Big Banks Join City in $350 Million Affordable Housing Project
NEW YORK—Mayor Bill de Blasio and other city leaders announced that the Community Preservation Corporation (CPC) has raised $350 million in capital to create and preserve 7,500 units of affordable housing statewide.
The investors in the project include Citi, Morgan Stanley, Deutsch Bank, and the pension funds for New York City Retirement Systems.
“This isn’t philanthropy, this is a business decision and an investment in our hometown,” said Citi CEO Michael Corbat.
Citi invested $75 million in the fund, more than any other organization.
The funds will loaned via the CPC to organizations like the Highbridge Community Development Corporation to finance the renovation of existing neighborhoods and construction of new ones.
“We were going to do something unprecedented,” said de Blasio, whose administration ultimately aims to establish 200,000 units of affordable housing in the next 10 years. “It leverages public and private dollars, maximizing investments of all kinds.”
The New York City Retirement Systems, which encompasses the pension funds for the city’s teachers, police and firefighters, and civil servants contributed $40 million to the project.
“This type of creative public private partnership is crucial to mitigating our affordable housing crisis,” said Comptroller Scott Stringer, who manages the city’s pension funds. “we have to reverse this trend, we can’t have a city with separate enclaves for the very rich and the very poor.”
One of the beneficiaries of the fund is 170 Ogden, a 65-unit multi-family bulding in the Highbridge section of the Bronx.
“This investment was critical for the pension fund to come into, it wasn’t a traditional choice, historically speaking, but we thank you for that,” said Rafael Cestero, CEO of the Community Preservation Corporation.
The mayor was keen to stress not just the scope of the project but the importance of each and every affordable housing unit.
“For that one family who gets an affordable unit, that was stressed constantly struggling to get the money for rent, nothing could be more life changing,” de Blasio said. “It sets that family on an entirely different course.”
Wells Fargo and Morgan Stanley invested $50 million each in the project, and Deutsch Bank $35 million.