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A New York investment firm specializing in affordable housing is working with local agents to maintain market rents in the nation’s third-most expensive housing market, and its efforts are being reviewed by real estate experts familiar with the market. Winner of the Juried 2024 CoStar Impact Award. .
Purchased by Jonathan Rose Cos. the globe Built in San Jose for $102 million from Nuveen Real Estate with creative financing from Berkadia Commercial Mortgage. Berkadia helped Jonathan Rose secure his $68.5 million affordable home preservation loan with fixed interest rates.
As part of the closing, Jonathan Rose reached an agreement with the local government known as the Bay Area Housing Finance Authority to fix income and rent limits for all 331 units at 80% of area median income. Under this condition, the annual rent increase is also limited to 3%. The company also plans to hire staff and provide social services to support tenants.
According to Coster data, San Jose is the third most expensive city to rent in the country, behind New York and San Francisco. Tenants pay an average of $2,970 per month in this market, home to many employees of the world’s largest technology companies. The Grove is currently asking tenants $2,388 a month.
About the project: As part of the deal, Jonathan Rose agreed to pay $11 million in capital improvements. We are also exploring opportunities to convert gas appliances to electricity through incentive programs.
What the judges said: “In a time of inflation, inventory shortages, and high interest rates, the demand for affordable housing is tremendously high, but by implementing creative and resourceful social service programs, Rose The additional steps taken by will serve as a benchmark for future affordable housing landlords/developers to come,” wrote Devon Stout, vice president of Compass Commercial.
They made it happen: Berkadia Commercial Mortgage is represented by: Managing Director Tim Leonhardt. The Jonathan Rose team included acquisitions associate Margot Besnard; Max Jawer, Senior Director of Acquisitions. Nathan Taft Chief Investment Officer; Lauren Zullo, Managing Director, Impact; Marcela Yee, Construction Project Manager. Michael Brod, Senior Project Manager, Environmental Impact and Strategy. Salvatore Sagrimbeni, Executive Director of Investments;
Ashley McClain, Senior Marketing Manager, contributed to this article.
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