A $100 million affordable housing fund is expected to invest in financially distressed buildings in Northern Manhattan and the outer boroughs. Citigroup is putting up nearly all the money for the fund. L+M Development, a residential builder, will manage the fund.
David Dishy of L+M says the fund will help developers of affordable housing obtain financing.
Affordable housing groups are cautiously optimistic about the fund. The Association for Neighborhood Housing and Development has long criticized private equity firms and other private investors for paying too much for buildings in poor neighborhoods, creating pressure to raise rents, which drives out lower paying tenants. Many of these buildings also end up in foreclosure.
Dishy expects the fund will help affordable housing developers compete for some of those foreclosed properties. Dishy says between 2,000-3,000 apartments will be preserved over three years and rents will be affordable for people earning between 50 and 80 percent of the area median income.