BROOKLYN, NY – Attorney General Eric T. Schneiderman today joined representatives from Bank of America and Citi to announce commitments by both companies to finance the construction or rehabilitation of more than 2,300 affordable housing rental units in New York City. The financial commitments, which arise out of the multi-million dollar settlements the Attorney General announced last summer, are aimed at helping New Yorkers that were hardest hit by the 2008 housing crash. Statewide, low-interest lending by the two institutions will create or preserve 3,780 affordable housing rental units.
“The construction of new, affordable homes will help entire communities rebuild, by putting more New York families into sustainable, long-term housing,” said Attorney General Eric T. Schneiderman. “My office has been creative in finding new ways to help New Yorkers recover, from today’s announcement of more affordable rental housing, to connecting at-risk homeowners with free legal advice, to giving homeowners the tools they need to avoid scammers. These affordable homes will help thousands of New Yorkers finally get past the housing crisis.”
“For thousands of families that were forced into insecure or unaffordable housing during the recession, the housing crisis isn’t over,” said Mayor Bill de Blasio. “We are making unprecedented efforts to build and preserve more affordable housing than any time in our history, and today’s announcement by Attorney General Schneiderman means relief and security for thousands of New Yorkers. We are deeply appreciative of Attorney General Schneiderman for his work to bring new resources to bear on our affordable housing crisis, and for his ongoing partnership protecting tenants.”
“Expanding the supply of affordable housing is crucial to keeping New York’s communities vibrant and accessible to working and middle class families,” Governor Andrew Cuomo said. “This announcement is another major step forward for our state, and along with efforts like our administration’s $1 billion House NY program, I am confident that we will continue to make New York even more affordable for hard-working people across the state.”
NYC Deputy Mayor Alicia Glen, NYS Department of Homes and Community Renewal Commissioner James Rubin, and many other state and city officials also joined in today’s announcement.
Together, Bank of America and Citi are providing nearly $75 million in investment by providing low-interest loans for 32 affordable housing projects. In New York City, 19 projects will result in 2,360 new or rehabilitated affordable housing units. In the Lower Hudson and Capital regions, six projects will result in 490 new or rehabbed units. In Long Island, three projects will result in 252 new or rehabbed units. The remaining units are spread throughout the Rochester area, the North Country, and central and western New York.
In the aftermath of the housing crisis, affordable rental units are a particularly urgent need. Many foreclosed former homeowners are moving into rental housing and many current renters are being shut out of homeownership by tighter mortgage credit rules. Since 2006, the New York City rental population rose from 61% to 64%, according to a report by NYU’s Furman Center.
More than half of all New York City renters (54%) are rent-burdened, meaning they spend more than 30% of their income on rent. Nearly one in three (30%) spend more than half their income on rent, according to the Furman Center.
The problem is even worse for poor New Yorkers. Nearly three-quarters of low-income renters (71%) spend at least half of their income on rent, according to the Furman report.
The announcement was made in front of the Sunset Park Library in Brooklyn. Thanks in part to low-interest loans from Citi, funding from New York City, the Brooklyn Borough President’s office, and a recent Low Income Housing Tax Credit allocation from New York State, the library site will soon be transformed into an eight-story, mixed-use building, developed by the Brooklyn Public Library and the Fifth Avenue Committee, a nonprofit developer. A dramatically expanded library will occupy part of the second floor, the first floor and basement. The remainder of the building will feature 49 affordable units.
The bulk of the apartments will be affordable for extremely low-income to moderate-income New Yorkers.
Today’s announcement is one of many ways the Attorney General’s office has been helping New Yorkers recover from the housing crisis. Funded with $100 million from the National Mortgage Settlement, the office has sponsored the Homeowner Protection Program (HOPP), which funds a network of more than 85 trusted partners dedicated to providing homeowners with free, qualified mortgage assistance relief services across New York.
