|HUD No. 22-082
HUD Public Affairs
April 28, 2022
SEC. FUDGE, SCHUMER, BOWMAN & HOCHUL ANNOUNCE FED CLOSING OF CO-OP CITY’S HUD LOAN REFINANCE; STATE AND LOCAL GOVERNMENT BACKING SUPPORTS RE-FI TO PROVIDE IMMEDIATE INJECTION OF OVER $100 MILLION DOLLARS TO MAKE REPAIRS & CRITICAL INVESTMENTS IN WORLD’S LARGEST HOUSING COOPERATIVE
The Bronx’s Co-op City To Receive $124 Million To Make Repairs & Upgrades For 45,000 Who Call It Home
Refinance Will Help Keep Co-op City In Tip-Top Shape For Residents In Increasingly Expensive Housing Market
WASHINGTON – United States Department of Housing and Urban Development Secretary Marcia L. Fudge, U.S. Senate Majority Leader Charles Schumer, Congressman Jamaal Bowman, and Governor Kathy Hochul announced today that Riverbay Corporation, the management company for Co-op City, HUD, Wells Fargo, the Mortgage Insurance Fund of the State of New York Mortgage Agency, and NYC Housing Development Corporation closed on the refinancing of Co-op City’s HUD loan, which will maintain long-term housing quality and affordability for the over 45,000 residents. Refinancing provides the housing company with $124 million in proceeds that will be used for capital improvements, including upgrades to the HVAC, façade maintenance, and electrical systems.
“We applaud the successful completion of the refinance for the Bronx’s Co-op City Complex,” said Secretary Marcia L. Fudge. “The Biden-Harris Administration and HUD are committed to stabilizing the housing market nationwide using every tool at our disposal, including utilizing Federal Housing Administration multifamily mortgage insurance as a key financing source. From supporting larger loans in major metropolitan areas to smaller loans in rural communities and suburbs, HUD is proud to be a partner in creating and preserving affordable housing across the country.”
“One of HUD’s top priorities is the preservation of affordable housing, and this refinancing ensures Co-op City remains affordable for thousands of families,” said Alicka Ampry-Samuel, HUD Regional Administrator for New York and New Jersey. “It is also crucial that this development remain safe and residents continue to live in updated, quality units, made possible by HUD FHA’s influx of funds. Co-op City families will benefit from these improvements and will be able to enjoy their community for many years to come.”
“The Bronx’s Co-op City provides an affordable home to more than 45,000 New Yorkers in an increasingly expensive housing market,” said U.S. Senator Charles Schumer. “That’s why I worked to secure a timely refinance agreement for Co-op City, which will help maintain the quality, viability and long-term affordability of this one-of-a-kind community. The deal will also improve the lives of the residents by allowing repairs and other improvements to be made, all while providing affordable housing for generations to come. We haven’t stopped pushing and working with HUD to lock in the refinance and we are proud to announce its closure.”
“Co-op City is truly a one-of-a-kind community, home to the largest affordable housing cooperative in America and more than 45,000 constituents that I am honored to serve,” said Congressman Jamaal Bowman Ed.D (NY-16). “It is imperative that the Co-op City community has the funds needed to maintain their affordable housing and commercial space, which supports all who live there. I am proud to have worked alongside the U.S. Department of Housing and Urban Development under Secretary Fudge’s leadership, Majority Leader Schumer, and Governor Hochul to advance a timely refinance agreement for Riverbay Corp, which will unlock significant capital funds for urgent repairs. Co-op City is a prime example of what cooperative housing can look like across this nation and I look forward to seeing how this loan refinance will continue to support making this community even more sustainable, livable and affordable.”
“My administration is committed to maintaining access to safe, quality affordable housing that enables New Yorkers to live with the dignity they deserve,” Governor Kathy Hochul said. “This transformative injection of capital funding will allow us to modernize Co-op City, the largest housing cooperative in the world, and ensure long-term affordability for its 45,000 residents.”
