Located on the Lower East Side of Manhattan, Essex Crossing – Site 6 is part of a $1.2 billion multi-stage mixed-use development that consists of nine sites on six acres that were mostly vacant since 1967. This effort represented one of the most significant revitalization developments in the history of New York City. Phase One of the project includes the development of Site 6, a 14-story, 177,448-square-foot mixed-use development that used both NMTCs and LIHTC funding as parts of its capital stack.
This project is an example of how the LIHTC and NMTC can be used side by side on different portions of a large-scale project to meet a variety of community development goals. The financing for this project was partitioned into three separate parts an NMTC-financed portion totaling $42 million, a Low Income Housing Tax Credit (LIHTC) financed portion, and another portion used to finance a 3rd-floor commercial condo. The project includes four floors of the building occupied by: a 51,000 square-foot medical facility/office space (leased by New York University); a 22,000 square-foot community center run by the non-profit Grand Street Settlement; a 4,000 square-foot outdoor garden/open space; and 6,000 square feet of retail. An additional educational facility – not financed with NMTC equity – is located on the third floor. The upper ten floors of Essex Crossing Site 6 also include 100 units of affordable housing for seniors financed through LIHTC, which benefits from easy access to the adjacent medical and social service tenants within the project as described above.
The project came to the attention of Wells Fargo through its LIHTC group, which provided both debt and equity for the LIHTC component of Site 6. Wells Fargo’s NMTC team provided allocation to the transaction in addition to acting as NMTC investor for the project, ultimately providing $34.5 million in NMTC investment capital to Wells Fargo Community Development Enterprises and its co-allocatees Low Income Investment Fund and ESIC New Markets Partners, LP.
As of December 2016, project construction was underway and was projected to create 300 construction and 200 permanent jobs once it was operational. Two additional project phases are expected to be completed by 2024.
“It’s clearly fantastic to have an institution like NYU involved, and from just a general standpoint, we saw a hole in this market where we really felt the community needed doctors’ offices and services that NYU can provide,” S. Andrew Katz, a partner on the project’s development team told the Commercial Observer. “When you talk about responsible development and doing great things, this is sort of a dream come true, [being] able to do senior housing and medical.”