Image courtesy of Embarc
A second housing development has secured a financing commitment from the state’s new Momentum Fund.
The financing will advance the development of developer Eden Properties’ Post Allston project, creating 170 new apartments, including 34 new affordable units, plus retail space and a new post office for Allston Square.
The project involves the demolition of vacant single-story commercial structures at 25-39 Harvard Ave. and the construction of a new 6-story apartment building.
The Momentum Fund, administered by MassHousing and created under Gov. Maura Healey’s big housing finance bill last year, is taking a $10 million equity position in Eden’s project, and MassHousing will partner with Berkadia to provide taxable permanent financing from Freddie Mac.
Boston planning officials approved the project, which will rise next door to the Great Scott development, in February 2023.
“This new initiative created by our Affordable Homes Act is helping us increase the production of reasonably priced housing across the state,” Healey said in a statement. “And as a first-in-the-nation state revolving fund, it will continue to work to drive housing production for years to come.”
The Momentum Fund was created under the Affordable Homes Act and seeded with $50 million in public money. Instead of relying on grant and subsidy resources to accelerate housing production, the fund utilizes low-cost capital and private developers. The money from the fund will be loaned out to mixed-income housing developments in small packets to close gaps in their capital stacks with low-cost financing, allowing them to get built faster.
MassHousing aims to support the creation of more than 1,000 new units of multifamily housing with $50 million of state investment capital and is seeking additional private capital to expand the fund. The fund’s first project, the 92-unit Residences at East Milton, was announced earlier this year and the legislation creating the fund included an earmark worth $13 million for The Davis Companies’ 1234 Soldiers Field Road project, also in Allston. That project would have a 395-unit apartment building and 72-unit all-affordable building, and 76 condominiums.
State officials hope that the fund will attract investments from philanthropic sources looking for a return on their investment and a MassHousing spokesperson told Banker & Tradesman that the state hopes to announce the fund’s first private investment in the coming weeks.
“By creating co-investment partnerships with the state and MassHousing, we are able to accelerate production of that crucial middle- and mixed-income housing that our communities need,” said Secretary of Housing and Livable Communities Ed Augustus. “Many times, these are developments that are ready to proceed but have stalled due to changing economic factors. The Momentum Fund will help move them forward and deliver on the Healey-Driscoll Administration’s commitment to growing housing that is affordable to more Massachusetts residents.”
