NEW YORK, N.Y. – January 29, 2009 – (RealEstateRama) – The Federal Home Loan Bank of New York(FHLB-NY) has purchased $140 million in taxable bonds issued by the New York City Housing Development Corporation (HDC) to support the development and preservation of thousands of units of affordable housing in New York City.
“The Federal Home Loan Bank of New York is delighted to provide $140 million in lower-cost dollars to HDC and New York City,” said Alfred DelliBovi, President of the FHLB-NY. “The purchase of the bonds will help enable HDC to continue its mission of creating and preserving multi-family affordable housing throughout the five boroughs of New York City during this time of financial distress for so many.”
HDC asked the FHLB-NY to purchase the $140 million in HDC Housing Revenue Bonds Series J and K to strengthen its commitment to New York City Mayor Michael R. Bloomberg’s $7.5 billion plan to develop and preserve 165,000 units of affordable housing in all five boroughs.
The FHLB-NY purchase allows approximately $35 million of the Series J taxable bonds and $40 million in Series K bonds proceeds to refinance outstanding bonds that were originally issued by HDC and supported by a liquidity facility from Dexia Credit Local.
These bonds are primarily used to fund the Mitchell-Lama Restructuring Program (MLRP) and new construction of projects for moderate income New Yorkers under HDC’s New Housing Opportunity Program. The proceeds of the remaining $65 million in 2008 Series K Bonds purchased by FHLB will replenish HDC reserves used to fund both senior and subordinate loans, and can now be re-lent at a rate of one percent to new developments.
HDC Acting Chairman Marc Jahr said: “I am delighted to have the Federal Home Loan Bank at our side in this tough credit market. The proceeds from the sale will refinance, preserve and provide construction loan financing for a total of 1,019 units of affordable housing in the Bronx, Manhattan and Brooklyn. In addition, a portion of the bonds will be used to replenish HDC’s unrestricted corporate reserves; which can then be re-lent to support new developments that are part of Mayor Bloomberg’s New Housing Marketplace Plan.”
