Helaba Bank is providing $83 million of financing for Edison Properties’ development of 188 Ludlow Street, a residential and retail property under construction in Lower Manhattan. The financing was arranged under the New York State Housing Finance Agency‘s 80/20 program and consists of an $83 million letter of credit for the tax-exempt bonds issued by the agency. It also includes a forward commitment on permanent financing, said Richard Bassuk, president of The Singer-Bassuk Organization, which arranged the financing.
Typically, a commercial bank provides the letter of credit for the construction portion of these projects and then Fannie Mae or Freddie Mac becomes the long-term lender. Although all parties declined to discuss terms, they agreed that it was very competitive.
Rick Lavrich, managing director, said the bank pursued the deal as part of a larger initiative to target this area. The letter of credit on 188 Ludlow Street is the first financing arranged under the program and Helaba has another loan set to close on May 18th.
The development will include 243 apartments units, 20% of which will be set aside for low-income residents, and 6,000 square feet of retail space. Another 5% of the units will be earmarked for moderate income tenants. Stephen Nislick, ceo of Edison Properties, said the company selected Helaba because new program will allow it to avoid a second bond issuance and save time and money in the re-underwriting.