CPC believes that stable and sustainable affordable housing is the foundation of strong communities and we strive to contribute to comprehensive neighborhood revitalization through our lending and partnerships.
A nationally recognized leader in affordable housing finance, CPC has provided a consistent source of capital to underserved housing markets throughout New York State since our inception, in 1974. CPC is committed to delivering financing, technical expertise and to working closely with a range of community partners to create and preserve affordable housing.
Over our 38-year history, CPC has contributed to the preservation or creation of nearly 145,000 units of affordable housing, initiated numerous downtown revitalizations, and improved the quality and energy efficiency of the multifamily stock.
In 1972, a report undertaken for the New York Clearing House Association analyzed the city's problems of housing deterioration and abandonment. It recommended creation of an organization to improve specific neighborhoods.
The resulting non-profit New York City Community Preservation Corporation was incorporated in July of 1974.
The city's leading commercial banks, under the leadership of David Rockefeller, later joined by the major savings banks under the leadership of Alfred Mills, committed to the necessary financial support. The banks provided funding via two Subscription Agreements for capital contributions, a Revolving Credit Agreement and a Collateral Trust Note Purchase Agreement.
At first, CPC's emphasis was on restoring and rebuilding New York's aging neighborhoods. CPC focused its early efforts on two communities: Washington Heights in Manhattan and Crown Heights in Brooklyn. Because of widespread housing abandonment, the city's Housing and Development Administration (currently the Department of Housing Preservation and Development) designated these communities as Neighborhood Preservation Areas.
CPC worked to coordinate public and private resources to create a "one-stop shop" where local owners could obtain construction and permanent financing, public subsidy, and assistance in moderate rehabilitation. CPC's goal was to preserve the existing housing stock on a scale that could stem abandonment and to create a model that could be replicated elsewhere.
Initial efforts were successful. For example, in Washington Heights, CPC loans helped rehabilitate nearly 12% of the community's housing stock --approximately 9,000 units in about six years.
Nurturing the development of rehab and development specialists in affordable housing has been an important CPC mission.
One key to CPC's early success was the creation of "one-stop" shops that provided financing, public subsidies and expertise in construction. A single source was necessary to help local, often inexperienced owners to upgrade their properties.
CPC also helped develop owners' rehab expertise and experience. In CPC's earliest years, nobody had experience in managing extensive moderate rehabilitations in occupied apartment buildings. Nevertheless, with CPC financing, buildings that needed this work got it done.
Contractors and owners new expertise led to further building rehabilitation. As they improved their rehabilitation know-how, owners then actively sought out dilapidated buildings which they could acquire at low cost. Over time, a virtual army of small owners not only upgraded their properties, but also bought nearby properties to renovate, each time acquiring greater efficiency.
Starting in 1978, CPC reached beyond Crown Heights and Washington Heights to become active in the 19 Neighborhood Preservation Areas. CPC financed the rehabilitation of thousands of deteriorated and dilapidated apartments in uptown Manhattan, the Bronx, and central Brooklyn, and worked with government to reclaim devastated neighborhoods in Harlem, the South Bronx, and East New York.
By the early 1980's, CPC expanded to cover all the non-luxury areas of the city, and in the late 1980's expanded to cover the Hudson Valley. In 1995, CPC formally merged with an upstate New York non-profit mortgage lender, the Community Lending Corporation (CLC). CPC became a state-wide organization, opening new offices in Albany and Syracuse.
Based on its success, the CPC model is being replicated in several states and cities across the country.
One of CPC's top priorities is working with government to create an environment that fosters large- scale housing preservation and redevelopment. This includes programs for real estate tax abatement and exemption, and rent restructuring, as well as a variety of public subsidy programs. Such programs have enabled massive amounts of private investment to support renovation of older, yet salvageable, moderate-income housing.
One example is the Participation Loan Program (PLP) administered by New York City's Department of Housing Preservation and Development (HPD). Under PLP, loans of government money are made to a developer or owner at a 1% interest rate, to be combined with private, market-rate financing to produce a substantial loan amount at a low blended rate. The PLP program made possible the renovation of thousands of deteriorating apartments without displacing the existing tenants.
