STFFP sought to renovate three affordable housing buildings to comply with New York City building performance standards and maintain the availability of low-income housing in the area. As a non-profit provider of critical social services,, STFFP’s ability to access a no-cost, zero- interest predevelopment loan removed capital access and cost barriers that can otherwise limit project development, particularly where green measures may otherwise be value-engineered out of design plans to limit upfront costs. . The predevelopment work included an integrated physical needs assessment, architectural services, and engineering services to evaluate and design deep efficiency upgrades for their buildings.
To overcome the gap in financing during the design phase, STFFP engaged NYCEEC for a green predevelopment loan. By partnering with NYSERDA, NYCEEC was able to offer a $90,000 zero-interest loan for predevelopment design work. In addition to the loan, NYCEEC provided a technical review and evaluation of predevelopment plans, project budget, and feasibility to ensure the projected carbon reductions would be realized and meet their underwriting guidelines.
The predevelopment assessment identified LED lighting upgrades, energy-efficient window installations, heat pumps for water heating, low-flow fixtures, and weatherproofing upgrades at the three proposed sites. The upgrades are expected to reduce energy usage by 35% annually and allow one building to become fully electric. Once the predevelopment assessment was completed, the final designs were approved and STFFP successfully obtained over $18 million of construction financing for the remainder of the project.
NYCEEC offered STFFP $90,000 in a pre-development loan; at the time of closing for the predevelopment loan the estimated construction costs were $18 million. The $90,000 zero-interest loan was paid back over 2.5 years (1.5 year draw period and 1-year repayment period if necessary).
The following technologies were implemented through the project:
- LED lighting upgrades
- Central heat pump water heaters
- Low-flow fixtures
- Energy efficient window installations
- VRF drives for electrification
In collaboration with the New York State Energy Research and Development Authority (NYSERDA) and New York City Housing Preservation and Development (HPD), NYCEEC administers the green predevelopment loan program. Through NYSERDA’s support, NYCEEC is able to offer zero-to-little interest predevelopment loans to borrowers participating in several HPD programs. The NYCEEC green predevelopment loan is akin to a bridge loan so a borrower can remain active in HPD’s pipeline and complete necessary engineering and design work prior to HPD construction finance closing.
As a result of the renovations, St. Francis Friends of the Poor achieved preservation of 255 single-room occupancy units for low-income individuals in the city. The three renovated buildings, including on fully electric building, will reduce energy consumption by 35% annually, with an aggregate energy savings of 3,900,000 kBtu/yr.
