(by Colleen M. Sullivan, Banker & Tradesman Staff Writer)
The former Norstin Apartments near Central Square in Cambridge will be preserved as affordable housing through an $8 million deal between the Community Economic Development Assistance Corporation (CEDAC), the city of Cambridge, and Cambridge-based housing non-profit Just A Start Corp.
The 4-story property lies between Bishop Allen Drive and Norfolk Street in Cambridge, has 32 two- and three-bedroom units, and will be renamed the Bishop Allen Apartments in the wake of the purchase. The city was particularly anxious to preserve it since demand for affordable housing with multi-bedroom units considerably outstrips supply, sources familiar with the project told Banker and Tradesman.
"[Cambridge] is really committed to making sure their affordable housing is preserved over the long-term," Roger Herzog, CEDAC's executive director, told Banker and Tradesman.
CEDAC provided a loan in the amount of $4.3 million. The Cambridge Affordable Housing Trust provided approximately $4,000,000. The city of Cambridge added additional funds to cover carrying costs and predevelopment expenses.
The apartments are the second expiring-use project to be preserved in Cambridge. Earlier this year, the city and CEDAC, along with Homeowner's Rehab Inc. were also involved in a deal to preserve the Chapman Arms in Harvard Square.
Both deals demonstrate the impact of the 40T statute passed by the state in 2009, Herzog argues. The law gives the Department of Housing and Community Development (DHCD) the right of first refusal when a project that had been affordable housing is eligible to be sold or converted to market rate. The Chapman Arms project was the first where DHCD exercised that right.
"It's two ways that 40T is working. In Chapman [Arms], we saw it work under the provision that allows DHCD to exercise a right of first refusal. In Norsten, we see an alternative approach," said Herzog. The owners of the Bishop Allen buildings, aware that the city of Cambridge wanted to preserve the property as affordable housing, sought out the non-profit Just A Start himself and pitched the project to them.
Since putting it in Just A Start's hands would preserve affordability, he was able to obtain an exemption from review of the sale by DHCD, Herzog said. "Either way, the project is preserved as affordable housing," he added. "40T is making an impact."