CPC has also participated in the Third Party Transfer program, designed to avoid taking tax delinquent properties into city-ownership. Instead, under this program, properties are renovated and moved quickly to new, responsible building owners.
CPC also plays an active role in influencing public policy. This includes influencing reasonable water and sewer charges, recent changes in the 421a tax exemption program and prevailing wage legislation.
CPC was a strong advocate of the need for mortgage insurance to enhance the credit worthiness of its loans, which would help to attract new resources into the affordable housing market.
The New York City Residential Mortgage Insurance Corporation (REMIC) was created to attract private investment to poorer neighborhoods. REMIC was critical to CPC's early success. New York State set up a similar mortgage insurance program through the State of New York Mortgage Agency (SONYMA).
In 1984, The Police Pension Fund and the New York City Employees Retirement system agreed to provide forward-committed, permanent take-outs for CPC construction loans, essentially freeing-up significant monies for reinvestment. These agreements were the first in the nation entered into by public pension funds to invest in the rehabilitation of older, multi-family housing.
The New York City Teachers Retirement System and the New York State Common Retirement Fund both joined with their own commitments in 1991. The Pension Fund of the United Methodist Church joined in 1998.
Collectively, the pension funds have committed over $750 million through CPC.
Throughout its three and a half decades, CPC has adapted to meet changing needs.
As New York City's economy moved from recession to expansion, its housing policies shifted. Abandoned buildings of the 70's became opportunities for new affordable housing. But economic expansion also drove up housing costs, making affordable housing scarce. The City, in collaboration with CPC, developed the Vacant Building Program, (modeled after the PLP), as one of several programs to create new housing. Since the program was launched, over 10,000 homes have been reclaimed.
CPC is continuing to address the shortage of affordable housing in New York City, bolstered by Mayor Bloomberg's housing initiatives for New York City's moderate and middle-income communities.
Nowadays, while it is sometimes still necessary for CPC to continue to utilize City funding, both CPC and other developers are more frequently building without subsidies. This is especially true in Harlem, which is rapidly becoming a mixed-income community, with economic growth shaped by middle-income rentals and condominium sales. While subsidized housing helped stabilize this community, non-subsidized projects are increasing.
Other homeownership projects, mostly unsubsidized, have been approved in a diverse range of neighborhoods - from East Williamsburg and Bushwick to Far Rockaway and Astoria, among others. Project size varies, ranging from the construction of two and three family homes to large condominium complexes.
CPC's innovative projects go beyond New York City to communities throughout New York State.
CPC has also helped to rebuild deteriorated downtown neighborhoods in many communities beyond New York City. Many such historic downtowns, once vital centers for business and commercial activity, have fallen on hard times. CPC programs to revitalize these downtown areas have met with tremendous success in Syracuse and the Hudson Valley . Click here to read the New Rochelle success story.
CPC has also been successful in financing group homes for special needs individuals throughout New York State. Working with the State of New York Mortgage Agency and various state social service agencies, CPC has provided the capital funds for the purchase and construction of many such facilities. Click here for our Special Needs Financing.
In late 1992, CPC created CPC Resources, Inc. (CPCR) as a wholly-owned development subsidiary. Its purposes include consulting on a wide range of affordable housing problems and investing equity to purchase troubled residential properties in an effort to restore their viability.
To accomplish this, CPCR created two equity investment funds. Since its inception, CPCR has become a vital force in community development with more than 15,000 homes created or stabilized.
CPCR's most significant accomplishment to date was the restoration of the vast Parkchester complex in the Bronx. This consisted of the purchase, (along with two experienced developers), of the 6,362 unsold condominiums, 438,000 square feet of commercial space, and five garages. The $250 million effort upgraded and modernized all 12,271 apartments, without tenant displacement, and reclaimed this vital community. Click here to read the Parkchester turnaround story.
In addition, CPCR has created a unique Infill Housing Model -- an efficient, cost effective prototype for affordable housing throughout the City. Since completion of the first project under this model--a 16-unit market rate condo in Park Slope-CPCR has adapted the prototype to fit rental as well as ownership housing parameters. This well-received model can now meet housing needs across the income spectrum, and CPCR plans to move forward with numerous additional infill units.