Lument closes $117.4 million Freddie Mac loan for affordable Brooklyn community
Lument announced the closing of an unfunded $117.4 million Freddie Mac term loan for Hope Gardens, a portfolio of affordable housing communities in Brooklyn, New York. The Freddie Mac loan comes with a three-year rate lock and serves as construction financing, covering 949 units in 47 buildings. The transaction was led by Josh Reiss of Lument, director of the affordable housing production team.
“Helping preserve and improve an important source of affordable housing like Hope Gardens is one of
strengths of this profession,” Reiss said. “The fence allows the client to complete the important
rehabilitation of properties at a lower cost, short-term financing and then permanent closure
financing with the tax-free Freddie Mac loan, which offers the advantages of a long-term fixed rate loan
The Freddie Mac loan has a low fixed interest rate, a 30-year term and a 40-year amortization.
Located in the Bushwick neighborhood of Brooklyn, Hope Gardens consists of 60 dispersed multifamily
properties near a community center building. Built from 1980 to 1987, the portfolio
contains 1,321 total units in garden-style, mid-rise and high-rise buildings ranging from three to 14
tall stories. All units are subsidized by long-term Section 8 contracts. In addition to housing
units, the community includes a daycare center and two senior centers.
The sponsor is a joint venture between Pennrose Holdings, Acacia Real Estate Development and a
subsidiary of the New York City Housing Authority (NYCHA). In addition to Freddie Mac’s loan, other
Sources of financing that were part of the transaction included equity from the Low Income Housing Tax Credit (LIHTC),
a seller’s note and deferred developer fees.
The closing marks the first of two financings for Hope Gardens between Lument and the sponsor, as
second portfolio should be closed at the end of July. In total, Hope Gardens will transport approximately
$190 million in permanent Freddie Mac financing once the second transaction is completed.
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