Refinancing Plan Keeps 5,881-Unit Development Affordable and Provides $140 Million in Capital Improvements and Repairs
Builds on Governor's Efforts to Preserve Mitchell-Lama Housing for the Middle Class
Governor Andrew M. Cuomo today announced an agreement with the owners of Starrett City, also known as Spring Creek Towers, to ensure the 46-building, 5,881-apartment Mitchell-Lama housing community in Brooklyn remains affordable through 2069. The plan includes long-term protections for tenants and requires owners to make approximately $140 million in upgrades and repairs. The agreement, which was made under the leadership of New York State Homes and Community Renewal, will improve quality of life for residents and preserve a critical source of housing that thousands of middle-income New Yorkers have relied on for more than 50 years.
"This agreement will help ensure that the residents of one of the largest affordable housing communities in the country will reap both the short- and long-term benefits of having safe, modern, affordable homes," Governor Cuomo said. "The COVID pandemic provided glaring insight into just how crucial affordable housing is - all New Yorkers deserve safe spaces for their families. Providing quality affordable homes is an essential part of our mission to create more opportunities for families and stabilize our communities."
"The pandemic has only reinforced why every New Yorker deserves the decency of a roof over their head," said Lieutenant Governor Kathy Hochul. "Today's agreement will not only preserve affordable housing for thousands of long-time middle-income New Yorkers at Starrett City in Brooklyn, it keeps a strong and much-loved community together for decades to come."
Through an agreement with Brooksville Company and Rockpoint Group, HCR required that any such refinancing agreement would need to achieve three goals: extend affordability for residents, invest in building infrastructure, and continue the cap on rent increases. All three of those goals were achieved in this agreement.
Under the new financing agreement, HCR secured the following terms:
- Continues the cap on rent increases for non-Section 8 tenants.
- Requires owners to apply for an additional 15 years on Starrett City's Section 8 contract with U.S. Department of Housing and Urban Development, keeping the complex's 3,569 apartments for low-income residents affordable through 2069.
- Extends affordability for the complex's 2,312 non-Section 8 apartments for an additional 15 years (assuming the HUD contract for the Sec. 8 tenants and the New York City tax exemption for the development are extended).
- Requires owners to make an additional $140 million in capital improvements and repairs by 2030, bringing Starrett City's total capital commitment to the property since 2018 to $280 million. Repairs include:
- New kitchen appliances for every resident.
- Renovating all lobbies and corridors.
- Replacing the building's streetscapes and upgrading landscaping.
- Upgrading playgrounds and outdoor sports areas
- Creates a $10 million social services fund for residents to provide access to support services that may include: educational, health and wellness, and job training programs.
- Creates a $10 million rent relief fund for residents facing financial hardship.
RuthAnne Visnauskas, Commissioner of New York State Homes and Community Renewal said, "Under Governor Cuomo's leadership HCR is constantly working to find innovative ways to create and preserve the affordable homes that people need. The plan we developed with Starrett City invests $140 million in upgrades, along with $10 million in rent relief and $10 million for support services, health, wellness, and job training. HCR is proud to work with Starrett City to ensure this iconic and much-loved community remains affordable, improves quality of life, and creates opportunities for residents for years to come."
State Senator Roxanne Persaud said, "I applaud Starrett City/Spring Creek Towers residents on a refinancing plan that will give them peace of mind and a safe, affordable place to live now and into the future. We must do all we can to protect tenants and preserve Mitchell-Lama housing so that low-and middle-income families can thrive in our great city."
Andrew MacArthur President, Brooksville Company said, "We are proud to have worked alongside HCR and our local elected officials to create a partnership that extends affordability through 2069, caps rent increases and enables $140 million of new capital to be available for additional community improvements, including important residential upgrades and social services. This is proof that public-private partnerships can work, and we hope this serves as a model for affordable housing around the city."
Governor Cuomo has prioritized preservation and improvement of Mitchell-Lama housing, while maintaining affordability. Since 2011, the Governor has kept more than 23,000 Mitchell-Lama homes affordable. In 2013, he announced the $1 billion House NY Initiative to transform 8,600 aging state-financed Mitchell-Lama communities in critical need of repairs and upgrades into quality, safe, affordable homes by the end of 2018. The Governor's Housing Plan also includes $75 million to the Mitchell-Lama Rehabilitation Program, which makes low-interest loans to Mitchell-Lama developments throughout New York State.