MassHousing Provides $9.3M Loan to Renovate Affordable Community in Massachusetts

GARDNER, Mass. — MassHousing has provided $9.3 million in financing to Retirement Housing Foundation for the preservation and renovation of Binnall House in Gardner, located approximately 60 miles west of Boston.

The financing will update the eight-story seniors housing community’s 134 units and maintain the affordability for at least 15 years.

MassHousing refinanced Binnall House’s debt through the lender’s Multifamily Accelerated Processing (MAP)/Ginnie Mae Joint Venture Initiative with lender partner Rockport Mortgage Corp. The Schochet Companies provided development consulting and its affiliate, Federal Management Co., is the property manager for Binnall House.

The financing is structured so the borrower can deploy approximately $6 million in low-income housing tax credit equity toward renovations at the property. The combination of tax credits, with a mortgage insured by the FHA and guaranteed by Ginnie Mae, will allow Retirement Housing Foundation to make more substantial renovations to Binnall House than would have been possible through MAP financing alone.

As a condition of the MassHousing financing, the borrower plans to renew the federal Section 8 Housing Assistance Payment Contract on 133 apartments at Binnall House for 20 years and include the remaining term of the current HAP contract, which expires in 2023. A property manager occupies one apartment.

MassHousing allowed the borrower to pre-pay its existing mortgage on Binnall House, with a 5.04 percent interest rate, and refinance the property with a $9.3 million taxable first mortgage loan with a 3.05 percent interest rate. MassHousing also provided a tax-exempt construction loan to trigger the use of the tax credits.

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