Note: This story has been revised to clarify the purchase price for Hope Village Apartments. An earlier version attributed the price to the larger portfolio sale.
A Henrico apartment complex appears headed for a round of renovations after a recent sale that included another local low-income housing property.
The 100-unit Hope Village Apartments at 1605 Hope Road in Glen Allen sold March 16 for $9.2 million in a portfolio sale that included one other local property: the 132-unit Woodland Crossing Apartments at 3459 Walmsley Blvd. in Richmond’s Southside.
Fairstead Affordable, an affiliate of New York-based real estate investment firm Fairstead Capital, purchased the portfolio from GHC Housing Partners, a national income-based housing firm in California.
Bobby Byrd, a vice president with Fairstead Affordable, confirmed the purchases, which were not reflected on online property records Tuesday.
The latest Henrico assessment valued Hope Village, which was built in 1973 and totals 6.7 acres, at $6.32 million. A city assessment valued Woodland Crossing, built in 1975 and totaling 12.6 acres, at $6 million.
Fairstead, through an entity called Hope Preservation LP, is seeking up to $13 million in bonds to pay for upgrades to Hope Village that could amount to as much as $42,000 per unit.
The bonds would be issued through the Suffolk Redevelopment and Housing Authority, which Byrd said Fairstead had engaged to secure funding for another portfolio property in Suffolk. Byrd said the company is working with that authority because Henrico does not have a housing authority through which Fairstead could apply for low-income housing tax credits.
Both Hope Village and Woodland Crossing are Section 8 housing through the U.S. Department of Housing and Urban Development, meaning tenants pay a fixed percentage of their income. Byrd said those rent structures are unaffected by the sale.
Because the property is located in Henrico, county supervisors must sign off on the request before the Suffolk authority can issue the bonds. A public hearing on the request was scheduled for the Henrico board’s regular meeting Tuesday night.
Once the approvals are secured, Byrd said the company would apply for tax credits from the Virginia Housing Development Authority – a process he anticipates to be complete by late summer. Byrd said the upgrades to Hope Village would get underway thereafter.
The company is planning interior and exterior enhancements to the property, which is located along Mountain Road just west of Brook Road. Improvements to units would include HVAC and kitchen upgrades, energy efficiency improvements, and new flooring, lighting and paint. Exterior work would include improved site lighting, and Byrd said 10 of the units would be converted to make them ADA-compliant.
Byrd noted the improvements are contingent on the total amount of funding awarded.
The same is the case for Woodland Crossing, which Byrd said would not be scheduled for potential improvements until 2019. He said renovations to that complex that were done 15 years ago require the company to wait until the end of this year before it can move forward with upgrades.
Other deals in recent years have maintained local properties as Section 8 housing. In late 2016, the 250-unit Ashley Oaks Apartments near Montrose Heights and the 99-unit Newman Village Apartments in Northside were refinanced as part of a nearly $24 million transaction.
North of Newman Village, locally based Genesis Properties is in the midst of a $15 million rehab of the 1940s-era Bellevue Apartments along Chamberlayne Avenue.