CDFI New Jersey Community Capital’s recent deal with the City of Newark will turn 156 abandoned properties into quality domiciles.
March 31, 2014, NEWARK (CDFI Connect) - CDFI New Jersey Community Capital’s recent deal with the City of Newark will turn 156 abandoned properties into quality domiciles and have for-sale signs on them as soon as the spring of 2015.
NJCC’s real-estate arm, Community Asset Preservation Corp. (CAPC), is partnering with the city in redeveloping the properties, which are clustered in four parts of Newark that were especially hard hit by the real estate foreclosure crisis.
Wayne Meyer, president of NJCC, said when the deal was announced on March 19 that it followed the CDFI’s approach of “cost-effective intervention” in cities that have included Asbury Park, Camden, Jersey City and Trenton.
NJCC, founded in 1987 as the Community Loan Fund of New Jersey, is the biggest CDFI in the state.
Meyer spoke to CDFI Connect last week.
Is there something about the Newark housing market that makes it especially difficult for low- to moderate-income families?
It’s expensive. People in Newark can literally see New York City from their houses, and when you’re that close to one of the priciest real estate markets and one of the biggest municipal economies in the world, it has an impact on your own housing costs. Demand for housing in this area is very high. People are having to spend way too much for housing, and Newark’s population is growing, which only increases the demand.
What do you say to someone who might be inclined to dismiss as more symbolic than significant your recent initiative to reclaim 156 abandoned properties in Newark?
I say look at the work we’ve done already. We have over $300 million in assets under management, over the past five years or so we’ve lent out more than $150 million in underserved communities, an investment that we have leveraged to create more than $600 million in local impact. That includes roughly 3,000 affordable housing units and 1 million square feet of commercial-development investment. It’s also created close to 5,000 jobs. That’s more than symbolic.
You advocate what you call a “comprehensive” approach to reclaiming neighborhoods. What’s that about?
We invest substantially in housing as a way to stabilize neighborhoods, but we’re also the leading charter-school lender in Jersey, and we’ve provided financial support for small businesses, child-care centers and health clinics. Our ultimate goal is to create a critical mass of economic development that can turn an area around.
How do you even know where to begin -- which street or block -- in a city that needs investment on so many fronts?
We don’t necessarily start on the most abandoned block. We try to build on a stronger block and move toward a weaker block in order to create some momentum that can spread. It’s a stronger-block strategy.
With this housing initiative -- these 156 properties -- do you just go out there and start buying abandoned properties?
We do it through CAPC’s partnership with the city, which by law can use spot-blight eminent domain to take ownership of an abandoned property that is draining the life of a neighborhood. We’ll be working with other Newark nonprofits and local businesses to redevelop and occupy the properties, and we’re using Newark contractors. It is all part of our comprehensive philosophy.
What’s the timetable?
We’ll be closing on some of them within the next 30 days, and we’ll proceed in phases, maybe 30 to 35 at a time. We’ll probably have 50 properties done by this time next year, most of them two- to three-family units, which means a total of 100 to 125 residential units.
What will they sell for?
They’re priced for households with incomes that fall within 50 to 80 percent of the median. A two-family house will probably go for around $175,000. A single-family home will be in the in low hundreds. We’ll also be renting a number of the properties to low-income families in need.
This interview was condensed and edited.
More here about New Jersey Community Capital.
Here’s their recent news release.