Two of NYC’s Largest Pension Funds Plan $250M Affordable Housing Investment
Two of New York City’s largest pension funds have teamed with a developer to launch a $250 million fund to build affordable housing around the state.
The New York City Employees’ Retirement System and the Teachers’ Retirement System of the City of New York launched a partnership with the Hudson Companies to create new, mixed-income housing in New York City as well as Nassau, Suffolk, Westchester, Putnam, Orange and Rockland counties.
“Fighting climate change and increasing access to affordable green housing are crucial to making New York City an equitable place to live for generations to come,” Mayor Bill de Blasio said in a statement. “Our pension trustees are meeting the moment by divesting from fossil fuels and investing in climate solutions like this partnership: a winning combination for our planet, our city and our pensioners.”
At least 70 percent of the $250 million must be used to build new residential developments — either rents, co-ops, or condominiums — with the remainder able to be used to purchase or renovate existing properties.
As part of the deal, the rents and purchase prices of new apartments can’t exceed 200 percent of the locations’ area median income.
Hudson plans to target areas with plenty of public transportation options — to reduce the need for residents to rely on cars — and told Bloomberg that it has already identified sites in Brooklyn and Westchester County to potentially develop.
Officials touted the developments as sorely needed, because the city already faces a deep shortage of affordable housing units and the coronavirus pandemic created an even larger demand.
“Working families were the hardest hit economically by COVID-19,” Henry Garrido, executive director of the city’s largest municipal employees union, District Council 37, said in a statement. “Too many were left worrying about their jobs and how they’d pay their next rent check. This fund is a solution to those issues.”
The new effort isn’t the first time Hudson has partnered with the city’s pension funds to develop affordable housing. The developer led a $500 million fund for all of the city’s pension funds in 2013 that eventually developed The Lois and The Clark in Prospect Lefferts Gardens, Brooklyn.