Grace Apartments is a 101 unit, 99% Section 8 senior apartment property located in downtown Providence. Its prime location just off I-95 and on the edge of the city’s booming "Downcity" district made it a potential market-rate conversion candidate, but a faith-based seller selected POAH to purchase the property based on its strong preservation track record.
Grace was POAH ’s first project using the HUD Section 221 (d)(4) program, which provides both the construction and the permanent financing in a single loan. Structuring the transaction in this way eliminated the risk of a change in interest rate, and streamlined the underwriting criteria. The property also benefits from a partial real estate tax abatement from the City of Providence under Rhode Island’s Chapter 44-5 statute, which is critical since it mitigates what would otherwise be a significant operational risk.
POAH ensured continued affordability by working with HUD to renew the Section 8 rental subsidy contract, and made over $3.5 million in capital improvements to the building complex. The rehabilitation included full window replacement, corridor ventilation, modernized kitchens and baths, common-area improvements, and life-safety upgrades – including the installation of fire sprinklers in all apartments.
POAH also entered into an agreement with a nonprofit commercial tenant, The Cookie Place, which provides food-service job training to veterans and developmentally disabled adults. The Cookie Place’s former lease had expired and its future was uncertain. A new lease and upgraded space will enable the organization to continue its important work, ensuring that the smell of fresh-baked chocolate chip cookies will continue to grace the halls.
- Rhode Island Housing
- Red Capital Group
- Boston Private Bank & Trust Company
- US Department of Housing and Urban Development (HUD)
- Massachusetts Housing Investment Corporation (MHIC)