Schneiderman’s office also created the Mortgage Assistance Program (NYS MAP), which brings tangible relief to New York homeowners at immediate risk of losing their homes. NYS MAP provides loans of up to $40,000 for families who are struggling to avoid foreclosure by offering them a way, for example, to pay off back property taxes or a second mortgage – debts that have kept them from receiving a mortgage modification. The program has already helped dozens of homeowners stay in their homes.
For more information on programs to help residents hurt by the housing crisis, please visit AGHomeHelp.com.
“We are committed to do everything we can to help expand and preserve the supply of high-quality, safe, affordable housing in communities throughout the City and State,” said Richard Gerwitz, Co-Head of Citi Community Capital. “As a leading provider of affordable housing financing, we will continue to leverage our resources to help build the infrastructure that creates economic growth and opportunities for a broad spectrum of the population.”
“We recognize the need for affordable housing and neighborhood revitalization in New York, and nationally,” said Todd Gomez, community development banking market executive at Bank of America Merrill Lynch. “The soft pay loan program will help create over 1,700 affordable rental units for New Yorkers and allows housing agencies to stretch critical subsidies that will deliver even more affordable family housing across the state.”
“The housing crash that devastated our nation in 2008 and the years that followed wrought havoc on thousands of hard-working Brooklynites,” said Brooklyn Borough President Eric Adams. Thanks to the steadfast determination of Attorney General Schneiderman, our borough will see justice from the actions that led to this crisis, resulting in meaningful financing to build and preserve affordable housing in Brooklyn. Projects like the expansion of the Sunset Park Library, which I am proud to help fund with my capital budget, are being made possible by this unprecedented commitment.”
“New Yorkers were hit hard by the 2008 housing crash. While large financial institutions received assistance, many working families lost their home and were thrust into a difficult housing market,” said Representative Nydia M. Velázquez (D-NY). “This innovative plan will create badly needed affordable housing options for working families.”
“Fifth Avenue Committee and the low and moderate income families we serve are grateful for the Attorney General’s leadership in working with Citi, Bank of America and other financial institutions to ensure that families, of all incomes, can obtain and remain in housing that they can afford. Sunset Park’s families are in desperate need for truly affordable housing and a modern, expanded public library space. FAC is excited that our model project with BPL is one of the beneficiaries of this creative settlement that will help meet New York City’s critical need for affordable housing,” said Michelle de la Uz, Executive Director of Fifth Avenue Committee.
“Developing affordable housing requires strong partners and a tremendous amount of resources,” said NYS Homes and Community Renewal Commissioner/CEO James S. Rubin. “Statewide, there is a great need for this housing: we have no shortage of willing partners and thanks to Governor Cuomo’s leadership, we are engaged in the most ambitious affordable housing plan the state has seen for decades, but our financial resources are finite. In providing these settlement funds, Citi and Bank of America are making good on their promise and playing a role in helping us finance the creation or preservation of thousands of affordable apartments and homes.”
“We are pleased that the settlement agreement puts these funds to work addressing the crisis of affordability that is gripping so many hardworking New York families. These funds will assist in financing the preservation and creation of more than 2,300 affordable homes in neighborhoods throughout our city, helping us to meet the goals of Housing New York while also stretching the City’s precious subsidy dollars further,” said NYC Housing Development Corporation President Gary Rodney. “I thank the Attorney General, Bank of America, and Citi for their continued partnership and focus on the issues related to the affordable housing needs of our city and the protection of its tenants.”
“I applaud the combined efforts of the Fifth Avenue Committee and Brooklyn Public library to create truly affordable housing and a beautiful new library facility in Sunset Park,” said Councilmember Carlos Menchaca. “I hope this project serves as a model for other mixed use development in our community. Attorney General Eric T. Schneiderman’s efforts and those of the participating financial institutions will benefit the families of Sunset Park and throughout the city at a time when mitigating rising rents, gentrification and a lack of affordable units are all urgent priorities.”
“Sunset Park will benefit in many ways from the commitment announced today. New residents and future generations will be able to live in affordable housing and enjoy the mixed use residential buildings that the Bank of America and Citibank are helping make possible,” said Assembly Assistant Speaker Felix W. Ortiz