 to 60 percent, 80 for those making between 80 and 90 percent and another 80 for those making between 125 and 165 percent.
“We love the affordable housing game,” said Wells Fargo’s Alan Wiener, adding that the bank has done business with L+M in the past.
Apart from Lexington Gardens, the bank closed loan deals for three other New York affordable housing development in late June. According to Wiener, the bank is backing $46 million in housing bonds and issued a $33 million low-income housing tax credit equity investment to fund an LGBT senior residences building Ingersoll Houses in Fort Greene. Developer BFC Partners will begin work on the project next month.
Wells Fargo also issued a $32 million construction loan and $27 million in equity for Breaking Ground’s La Central housing development and $45 million in bonds and $20 million in equity for Azimuth Development’s Concourse Village project, both in the South Bronx, Wiener said.
L+M is one of the city’s most active affordable housing developers. Last month, a local nonprofit sued to block the Ron Moelis-led firm from buying the East Harlem rental apartment building 1680 Madison Avenue, arguing it should have a right to buy the building first.
(To view more of L+M Development Partners’ financing transactions, click here)