A "robust toolbox" of financing programs helped a New York City agency sell $1.3 billion of bonds in fiscal 2016 to help further Mayor Bill de Blasio's affordable housing initiative, said its president.
"At the start of this current administration and after drafting the housing plan, we changed all of our programs," said Gary Rodney, president of the New York City Housing Development Corp., the nation's largest municipal housing finance agency. The variety of programs, he said, has enabled HDC to spur groundbreaking new developments while preserving the quality and affordability of existing housing.
Last week, de Blasio announced that his administration, which began in January 2014, secured 23,284 affordable apartments and homes during fiscal 2016, which ended June 30 – the second highest production in city history and the most since Ed Koch was mayor.
That puts the mayor's five borough, 10 year plan called Housing New York ahead of schedule with 52,936 affordable homes financed so far – enough for 130,000 New Yorkers. De Blasio released his findings while in Philadelphia for the Democratic National Convention. Housing New York is intended to create or preserve 200,000 units over 10 years.
"This is a significant milestone in our effort to make this city fairer and more affordable for everyone," said de Blasio.
Rodney, in his second tenure with HDC after de Blasio appointed him and the board approved him early in 2014, said the agency has expanded beyond its "plain vanilla" tax exempt, fixed rate serial bonds. Packages include recycled bonds, private placements and even a forward starting swap, the latter used to obtain financing for a new development, 148th Street Jamaica, in Queens.
"He's extremely excited," Rodney said of the mayor. Rodney expects his agency to issue another $1 billion or so bonds for fiscal 2017.
148th Street Jamaica, in conjunction with Artimus Construction, marks an expansion of a program it is undertaking with the U.S. Treasury Department's Federal Financing Bank.
Last year, Rodney launched sustainable neighborhood bonds, a first of its kind in affordable housing nationwide that focuses on creating diverse and sustainable neighborhoods while attracting new interest from investors known for targeting other socially and environmentally beneficial products.
Investor feedback has been positive, according to Rodney.
"They never knew how involved our programs are in the neighborhoods," said Rodney, a former executive vice president for development at real estate company Omni New York LLC.
Standard & Poor's and Moody's Investors Service rate the agency AA plus and Aa2, respectively.
The state legislature created HDC in 1971 to finance affordable housing independent from the city's capital budget. While it operates independently from the city's Department of Housing Preservation and Development, HPD commissioner Vicki Been chairs HDC's board and the two agencies collaborate to finance the city's affordable housing stock.
To meet the goals of Housing New York, de Blasio doubled the capital funding for HPD, which is running point for de Blasio's program. The 10year
capital plan included nearly $7.5 billion for affordable housing and more than $1 billion in funding for related infrastructure including libraries, parks and road construction.
Major progress areas, according to city officials, include new rules for growth, notably the City Council's adoption of the mandatory inclusionary housing program, which requires developers to create permanently affordable housing as a development condition in areas rezoned for growth.
The city also created more apartments for the lowest income families, exceeding its 8% target.
Aggressive preservation moves ranged from Stuyvesant Town/Peter Cooper Village and Riverton Houses in Manhattan to four story walkups in Prospect Heights, Brooklyn.
In addition, the city was able to expand stable housing for people formerly homeless, provide job opportunities and add low income senior housing, said Rodney.
