July 6, 2022

HUD: $26 Million Rental Assistance Demonstration Conversion Closed with Philadelphia Housing Authority to Create 58 Newly Constructed Affordable Homes

New affordable rental homes are part of redevelopment plan for Philadelphia’s Sharswood/Blumberg community

The U.S. Department of Housing and Urban Development’s Office of Multifamily Housing today announced that it has closed a Rental Assistance Demonstration (RAD) transaction with the Philadelphia Housing Authority (PHA) to build 58 newly constructed affordable rental homes in the Sharswood/Blumberg community. These homes will be built on both vacant lots and locations with blighted structures.

The RAD transaction includes a construction budget of $26.1 million ($450,000 per home) fully financed through several sources:

This RAD transaction supports revitalizing a neighborhood that has experienced housing abandonment, with over 1,300 vacant parcels. To date, the PHA has preserved 1,900 public housing units through RAD, enabling the investment of $467 million in funding for renovations and construction activities. Across the PHA’s 29 closed transactions, 18 are new construction and 16 utilize a transfer of assistance.

Sharswood Phase 4A is the third transaction of the PHA’s Blumberg/Sharswood Choice Neighborhood Implementation (CNI) grant award. The transaction will create occupied, affordable rental homes, enabling the redevelopment of existing blighted properties and the construction of new parks, schools, and meaningful and empowering social services for residents including improving education, health, and job preparedness through new and continuing programs.

Sharswood Phase 4A includes the construction of 6 accessible homes and 3 additional homes built for those who are hearing or visually impaired. Construction will include sustainable design elements guided by two green rating programs, Enterprise Green Communities and Energy Star Certified Homes, and will achieve a reduced Home Energy Rating System (HERS) rating. Each home will also include hardwired broadband capabilities. Finally, construction will include a standalone community center, equipped with a kitchenette and outdoor space as well as a property management office and dedicated office space for a social service coordinator.

About RAD

RAD was designed to help address the multi-billion-dollar nationwide backlog of deferred maintenance in the public housing portfolio and to stem the loss of affordable housing that could no longer be kept to decent standards. From the program’s inception through June 1, 2022, the Rental Assistance Demonstration has facilitated more than $14.5 billion in capital investment to improve or replace nearly 175,000 deeply rent-assisted homes, most of which house extremely low-income families, seniors, and persons with disabilities.

Under RAD, projects funded under the public housing program convert their public housing assistance to project-based Section 8 rental assistance. Under Section 8, residents continue to pay 30% of their income towards rent and the housing must continue to serve those with very low and extremely low incomes, as was the case when the property was assisted through the public housing program. Residents must be notified and consulted prior to conversion, are given a right to return to assisted housing post-construction so that the same tenants can enjoy these newly preserved and improved apartments and maintain the same fundamental rights they had as public housing residents.

RAD Resources

More programmatic information is available at the RAD website. Data on RAD is available at the RAD Resource Desk.

View photo essays and read case studies where RAD is working to successfully preserve and improve public housing for low-income families.

Watch an educational video for public housing residents or those new to the RAD program.

This post was originally published here.