Photo by Steve Adams | Banker & Tradesman Staff
A fund tied to the MBTA Communities law helped an Arlington nonprofit acquire 59 apartments that attracted tenant protests about rent hikes under its previous ownership.
Housing Corporation of Arlington bought the property across from Arlington High School, in late September for $9.3 million.
A key element of the financing package was a grant from the state MBTA Communities Catalyst Fund. The fund provides grants toward affordable housing creation in communities that have approved compliance plans under the state law that requires zoning for multifamily housing near transit stops.
“There were a few factors that made this lucky,” said Andrew Wofford, HCA’s real estate project manager. “[The property] is in an MBTA Communities zone. Without that grant, I don’t know if it would have come together.”
The 840-846 Massachusetts Ave. property is an example of “naturally occurring affordable housing,” said Erica Schwarz, the HCA’s executive director. No legal limits on rent hikes existed, but the rents had remained relatively affordable before the property’s 2019 acquisition by Boston-based Torrington Properties.
Torrington paid $6.9 million for the property, according to real estate records, and began raising rents as part of a repositioning of the property as luxury apartments, Schwarz said.
The company’s business practices attracted the notice of City Life / Vida Urbana, a Boston-based tenant advocacy group that has organized protests at other properties owned by Torrington Properties.
Two years ago, HCA reached out to the developer about its interest in acquiring the Arlington property, Schwarz said. Assembling multiple sources to meet the acquisition price was a lengthy process, and included a $1.1 million loan by Torrington Properties that completed the financing package.
“They knew we were turning over every rock trying to find funds,” Schwarz said.
The town of Arlington approved a $3.5 million catalyst grant toward HCA’s acquisition.
MHIC provided a $14.7 million low interest rate senior loan. Subordinate loans were provided by the Boston Impact Initiative, Eastern Bank and Arlington Affordable Housing Trust.
The acquisition includes a pair of large buildings containing 31 apartments at 846 Massachusetts Ave., 26 apartments at 840 Massachusetts Ave. and a duplex at 17 Newman Way.
Now under HCA ownership, the complex will gradually convert to affordable units available to households earning 30 to 60 percent of area median income. The process is expected to take several years as leases expire and units turn over, HCA executives said.
Torrington Properties did not respond to a request for comment.
