$27.8 million transaction with the Housing Authority of Baltimore City and the City of Baltimore includes the development of 93 new affordable rental homes and is part of the neighborhood redevelopment plan for Baltimore’s Perkins-Somerset-Oldtown community
The U.S. Department of Housing and Urban Development’s Office of Multifamily Housing on June 30, 2022 closed a Rental Assistance Demonstration (RAD) transaction with the Housing Authority of Baltimore City (HABC) and the City of Baltimore to create 93 units of newly constructed affordable rental housing at HABC’s Perkins I property. This transaction is the first of four planned RAD transactions for the Perkins Homes property.
Through this RAD conversion, the original and now obsolete public housing units at Perkins Homes, constructed in 1942, will be replaced with two townhomes and a four-story multifamily building that will include a courtyard, underground parking, and 7,400 square feet of commercial space on the first floor. Of the 93 affordable housing units to be constructed in this phase of the project, 48 will be replacement public housing units, and 45 will be Low Income Housing Tax Credit (LIHTC) units that subsidize affordable rental housing for low-income tenants. An additional 10 units will be market-rate housing. As part of the development design plan, 14 of the units will be accessible units for persons with mobility disabilities and another four units will be equipped for persons with vision/hearing impairments. The buildings will be Energy Star-certified and have Energy Star-rated appliances and water conservation fixtures.
In total, the RAD transaction construction budget for this project is $27.8 million ($270,000 per unit) and is fully financed through:
- Commercial First Mortgage Loan
- 4% Low-Income Housing Tax Credit Equity
- HUD Choice Neighborhoods Implementation Grant
- State of Maryland and City of Baltimore Grants
This transaction is part of the fourth phase of HABC’s and the City of Baltimore’s ten-phase Perkins-Somerset-Oldtown (PSO) Transformation Plan for revitalizing the Perkins Somerset Oldtown neighborhood, which is located near Downtown Baltimore and the city’s waterfront.
The overall neighborhood transformation effort includes the creation of a new school, the development of two new parks and updates to several existing parks and recreational and community facilities, a new community health clinic, as well as other infrastructure improvements. Additionally, the plan includes several other economic development initiatives, public safety strategies, and a comprehensive human services plan to assist in improving the lives of the community’s residents. The total redevelopment effort, when completed, will replace 629 units of existing public housing with 1,346 new mixed-income homes. Phase one, comprised of 104 units, was completed in 2021. Phases two and three are under construction and will result in a total of 264 units. For more information about the plan and progress to-date, please visit: PSO Transformation (habc.org).
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 April 1, 2022, the Rental Assistance Demonstration has facilitated more than $14.4 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.
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.