The AFL-CIO Housing Investment Trust (HIT) is providing $89 million of pension capital to repair Hurricane Sandy damages at Amalgamated Warbasse Houses, one of New York's largest union-sponsored housing cooperatives.
Located in Brooklyn's Brighton-Coney Island community, the development was built in the 1960s as affordable housing for union families, with the backing of the Amalgamated Clothing Workers, forerunner of today's UNITE HERE.
Located on 26 acres, the Mitchell-Lama cooperative consists of 2,585 residential units and 17 ground-floor professional units as well as a small retail center.
The new loan allows the property to replace the electrical distribution system that was destroyed by flooding as well as refinance existing debt at significant cost savings that will help keep the cooperative affordable to residents, according to the HIT.
"This investment provides vital funds for Brooklynites to rebuild after Sandy's wrath," New York City Comptroller John Liu said in a statement. "New York's hardworking and retired municipal employees are committed to putting their retirement savings into investments that not only offer positive returns but also benefit the communities they call home."
Five New York City public employee pension plans are HIT investors.
The most serious hurricane damage inflicted on Amalgamated Warbasse in October 2012 was the loss of the co-op's electrical transformers due to saltwater flooding. Residents of the co-op's five 24-story buildings experienced devastating hardships in the storm's aftermath, without lights, heat, refrigeration, elevator service, and other necessities until temporary generators could be installed.
Flooding also damaged the co-op's income-producing retail space, and there was considerable wind damage. The HIT bridge loan enables the co-op to move ahead with repairs while waiting for the anticipated insurance proceeds. To guard against future power losses, the loan will pay for relocating the transformers above the flood plain. The HIT-financed work is expected to create about 225 union construction jobs.
The New York City Housing Development Corp. and New York State Division of Housing and Community Renewal worked with the HIT to help expedite the loan.