“This loan will assist us to maintain our buildings and infrastructure while reducing the need for our residents to pay huge fee increases,” said Co-op City Board President Bernard Cylich. “On behalf of the Board of Directors and residents, I want to thank all of the government agencies and elected officials who have supported us and worked together to get this loan closed.
“Wells Fargo is pleased to have again structured the long term financing for Co-op City,” said Alan Wiener, Head of Multi Family Capital for Wells Fargo. “Our commitment to providing long term financing for affordable and moderate income housing is unparalleled in the industry. We would like to congratulate our elected partners Senator Schumer, Representative Bowman and Governor Hochul, as well as our agency partners at HUD, New York State, and New York City who worked with us to make this possible.”
“I am enormously proud of this partnership that will protect affordable homeownership at Co-op City for another 35 years,” said Homes and Community Renewal Commissioner RuthAnne Visnauskas. “In addition to keeping maintenance fees stable for residents, the $621.5 million loan will finance much-needed capital repair projects to ensure that all 15,372 homes remain safe and secure for the long term. Generations of New Yorkers have benefitted from the ability to live affordably in this bustling and diverse community while building equity to pass down to their children. Thanks to our private and public partners, Co-op City will continue to deliver economic opportunities for the Bronx’s hard-working families for decades to come.”
“The refinancing of Co-op City represents a critical investment in our existing affordable housing stock at a time of urgent need,” said HDC President Eric Enderlin. “Thanks to the collaboration of our partners and elected officials, this preservation effort will ensure lasting affordability and extensive capital repairs that will provide housing stability and improved quality of life to the thousands of New Yorkers that reside in this dynamic community.”
The 2012 Wells Fargo mortgage loan to Riverbay Corporation, which owns Co-op City, was the largest ever insured under the Department of Housing and Urban Development’s Sec. 223(f) program, which protects lenders against loss on mortgage defaults at multifamily properties.
The restructured $621.5 million mortgage loan from Wells Fargo extends the term of affordability for an additional ten years and provides $124 million for the cooperative to undertake necessary capital repairs. With 15,372 homes, Co-op City is the largest cooperative housing development in the world. The Mortgage Insurance Fund of the State of New York Mortgage Agency, which is part of New York State Homes and Community Renewal, and the New York City’s Housing Development Corporation, will provide credit support with $55 million and $15 million coverage of the loan, respectively. The loan includes $15 million for immediate capital repairs, including approximately $10 million for balcony and façade repair, $2.5 million for the replacement of residential water pumps and $2.5 million for the replacement of garage elevators. The loan also includes $109 million to replenish a reserve account for future repairs, all without raising maintenance charges for residents.
Co-op City is home to over 45,000 residents on 320 acres – the single largest co-op development in the country. The site has multiple schools, three commercial malls, and its own power plant. It has provided tens of thousands of families the opportunity to grow up in a stable middle-class community. This refinancing arrangement will help ensure tens of thousands more have that same opportunity and provide proceeds to make capital investments that will benefit residents for years to come.
The New York City Housing Development Corporation (HDC) is the nation’s largest municipal Housing Finance Agency and is charged with helping to finance the creation or preservation of affordable housing for New Yorkers. HDC also serves as a key financing partner in the rehabilitation of our city’s public housing stock under the NYCHA Permanent Affordability Commitment Together (PACT) initiative. Since 2003, HDC has financed more than 201,000 housing units using over $28 billion in bonds and other debt obligations and provided in excess of $3 billion in subsidy from corporate reserves and other available funds held by the corporation. HDC ranks among the nation’s top issuers of mortgage revenue bonds for affordable multi-family housing on Thomson Reuter’s annual list of multi-family bond issuers. In each of the last five consecutive years, HDC’s annual bond issuance has averaged $2 billion. For additional information, visit: https://www.nychdc.com/.