1999 Opening of Kenmore Hall 326 Units of Affordable Housing in the heart of Manhattan

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1999 Opening of Kenmore Hall 326 Units of Affordable Housing
in the heart of Manhattan

April 29, 1999

Media contact:  

Claire Haaga, Housing and Services
(212) 683-1212
Sharon Beadle, Bell Atlantic
(212) 395-1802
Mark Taylor, MSB Stragegies
(212) 453-2804

(New York, NY) -- The official ribbon-cutting
ceremony will take place, Tuesday, May 4, 1999, for what can
aptly be described as The Miracle on 23rd Street: the once
infamous Kenmore SRO hotel is today a model of affordable housing.
The new Kenmore Hall now promises to be a community asset and
national model of affordable supportive living.

Consider the miracle: One evening in June of 1994, a team of U.S.
Marshals and New York City police officers made their way down dim
narrow hallways, searching the common bathrooms of the Kenmore Single
Room Occupancy Hotel for illegal drugs and firearms. The law
enforcement agents burst down doors of the Kenmore's 6'x10' rooms, in
search of drug dealers, prostitutes, bail jumpers, parole violators and the
likes. The next day, standing in front of the Kenmore, U.S. Attorney
General Janet Reno, New York State then-Governor Mario
Cuomo and New York City Mayor Rudolph Giuliani
announced that the collaborative seizure of the Kenmore Hotel had been a
success. The government's effort to take back the Kenmore represented
the largest asset forfeiture the United Stated had ever undertaken.

Fast-forward five years: On the same piece of sidewalk in front of the new
Kenmore Hall, a representative from the U.S. Department of Housing and
Urban Development joined the President and founder of Housing and
Services, Inc., Claire Haaga, along with former New York City
Deputy Mayor Fran Reiter; NYC Commissioner of Housing
Preservation and Development Richard Roberts; NYC
Commissioner of Homeless Services Martin Oesterreich and
other civic and community leaders to cut the ribbon on an affordable
housing complex many said would simply be impossible to create.

Housing and Services, Inc., ("HSI"), is the force behind this
miraculous transformation. HSI was selected by the New York City Office
of the Mayor and the federal government as the not-for-profit developer
and operator of the facility. A year after the takeover - in 1995 - the
federal government won in court legal title to the property. At the same
time, HSI was working to assemble the complicated financing package
that would be necessary to begin and complete renovation.

Claire Haaga, HSI President and founder, recalls: "We created a
complex bundle of financing for this project. In fact, the reconstruction of
the Kenmore represents one of the most ambitious affordable housing
ventures in the country. In total, we estimated that it would take over $30
million to pay off liens on the hotel, hire staff, reconstruct the building and
secure it financially for years to come. Bell Atlantic provided $14 million
in equity for the project which enjoys benefits from the Low Income
Housing Tax Credit Program. Chase Bank committed a loan. New York
City and New York State made $9 million in low interest loans. The U.S.
Department of Housing and Urban Development committed hundreds of
Section 8 vouchers to provide rent subsidies for the tenants. We brought
together an innovative and vital set of partners."

The HSI-assembled partnership purchased the Kenmore in July of 1996.
The building had never been upgraded since its construction in 1925.
However, with financial commitments in place, HSI staff began planning
for three phases of construction - to be completed with all
with tenants in place.

On July 3, 1996, HSI closed on the Kenmore. Construction crews began
working that same afternoon. Today, less than three years later, some 500
code violations have been remedied. The non-functional boiler has been
replaced. Efficient elevators have been installed. Most important: 326
new studios have been carved out of the maze of tiny rooms. All new
units are twice the size of former rooms. New units are fully furnished
and equipped with private bathrooms and kitchens, individual air
conditioners, in-room intercom systems and state-of-the-art fire alarm
systems. Finally, the renovation of the Kenmore has earned strong
community support. HSI spent 18 months prior to acquisition canvassing
community leaders, and HSI continues to work to address community
concerns, to develop community consensus, and to earn community
support. The new Kenmore Hall also features community rooms for
tenant activities, a library, exercise rooms and offices for the 30-person
social service and management staff that provides a host of services to the

Bell Atlantic has invested in low-income tax-credit programs such as the
Kenmore for the past 10 years. "We are proud of our role in the
redevelopment of the Kenmore," said Bell Atlantic Group President
New York and Connecticut, Paul Crotty. "Each year we
invest hundreds of millions of dollars in New York City to improve our
network and our communities. The Kenmore is a perfect example of Bell
Atlantic's investment in human capital, one with a high rate of return for
our neighborhoods, our customers and potential employees."

Fran Reiter, President and CEO of the New York Convention
and Visitors Bureau, recalled her active role, as NYC Deputy Mayor, in
promoting the Kenmore renovation: "At long last, we can come
together to celebrate the opening of the new Kenmore Hall. But today, we
must also focus on why it took so long to complete a project that so many
supported - government, law enforcement, the community, and the people
truly in desperate need of supportive housing. Our need for all kinds of
affordable housing remains great, therefore the same kind of tenacity and
commitment HSI brought to this project must now be mustered to ensure
that future worthy projects take far less time."

Funding Sources for Kenmore Hall

  • $5 million in New York City low-interest loan funds
  • $4 million in New York State low-interest loan funds
  • $14 million in Project Equity
  • $1.6 million in commercial bank financing
  • $2.2 million in U.S. HUD Supportive Housing Funds
  • 300 U.S. HUD Section 8 Rent Subsidy Certificates
  • $8.5 million from NYC Housing Preservation and Development Rent
    Guarantee Fund
  • $170,000 in private contributions
  • $784,800 in sponsor contributions

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