HPD’s Neighborhood Pillars (Pillars) program provides low-interest loans and tax exemptions to nonprofits and mission driven organizations to acquire and rehabilitate unregulated or rent stabilized housing for low- to moderate-income households.
Who is eligible to apply?
Eligible owners may include limited partnerships, corporations, joint ventures, limited liability companies, 501(c)(3) non-profit corporations, housing development corporations, and individual owners.
Qualified not-for-profit borrowers may also utilize the Down Payment Assistance Fund, operated by Restored Homes Development, LLC, for financial and technical assistance for acquiring properties through Pillars.
What buildings are eligible for the program?
Multiple-dwellings with three or more units that are rent stabilized or unregulated. Properties that have current regulatory agreements with the City of New York, New York State, or the federal government restricting rents and/or household incomes are not eligible for the program. Priority will be given to buildings across the city that are experiencing market pressure and/or that are in distress.
How does the program work?
HPD subsidy is combined with private financing. If acquisition will occur prior to construction and/or permanent financing, the Borrower should plan to finance the acquisition and the acquisition financing may be refinanced by a combination of private financing and HPD subsidy. The maximum subsidy permitted ranges from $110,000 to $180,000 per unit, depending on the other financing used and the rents charged to residents. Higher per unit subsidy requests will be considered on a case by case basis for projects that are located in high cost neighborhoods, however HPD will impose additional regulatory restrictions, including permanent affordability. Projects are generally eligible for a full or partial property tax exemption. Borrowers must enter into a regulatory agreement for at least the term of the loan and/or tax exemption, and must commit to permanent affordability for no less than 30% of the units. Among other requirements, the agreement sets limits on allowable rents and initial household incomes, and requires units to remain rent stabilized. All projects must set aside at least 20% of units for homeless households.
How to apply?
For-profit borrowers and not-for-profit borrowers that choose not to apply to the Neighborhood Pillars Down Payment Assistance Fund must apply to HPD by submitting a proposal for acquisition using the Property Summary Template and Underwriting Template. To receive financing through the program, Borrower must request a soft commitment letter and HPD must issue a soft commitment prior to acquiring a property, which will only be granted at HPD discretion based on a review of the proposed project. HPD highly encourages Borrowers to request feedback on a project prior to making an offer to a seller.
Contact Hollis Savage at SavageH@hpd.nyc.go,v and our team will be in touch to further discuss the program and guide you through the application process.
Not-for-profits interested in using the Down Payment Assistant Fund should contact Restored Homes Development LLC at 212-584-8981 or email@example.com for more information.
The Neighborhood Pillars Down Payment Assistance Fund provides financial and technical assistance to not-for-profit housing organizations with the acquisition of unregulated and/or rent stabilized multifamily properties in New York City for preservation through the New York City Department of Housing Preservation and Development (HPD) Neighborhood Pillars Program. The Neighborhood Pillars Down Payment Assistance Fund is administered by Restored Homes Development LLC (Restored Homes), an affiliate of Neighborhood Restore HDFC.
Who is eligible to apply?
Qualified not-for-profit borrowers may be eligible to access the Neighborhood Pillars Down Payment Assistance Fund to use as a down payment/deposit on a contract to acquire properties as well as to cover limited pre-acquisition costs. To become an eligible not-for-profit borrower, visit the Preservation Buyer RFQ webpage.
The funds must be used for projects that will be financed through the New York City Acquisition Fund and HPD’s Neighborhood Pillars Program, except as otherwise approved by HPD. For more information on eligible projects, please see the Neighborhood Pillars Down Payment Assistance Fund term sheet. For the New York City Acquisition Fund terms see the New York City Acquisition Fund.
How does the loan work?
All borrowers must work with Restored Homes to apply for Neighborhood Pillars Down Payment Assistance Fund loans. Restored Homes will also assess building condition and capital needs, and may additionally provide assistance in identifying properties to bid on, underwriting the project, and moving towards an acquisition loan closing with the New York City Acquisition Loan Fund. The funds may be used for the contract down payment/deposit of up to 10% of the purchase price as well as limited pre-acquisition costs, including third party reports and some legal costs associated with closing on the acquisition.
The loan will accrue interest at 3%, and will have a maximum term of 18 months, with the possibility of 1 six-month extension. The loan is expected to be repaid through acquisition financing at the time of acquisition closing. Additional terms and fees will apply, as outlined in the Neighborhood Pillars Down Payment Assistance Fund term sheet.
How to apply?
Non-profits interested in using the fund may contact: Restored Homes Development, LLC at (212) 584-8981or firstname.lastname@example.org for application information.