BOSTON – July 26, 2022 – MassHousing has closed on $10 million in affordable housing financing to Preservation of Affordable Housing (POAH), to refinance the 65-unit Chestnut Gardens Apartments in Lynn and extend affordability protections for lower-income senior citizens and residents with disabilities living at the property for at least 25 years.
"Chestnut Gardens in Lynn is an affordable housing resource for seniors and residents with disabilities. We are pleased that this transaction will preserve and extend affordability at Chestnut Gardens for at least 25 years," said MassHousing Executive Director Chrystal Kornegay. "POAH was committed to ensuring the residents of Chestnut Gardens will continue to have quality affordable apartment homes that create housing stability and offer economic opportunity."
"POAH was pleased to work with Rockport Mortgage, MassHousing and HUD for the refinancing of Chestnut Gardens, which will help us extend the Section 8 subsidy contract and make upgrades that further address the needs of seniors and disabled individuals at Chestnut Gardens. This is one of several affordable housing communities that POAH has refinanced or will refinance with the support of the MassHousing MAP/Ginnie Mae Joint Venture refinancing program in Massachusetts," said POAH CEO Aaron Gornstein.
As part of the transaction, POAH executed a new 20-year federal Section 8 Housing Assistance Payment Contract for the 65 apartments at Chestnut Gardens. The contract will renew for an additional five years, which is the number of years remaining on the previous contract, for an overall extension of affordability of 25 years.
"Chestnut Gardens' location and unique amenities are well suited to serve the needs of its elderly population," noted Dan Lyons, President of Rockport Mortgage. "We're very pleased to have worked with POAH and MassHousing to refinance and secure the affordability of this important housing asset within the city of Lynn for years to come."
Chestnut Gardens was originally constructed in 1895 and was substantially rehabilitated in 1982, with another renovation in 2008. The four-story building contains 55 one-bedroom and 10 two-bedroom apartments.
Chestnut Gardens was refinanced through MassHousing's Multifamily Accelerated Processing (MAP)/Ginnie Mae Joint Venture Initiative with lender partner Rockport Mortgage Corporation. MassHousing offers the MAP/Ginnie Mae loan program to the owners of rental housing through the U.S. Department of Housing and Urban Development (HUD). HUD provides expedited Federal Housing Administration (FHA) insurance approvals through the MAP program. MassHousing has surpassed $1.75 billion in cumulative MAP lending and the Agency has built the largest MAP lending program of any state housing finance agency in the nation.
The combination of FHA insurance and a Ginnie Mae guarantee enables borrowers to access taxable mortgage financing with lower interest rates, while preserving and extending affordability for hundreds of low-income individuals, senior citizens, and families. MassHousing is providing POAH with a $10 million, 35-year permanent loan.
MassHousing has financed 25 rental housing communities in Lynn involving 3,941 housing units with an original loan amount of $267.9 million. The Agency has also provided $430.5 million in financing to 2,941 Lynn homebuyers or homeowners.
About MassHousing's MAP/Ginnie Mae Initiative
MassHousing has partnered with three well-known and experienced MAP lenders CBRE, Capital One and Rockport Mortgage Corporation. The MAP lender prepares the submission of each transaction for HUD’s approval. MassHousing then closes the new loan and issues a Ginnie Mae Mortgage Backed Security (MBS), which has consistently provided the multifamily mortgage industry its most competitive long term, taxable interest rates.
With each MAP/Ginnie Mae loan, MassHousing continues as the mortgagee of record and becomes a Ginnie Mae servicer. This ensures affordability, as each completed transaction will require the property owner to rent at least 20 percent of the units to those earning less than 80 percent of the area median income. Affordability at many properties could be at risk were MassHousing unable to offer this product, as owners could refinance with other lenders who do not require affordability restrictions.
Preservation of Affordable Housing is a Boston-based nonprofit organization that owns and operates more than 12,000 affordable homes at 120 properties in 11 states and the District of Columbia. POAH has rescued and restored some of America's most “at risk’’ rental housing and is known nationally for its ability to develop innovative financing structures and to close complex deals which preserve long-term housing affordability for seniors, individuals with disabilities and families priced out of the housing market. For more information please visit www.poah.org.
About Rockport Mortgage Corporation
Rockport Mortgage Corporation is a privately-owned commercial mortgage banking firm founded in 1992 and located on the North Shore of Boston. Rockport specializes in providing FHA-insured loans to market-rate, affordable and senior housing communities and healthcare facilities through the Department of Housing and Urban Development (HUD) and has been approved under HUD’s Multifamily Accelerated Processing (MAP) Program since the program inception in 2001. The Rockport team works collectively to navigate the complexities of FHA/HUD-insured finance programs, developing strategic solutions to meet the needs of our clients. For more information about Rockport Mortgage Corporation please visit www.rockportmortgage.com.
MassHousing (The Massachusetts Housing Finance Agency) is an independent, quasi-public agency created in 1966 and charged with providing financing for affordable housing in Massachusetts. The Agency raises capital by selling bonds and lends the proceeds to low- and moderate-income homebuyers and homeowners, and to developers who build or preserve affordable and/or mixed-income rental housing. MassHousing does not use taxpayer dollars to sustain its operations, although it administers some publicly funded programs on behalf of the Commonwealth. Since its inception, MassHousing has provided more than $27.5 billion for affordable housing. For more information, follow us on Twitter, Facebook and LinkedIn.