Grove House and Park Terrace Apartments in East Orange, New Jersey sold for $7.25 million. Essex County Improvement Authority Issues $8,855,000 Project Revenue Bonds to finance acquisition, renovation, and equipping of the properties.
PTGH-EO Urban Renewal LLC purchased the two apartment buildings in East Orange, New Jersey. The 4-story buildings were originally constructed in 1925 and were renovated in 1975.
Park Terrace is located at 321 Park Avenue and contains a total of approximately 35,033 square feet of net rentable area in 39 units divided as 6 one bedroom units, 17 two bedroom units, 14 three bedroom units, and 2 four bedroom units. 38 units are Section 8 Units with the tenant-paid portion of unit rent limited to 30% of the tenant’s adjusted gross income.
Grove House is located at 254 North Grove Street and contains a total of approximately 22,747 square feet of net rentable area in 33 units divided as 16 one bedroom units, 11 two bedroom units, 6 three bedroom units. 32 units are Section 8 Units with the tenant-paid portion of unit rent limited to 30% of the tenant’s adjusted gross income.
THE PURCHASER & TEAM PTGH-EO Urban Renewal LLC, a Delaware limited liability company, is a newly created single asset entity, of which Linked Economic Development & Affordable Housing Foundation Inc. (“LEDAHF”), a Virginia 501(c)3 designated non-profit organization, is the sole member.
LEDAHF’s mission is to:
1.Promote the availability of affordable housing and to sponsor, acquire, develop, own,manage, and operate affordable rental housing for families, seniors, and disabled individuals;
2.Promote local economic development; and
3.To otherwise relieve the burdens of government. LEDAHF has helped local governmentfinance and construct new county buildings, public schools, parks, senior centers, animalshelters, and other needed community facilities. LEDAHF can frequently deliver these facilitiesmore efficiently, more quickly, and at lower cost.
The project is currently managed by the Housing Authority of the City of East Orange.
BOND FINANCING The acquisition and improvements to the property were financed utilizing rated tax-exempt multifamily housing revenue bonds. The Essex County Improvement Authority acted as issuer on the bonds. Standard & Poor's Ratings Services assigned an “BBB+“ rating to the senior bonds totaling $8,075,000. Subordinate bonds in the amount of $780,000 received a “BB+” rating. The total amount of Multifamily Housing Revenue Bonds Issued by the Authority was $8,855,000.
The Bonds were purchased by the underwriters, Raymond James & Associates, Inc. and CFG Capital Markets, LLC.
Per LEDAHF’s mission and certain conditions in the financing, the owner will be obligated to lease at least 75% of the dwelling units in the property to Low and Moderate Income tenants.