Fairbank sells for $ 11 million; Planned rehabilitation
A California-based affordable housing developer bought a senior apartment complex in Fair Haven for $ 11.1 million – and is seeking local tax relief for a $ 7 million drug rehab.
This building is the Fairbank Apartments at 355 Ferry St.
According to the city’s land registry database, on April 9, Fairbank Community Partners purchased the nine-story, 121-unit building from RAHF Fairbank Preservation LLC for $ 11.1 million.
The apartment complex last sold for $ 8.3 million in 2015, and the city last valued it at $ 8.2 million.
The new owners also applied to the Board of Alders for a 17-year tax break that would limit local property taxes to $ 1,500 per unit per year on their newly acquired property in Fair Haven. This amount would increase by 3% each year during the term of the agreement, if approved by the entire Alder Council.
The Town Planning Commission unanimously approved the proposed tax break, which is now to be heard and voted on Tuesday evening by the Alderman tax reduction committee.
Planned rehabilitation of $ 7 million; All 121 affordable units
The new owner company is a subsidiary of Community Preservation Partners (CPP), which in turn is the affordable housing preservation and rehabilitation arm of developer WNC based in Irvine, California.
The former owner of Fairbank is a holding company controlled by New York-based Jonathan Rose Companies.
In a series of recent emails sent to The Independent, RPC Senior Director of Development John Arthur Richard Fraser and RPC Senior Vice President Seth Gillis said the new owner has big plans for Fairbank.
These include restricting the resort’s 121 apartments for the next 30 years to affordable rents for tenants earning no more than 50 and 60% of the area’s median income (IAM), or for families of four. earning between $ 45,900 and $ 55,080 per year.
Currently, Fraser said, 100 of the property’s 121 units are reserved for tenants making no more than 80% AMI, with the remaining 21 units being leased at market rates.
Fraser said 100 of the units in the complex are funded by federal grants under the Section 8 rental projects. He added that the RPC’s planned deepening of Fairbank’s current affordability stems from a new 20-year contract between RPC and the Federal Department of Housing and Urban Development (HUD) and tax credits for low-income housing (LIHTC) provided by the Connecticut Housing Finance Agency (CHFA).
Fraser also said the RPC plans to invest more than $ 7 million in renovating the entire Fairbank building.
This planned renovation includes the remodeling of the 121 units, making 10% of the units in the complex fully accessible in ADA, energy efficiency upgrades, the installation of new bike racks and nurse call systems in the area. ‘unit and picnic area, provision of free Wi-Fi, renovation of community hall. and a business center and laundry room, covering the costs of all utilities and offering a “robust” resident services program.
“RPC is a mission-driven organization that believes in providing safe and secure affordable housing to all who need it,” said Gillis when asked why RPC decided to purchase the building. Fairbank Apartments. “Our goal is to enrich lives and strengthen communities, so that people – including our seniors – can legitimately have a place to call home. As we continue to grow our portfolio of East Coast communities, we feel privileged to use our deeply rooted expertise in housing preservation to serve the New Haven community.
Tenant Take: The renovations seem “perfect”
Outside the Fairbank Apartments complex at Ferry Street and Grand Avenue, a handful of current residents have praised the renovation plans from the new owners and generally hailed the complex as an affordable, quality place to live.
“They’re going to reshape everything,” Fabian Rosario said with approval. “New kitchen, new stove, new refrigerator, everything.”
He said he is currently paying $ 231 for his share of the rent for a one-bedroom apartment in Fairbank, where he has lived for the past four years. He said his only source of income was Social Security disability benefits.
His short answer to the improvements planned by the CPP for the building: “Perfect”.
Ramon Lopez also enthusiastically welcomed the planned improvements to the building. “It’s good and I’m happy it’s better,” he said.
Lopez said he too was disabled by Social Security. He said he had lived in Fairbank for two and a half years. Lopez said most residents of Fairbank live on Social Security alone.
When asked how he liked living in Fairbank, he smiled and then waved to Grand Avenue. “It’s better than the street,” he says.
17 year tax break requested; $ 1,500 per unit per year
To help fund these renovations and three decades of affordability restrictions in Fairbank, the RPC also applied to the city for 17-year tax relief.
The terms and financial details of this requested tax break are set out in a 22-page document provided to Alders by Barry Cunningham of Clarus Global Alliance on February 23 when the RPC was under contract to buy apartments in Fairbank.
“The parent owner, Community Preservation Partners, is an accomplished developer of affordable housing with numerous developments and properties across the country,” Cunningham wrote in the local tax relief request. “They are planning a $ 7,048,250 renovation that will keep 121 units – all
which will be 100% equal to or less than the 60% Regional Median Income (AMI) as established by HUD. Given the limitations of current operations with regulated housing, they need assistance in the form of payment in lieu of taxes (PILOT). “
Click here to read the full tax relief request.
According to the tax relief request, the CPP is seeking the city to limit local property taxes at 355 Ferry St. to $ 1,500 per unit per year, or $ 181,500 in total, for the duration of the 17-year agreement. years. This unit amount paid to the city would increase by 3% each year over the 17 years of the deal, if approved by the alders.
The tax relief document also states that the complex currently consists of 106 one-bedroom apartments with a net leasable area of 485 square feet and 15 two-bedroom apartments with a net leasable area of 675 square feet.
The current average monthly rent for one-bedroom apartments is $ 1,120, while the average post-construction rent for these units will be $ 1,704. The current average monthly rent for two-bedroom apartments is $ 1,451, while the average post-construction rent for these units will be $ 1,973.
At last Wednesday’s regular monthly City Planning Commission meeting, local planning commissioners unanimously approved the proposed tax break.
But not before remembering why a request for tax relief for a local affordable housing complex would go to the local planning commission in the first place.
“I believe the article is mentioned [the City Plan Commission] because it’s usually real estate in the city of New Haven, ”said Anne Hartjen, a staff member with the City Planning Department.
Westville Alder and city planning commissioner Adam Marchand agreed. “We have seen a number of these tax reduction agreements come before this commission,” he said. “They generally support affordable housing.”
Ultimately, he said, the Alder Council is the city’s fiscal authority, and it is up to the alders to make political decisions about whether what is earned through tax relief is enough for what is lost.
The question before the City Planning Commission, he said, should be: Does this advance the goals of the overall city plan? “Is he looking for a political end that is reflected in a future shape of the city we want?”
“Promoting the creation of more affordable units is clearly part of our overall plan. It is a value that is close to our hearts. “
From this point of view, he encouraged the committee to report favorably to the Council of Alders on the proposed tax relief.
Before voting with the rest of her colleagues in favor of the proposed tax break, Town Planning Commission Chairperson Leslie Radcliffe urged fellow Commissioners, town staff and the alders more broadly to ask themselves a key question before signing such a tax break.
Look at the actual rental rates renters will be facing, she said. Look at how the MAI is calculated regionally and the disparities between that number and the real incomes of low-income New Haveners. Look at how much in tax dollars the city will have to forgo if it gives a 17-year break.
“We’re always talking about affordable housing,” Radcliffe said. “The question being: affordable for whom?”