Redstone Bank, Goldman Sachs, New York State Provide $217M for Alafia Project

A new affordable housing complex in one of Brooklyn’s poorest neighborhoods just took another step closer to completion thanks to a combination of private dollars and public financial support. 

Apex Building Group and L+M Development Partners have secured $217 million in construction financing for the third phase of the Alafia Project, a two-building residential development that will deliver 273 units of affordable housing and new public green space to East New York, Brooklyn, Commercial Observer can first report. 

Redstone Bank, working with Goldman Sachs Urban Investment Group, and the New York State Energy Research and Development Authority provided an undisclosed amount of construction debt. 

New York State Homes and Community Renewal — the state’s umbrella affordable housing agency and housing finance entity —  is expected to provide $97 million in equity through the federal Low-Income Housing Tax Credit program, while the state’s Low-Income Housing Tax Credit is expected to deliver $14 million in equity and an additional $57 million in tax-exempt bonds for the project’s remaining equity. 

“The $217 million investment includes modern and sustainable apartments, as well as recreational and green space that promote togetherness,” said RuthAnne Visnauskas, commissioner of New York State Homes and Community Renewal. 

The greater Alafia redevelopment project will eventually transform 27 acres of the old Brooklyn Developmental Center, a former state institution for individuals with intellectual disabilities, into a mix of new affordable housing, community centers and mixed-use retail developments for residents of East New York. The neighborhood’s poverty rate hit nearly 22 percent in 2024, compared to 18 percent citywide, according to New York University.

“As this next phase moves forward, hundreds of additional affordable homes, thoughtfully designed public spaces and sustainable infrastructure will help strengthen East New York,” said Hope Knight, commissioner, president and CEO of Empire State Development. 

The final, overall development is anticipated to deliver several apartment buildings and 2,600 units of affordable housing, a new 50,000-square-foot community medical facility and senior health center with ground-floor retail, and more than 20,000 square feet of public green space. 

“This project wouldn’t be possible without the support of our partners,” said Jessica Yoon, managing director at L+M Development. “We are excited to move into the next phase with them, which will bring more affordable housing and significant public space to the community.” 

Phase 3 is expected to be completed in 2029.

Brian Pascus can be reached at bpascus@commercialobserver.com.