Innovative program created by Fordham helps maintain housing in the Bronx Early last year, two small apartment buildings in an economically depressed section of the northwest Bronx weren't exactly falling down, but there was no money for such things as a badly needed new boiler and roof repairs, much less the renovation of vacant apartments.
Worse, no lender could be found to finance the work at anything other than an exorbitant interest rate.
In desperation, John Reilly, the executive director of the building's owner, the Fordham Bedford Housing Corp., turned to the University Neighborhood Housing Program, the community development arm of Fordham University. The $698,000 in loans that Mr. Reilly's organization received is part of a new $25 million effort designed to provide long-term, fixed-rate mini-loans for the maintenance of five- to 25-unit buildings.
Fordham's pull Since that time, not only has the work at the two buildings been completed, but Mr. Reilly has applied for mini-loans for four more buildings.
The miniloan program is the latest UNHP financing effort in the northwest Bronx. The group was set up at the suggestion of the Northwest Bronx Community and Clergy Coalition, in the belief that Fordham's involvement would embolden banks to increase their participation in local development projects.
To date, the 17-year-old organization has made and/or packaged about $23 million in loans for more than 70 residential buildings bia a series of different programs. UNHP also offers technical assistance and acts as an information clearinghouse regarding loans and other community development resources.
The mini-loan program, so-called because credits range from $100,000 to $700,000 per building, is a classic example.
UNHP set it up in 1998 with the help of Fannie Mae, the federally chartered corporation that helps channel mortgage money to medium- and low-income families. The program calls for Fannie Mae to package loans made by participatng banks into mortgage-backed securities, which the New York City Employees' Retirement System will purchase as investments. That aspect of the program is still in development, however.
Lone Participant Right now, the plan offers funds for refinanceing and acquiring buildings as well as for renovations, with UNHP acting as intermediary between landlord and lender. To date, the only participating lender has been Manhattan-based Community Preservation Corp., although Chase Manhattan Bank and HSBC are looking into the program.
Jim Buckley, UNHP's executive director, says three buildings already have completed nearly $1 million worth of renovations throught the program. Eight other loans, totaling about $5 million, are "in the pipeline."
Northwest Bronx Community and Clergy Coalition executive directory Mary Daley says the mini-loan program answers the area's financing needs. "If only we had more loan programs like this," she says.