Transaction supports significant renovation of rental homes at multifamily property with a HUD project-based rental assistance contract.
The U.S. Department of Housing and Urban Development’s Office of Multifamily Housing announced today that it recently closed a Rental Assistance Demonstration (RAD) transaction with Bridge Housing, a non-profit housing provider, to support the preservation and renovation of 40 affordable rental homes for seniors at Chestnut Creek Apartments in San Francisco, CA. The property participates in HUD’s Section 202 Housing for the Elderly program and has a HUD project-based rental assistance contract.
Chestnut Creek Apartments is located in South San Francisco, CA, a suburb directly south of the City of San Francisco. The property was built in 2003 and was originally developed as an affordable housing community to serve low-income seniors and low-income adults with disabilities. As the property ages, the owner, Bridge Housing, is leveraging RAD to finance updates and repairs. Significant repairs will be performed, including window, sliding glass door, and french door replacement on all four building exterior facings. Plywood balcony decks will be replaced with new waterproof pedestrian deck coating, the roof, parking lot, and water systems will undergo repairs, and refrigerators and electric ranges will be replaced in all resident homes. Through the RAD conversion, Chestnut Creek will transition to a 20-year RAD Section 8 Housing Assistance Program contract, ensuring the long-term preservation of these homes for current and future residents.
Twenty years of capital improvement needs at the property will be addressed through the RAD transaction, which includes a $7.2 million construction budget ($180,000 per home) fully financed through a Federal Housing Administration (FHA) refinancing of the property’s mortgage into a new FHA 221(d)4 loan.
About RAD for Multifamily
The Rental Assistance Demonstration (RAD) allows proven financing tools to be applied to at-risk public and assisted housing and has two components: RAD for Public Housing and RAD for Multifamily. RAD for Multifamily (or RAD 2nd Component) was created to give owners of HUD’s programs the opportunity to enter long-term contracts that facilitate the financing of much needed improvements or new construction. These programs include Section 8 Moderate Rehabilitation and Moderate Rehab Single Room Occupancy (SRO) funded by McKinney-Vento, and Project Rental Assistance Contracts (PRACs) under the Section 202 Supportive Housing for the Elderly program. RAD for Multifamily also allows the conversion of newly awarded Capital Advance PRACs to a long-term contract as applicable.
Owners may choose between two forms of Section 8 Housing Assistance Payment (HAP) contracts: project-based vouchers (PBVs) or project-based rental assistance (PBRA), both with initial 20 year-terms. For more information on RAD statutes and the current Notice revision, visit RAD’s Statutes, Notices, Regulations & Tools , or contact RAD2@hud.gov with questions.
RAD for Multifamily Resources: