Insurance endorsement provided by FHA preserves 272 affordable rental homes at Barbara Jean Wright Court Apartments
The Federal Housing Administration (FHA) announced today that it has recently closed on a $46.9 million loan insured under FHA’s 221(d)(4) Substantial Rehabilitation Insurance program for Barbara Jean Wright Court Apartments in Chicago, Illinois. Through FHA-insured affordable mortgage financing and HUD-assisted Section 8 project-based rental assistance, 272 affordable homes will be rehabilitated and preserved for low-income individuals and families.
The total development cost for the rehabilitation is $86.2 million. Sources of financing include:
- $46.9 million FHA-insured mortgage, which included a reduction in upfront and annual mortgage insurance premiums through FHA’s Multifamily Broadly Affordable Mortgage Insurance premium reduction;
- $25.6 million of 4% Low-Income Housing Tax Credit equity;
- $8.8 million in secondary financing from the City of Chicago;
- $2.2 million seller loan;
- $1.6 million in Interim Income; and
- $1 million Deferred Developer Fee.
When rehabilitation is complete, the property will include 272 fully renovated multifamily apartment homes with rental subsidy. 108 of these homes will have a Section 8 Housing Assistance Payment Contract. The remaining 168 homes have the choice to receive a Housing Choice Voucher or to receive rental assistance at the property under a project-based voucher contract.
The property is adjacent to the University of Illinois Chicago Campus and the University of Illinois Medical Center District in the “Little Italy” neighborhood and has numerous employment opportunities, convenient access to public transit, shopping, and grocery stores.
The rehabilitation will take 22 months to complete and includes entire interior overhauls, and energy efficient exteriors including windows, new roof, siding, energy star HVAC units, and electrical panel upgrades. The site will be improved with key card entry gates, security cameras, parking lot repairs, upgraded site lighting, new landscaping, bike racks, and sod. New amenities include the construction of a 6,000 square foot community building that includes a community kitchen, classrooms, on-site management offices, conference space, fitness center, community room, and a computer access room.
About the Office of Multifamily Housing
FHA’s Office of Multifamily Housing Programs plays an important role in the construction, substantial rehabilitation and refinance of market rate and affordable housing through the issuance of FHA mortgage insurance. These insurance programs provide stability, liquidity, and affordability to the multifamily housing market by providing credit during countercyclical times and in small markets.
In fiscal year 2021, the Office of Multifamily Housing Programs achieved record-breaking volume of $29.5 billion in initial endorsements for mortgage insurance. View quarterly and historical data on FHA Multifamily volume here.