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Preventing Manufacturing Displacement: Announcing an Industrial Development Financing Milestone
Mission-Driven Developer Closes on New Hunts Point Industrial Center Bringing with It Manufacturing Jobs to The Bronx
Long-time mission-driven developer Mutual Housing Association of New York (MHANY) – with the support of the Association for Neighborhood & Housing Development (ANHD), Citi, and the New York City Economic Development Corporation (NYCEDC) – is transforming a juvenile detention center in the Hunts Point section of The Bronx into a vibrant mixed use campus that combines affordable housing, commercial space, and good-paying manufacturing jobs. This closing on Building 1A of the phase one redevelopment of the Spofford Juvenile Detention Center is the second to fully utilize New York City’s new industrial development framework and represents a growing movement to preserve and equitably develop industrial spaces in our neighborhoods.
Combined with smart land use policy, developments like Building 1A seek to prevent the displacement of manufacturing centers and work to ensure there are quality jobs for community residents. Building 1A represents a total development cost of over $30 million and will construct a modern 58,000 square foot industrial facility that will create 75 new jobs for Hunts Point. MHANY was named the lead developer for Building 1A and is one of the many mission driven developers throughout New York City committed to promoting, developing, and managing affordable housing in New York.
“MHANY is delighted to close on a project that we know will have a significant economic development impact on Hunts Point,” said Ismene Speliotis, Executive Director of MHANY. “This public / private industrial development provides a modern space for future employers to hire Hunts Point residents with quality jobs that can assist in building community power, wealth, and neighborhood stability.”
While MHANY has developed 1,800+ affordable rental units over the past 30 years, until now, it has never lent its development and community-oriented approach to help spur equitable economic development. That is now changing though, in large part thanks to new financing tools and resources emerging in New York City to support this critical community development work.
With the assistance of the Urban Manufacturing Accelerator Fund (UMAF) – supported by founding investor Citi and managed by ANHD – industrial developers like MHANY receive hands-on technical assistance and pass-through grant funding of up to $60,000 to augment pre-development expenses related to closing on the NYCEDC Industrial Developer Fund (IDF). NYCEDC launched the IDF in 2016 to leverage public and private investment to preserve and create industrial job creation centers throughout the five boroughs. MHANY was able to secure the data, financing and architectural services, and legal counsel to bring the closing of the first project in the La Peninsula mega development to fruition.
“Urban manufacturing jobs hold excellent potential to create an inclusive path to higher-wage employment and greater economic security for New York City households,” said Greg Schiefelbein, Citi Community Development NY Tri-State Director. “The Urban Manufacturing Accelerator Fund was created to help nonprofit developers unlock significant investment and expand their ability to generate and preserve industrial jobs. By supporting the Fund, we aim to help enable ANHD and NYCEDC to support mission-driven developers, like MHANY, to build more equitable communities.”
As ANHD has reported on in the past, data suggests that mission-driven non-profit developers generally create a greater public benefit. They are motivated to find extra value for the community instead of prioritizing their bottom-line economic interests, including a consistent emphasis on developing at deeper levels of affordability, a commitment to keeping the project permanently affordable, as well as a general practice of investing the developer fees from the building into added community services.
“La Peninsula's Building 1A highlights a great example of what equitable economic development can look like,” said Council Member Rafael Salamanca, Jr. “It includes development that smartly addresses job creation in and for our neighborhoods while preserving the industrial fabric of our communities. It is that same industrial fabric that provides community residents with access to quality jobs and economic mobility. When completed, La Peninsula will serve as an economic engine for the Hunts Point Community. I applaud MHANY, NYCEDC and ANHD for their partnership in making this project a reality.”
MHANY’s closing today represents a big step forward towards ANHD’s larger goal of creating an equitable economic development ecosystem in New York City. ANHD has been pushing for more clarity around and equity in the City’s economic development investments since 2015, starting with manufacturing — a growing field with high-quality jobs and economic growth opportunities for and in low-wealth communities. Our strategy is to build off the affordable housing ecosystem we’ve developed since 1974 and create the same high level of engagement and tools for economic development so that the City invests more equitably in its communities. The involvement of mission-driven developers in economic development is key to promoting equity.