Urban developers Donald Capoccia, Joseph Ferrara, Brandon Baron, Francine Kellman and Brian Raddock embark on a joint multifamily venture
New York, February 3, 2011 – Experienced urban developers Francine Kellman and her co-principal Brian Raddock, formerly of the New York Office of Vitus Group; and BFC Partners, a New York-based builder owned and operated by Donald Capoccia, Joseph Ferrara and Brandon Baron, together have formed a new private, affordable housing development firm, Preservation Development Partners, it was announced today.
The joint venture will seek to acquire and preserve existing multifamily housing stock in urban markets throughout the U.S., with a commitment to keep rents affordable for working families in the low- and middle-income range.
Ms. Kellman said, “We will take an active role in acquiring apartment properties that are at risk of deterioration, abandonment or financial default by speculative buyers. We will also target properties whose present owners cannot afford to maintain them, or who simply want to divest them.”
Mr. Capoccia said, “We are excited to inaugurate this partnership with Francine Kellman and Brian Raddock. Our mission will be to preserve affordable housing in the urban center, where gentrification can lead to the displacement of hard working, lower income families. Ill-timed and misguided investment can also lead to abandoned or poorly maintained buildings. Having the peace of mind that your home will remain affordable brings a sense of stability to entire neighborhoods.”
Both Mr. Capoccia and Ms. Kellman have several decades of experience in the housing industry and have records of success in developing affordable housing, often in partnership with community development groups and government housing agencies. Mr. Raddock has partnered with Ms. Kellman on several recent property acquisitions, and as a professional real estate analyst prior to joining Ms. Kellman, has structured and raised capital for the Centerline Capital Group.
Ms. Kellman gained 14 years of hands-on experience at the U.S. Department of Housing and Urban Development, followed by nine years at the New York State Housing Finance Agency. At HFA, she created and launched the agency’s first housing preservation program, refinancing and renovating more than 5,000 units of low-income housing.
At BFC Partners, Mr. Capoccia, with Messrs. Baron and Ferrara, directs the firm’s focus on constructing affordable housing in emerging neighborhoods. Under Mr. Capoccia’s guidance, BFC Partners was one of the first developers in New York City to mix low- and middle-income restricted apartments with marketplace rentals. The company was named “Private Developer of the Year” in 2009 by the National Housing Conference and the New York Housing Conference.
In the recent past, the principals of Preservation Development Partners have closed development financing transactions with the New York City Housing Development Corporation (HDC) through HDC bonds, and with the New York City Department of Housing Preservation and Development (HPD). As a result, they have added significant numbers of units to Mayor Bloomberg’s New Housing Marketplace Plan.
Preservation Development Partners’ business plan envisions immediate and fast-tracked building rehabilitation schedules for their acquired properties. Whenever possible, existing tenants will not be relocated during construction. Typically, the properties acquired by Preservation Development Partners will be upgraded with new elevators, roofs, windows, boilers, heavy duty re-wiring, trash compactors, flooring and matching new facades.
In Ms. Kellman’s and Mr. Raddock’s most recently completed project — the rescue and rehabilitation of Lexington Courts, a nine-building, 229-unit apartment complex in East Harlem — all of the apartments benefit from a federal Section 8 affordable housing contract stipulating that rents cannot exceed 30% of tenants’ household income.
Mr. Raddock said, “Prior to the acquisition, because of its poor condition, the property had failed a pivotal inspection by the U.S. Department of Housing and Urban Development, which would have jeopardized the tenant rent subsidy. It is likely that many, if not most, of the families at Lexington Courts would have faced a serious housing crisis unless the buildings were brought back to federal standards of maintenance.”
In addition, Ms. Kellman and Mr. Raddock recently completed the acquisition of Morris Heights Mews, a 110-unit multifamily apartment complex in the Bronx. The dilapidated property was rescued though innovative acquisition and construction financing provided by the New York City Housing Development Corporation (HDC) — through HDC bonds.
BFC Partners continues to pursue projects, such as the Toren luxury high-rise apartment building in Brooklyn, that generate new housing for local residents and new arrivals, significant financial rewards for investors and economic prosperity for communities.