Fairstead Lands $120M in Financing for NoVA Affordable Housing Project

A historic housing community in Northern Virginia is getting a complete overhaul due to a new nine-figure financing package aimed at demolishing and re-imagining the complex.

Affordable housing developer Fairstead has tapped a variety of sources to secure a $120 million loan package toward its redevelopment of Samuel Madden Homes, a 1945-built community in Old Town Alexandria, Commercial Observer can first report. The community was constructed at the time by the Alexandria Redevelopment and Housing Authority (ARHA) and the federal government to house Black defense workers during World War II. 

Eighty years later, Fairstead is partnering with ARHA and The Communities Group to transform the property from 66 garden-style homes into a six-story, 207-unit affordable residential block at 999 North Henry Street. Demolition is slated to begin this month, with construction beginning in June. The project is expected to open in late 2027.

Fairstead acquired the funds from multiple fronts, including lenders and tax credits. That includes $62 million in construction financing from quasi-state government agency Virginia Housing;  $48 million in Freddie Mac equity syndicated by Boston Financial; a $3 million soft loan from the City of Alexandria; an undisclosed bridge loan Sterling Bank; 4 percent and 9 percent Low-Income Housing Tax Credits, as well as 45L Energy Efficiency Tax Credits.

“This project is a game-changer, not only for us as a firm but also for the City of Alexandria,” Noah Hale, Fairstead’s managing director, development, said in a statement. “Thanks to the incredible support from our partners, local leaders and the people of Alexandria, we’re transforming this site into a nexus of high-quality housing and essential community services. Our roots in Virginia run deep, and we remain committed to creating a lasting impact and uplifting the lives of local residents.”

The new building will be made available to four separate average median income levels (AMI). Seventy-seven units are earmarked for households earning 30 percent AMI, 27 units set aside for households earning 50 percent AMI, 52 for households earning 60 percent AMI and 51 for households earning 80 percent AMI. All of the families occupying the original 66 units will also be welcomed back into the new community once built, per Fairstead. 

Alongside the units, the property will feature 7,500 square feet of open space and about 500 square feet of ground-floor community space. The community space will serve as a food hub operated by food assistance nonprofit Alive! 

The developers behind the project also appear to be going out of their way to preserve the historical legacy of the site, with a goal of capturing at least 10 oral histories of current and past residents at Samuel Madden Homes. Archaeological sites will be opened and studied to understand the breadth of the property’s physical history, per Fairstead, and a documentary study is underway that the City of Alexandria will archive. Findings from that study will be produced in brochures and signage throughout the new project. 

“We’re incredibly proud to see this vision become reality and bring tangible relief to some of our most rent-burdened residents,” Alexandria Mayor Alyia Gaskins said in a statement. 

The redevelopment of Samuel Madden Homes extends the high-dollar housing activity happening in Alexandria lately. The city has become a hotbed of investment and development in recent years — take DSF Group’s $237 million purchase in February of the 678-unit Town Square at Mark Center, for which M&T Realty provided $165.9 million in acquisition financing. 

Red Fox Development, meanwhile, is planning to build the tallest tower in the city via its 31-story project at 2425 Mill Road, about 2.5 miles southwest of Samuel Madden Homes. Red Fox in March filed its plans with the city, which include 775 apartments and 40,000 square feet of commercial space. 

Nick Trombola can be reached at ntrombola@commercialobsever.com.