Berkadia's $219M Fannie Mae loan funds Rangel Houses rehab

Genesis Companies closed a $669 million financing to rehabilitate Rangel Houses, a 984-unit public housing campus in Upper Manhattan, with Berkadia providing $219 million of Fannie Mae-backed first-mortgage debt.

NYCHA and the New York City Housing Development Corporation supplied $214 million of development financing. $94.5 million of federal and state tax credit equity completed the stack, Commercial Observer first reported on Nov. 4. Connect CRE described the credits as historic and identified the vehicle as NYCHA's Permanent Affordability Commitment Together program. Goldman Sachs provided a tax credit investment; its amount was not disclosed.

For a lender pricing a PACT conversion like this one, the agency share is the number that matters: $219 million of first mortgage inside a $669 million capitalization, roughly a third. Subsidy and credits carry the balance. Every unit is reserved for households earning at or below 80% of area median income, per Commercial Observer, so the agency piece is underwritten to restricted household income rather than market rents.

The Fannie Mae loan runs 15 years and includes five years of interest-only payments, and it is expected to blend Rental Assistance Demonstration debt with Section 18 programs, Commercial Observer reported. Berkadia's Matthew Baptiste and Heather Olson arranged the financing.

Rangel Houses opened in 1951 as an 11-acre campus of eight high-rise elevator buildings at 159-16 Harlem River Drive, home to more than 1,800 residents, per Commercial Observer. Genesis plans comprehensive renovations to nearly 1,000 apartments and improvements to playgrounds, commercial space, a senior center, a day care center and a youth center, said Karim Hutson, the firm's president and chief executive.