New York, NY. RDC Development, in partnership with the New York City Housing Authority (NYCHA), has closed on financing to provide for the much-needed renovation of the Ocean Bay (Bayside) development in the Rockaways, a project for which Nixon Peabody LLP provided legal counsel. The renovations will significantly improve the living conditions of the development’s 3,700 residents and bring additional social services to the complex.
The significant financial resources needed to renovate the development were raised through a complex Rental Assistance Demonstration (RAD) transaction—the first in New York City—that included a combination of tax-exempt bonds, a Citibank loan, FEMA funds, low-income housing tax credit equity from multiple investors, and capital and land leases, among others.
The RAD program facilitated the transaction by converting the development’s public housing funding to a project-based rental assistance contract, which leveraged the public and private financing. RDC and NYCHA were able to undertake a complete rehabilitation of the development without increasing the rents and maintaining long-term affordability for the complex’s residents.
The renovations will reverse the structural and operational wear-and-tear the development has accrued since it was built in the 1960s and the severe damage it incurred during Hurricane Sandy in 2013. The renovations will be made to 1,395 public housing units across 24 buildings.
Deborah VanAmerongen, John Kelly, Meghan Altidor and Dana Roper of Nixon Peabody’s Affordable Housing practice group advised RDC Development—composed of MDG Design & Construction, Wavecrest Management Team, Catholic Charities of Brooklyn and Queens and Ocean Bay Community Development Corporation.
In addition to the four developer parties, Nixon Peabody coordinated multiple social service providers and more than 12 construction contracts with eight contractor entities, amounting to more than $560 million of financing for the owners.