Portner Flats Washington, DC

Property Information

  • Address: 1440 V Street, NW, Washington, DC, 20009
  • Owner: Portner Flats, LLC
  • Developer and Managing Member: A joint venture between Somerset Portner PF Partners, LLC; and Rose Portner Flats, LLC
  • Number of affordable units: 96 units
  • Affordability: 60% AMI or below, of which 48 units will be 50% AMI or below

Initial Acquisition and Pre-development Financing

  • Equity Investor: Rose Green Cities Fund
  • Lender: Citi Community Capital with Freddie Mac
  • Subordinate Acquisition Loan: DC Dept. of Housing & Community Development
  • Interim Financing: Eagle Bank

Project Partners

  • Architect: Eric Colbert & Associates
  • Construction: Clark Construction
  • Project Labor Agreement: Building and Construction Trades Department & MRCC

Redevelopment Financing

  • Bond & Tax Credit Issuer: DC Housing Finance Agency
  • LIHTC Equity Syndicator & Investor: Boston Financial and Capital One
  • Construction & Permanent: Prudential Mortgage Capital Company
  • Purchaser of GinnieMae Securities (FHA Loan): AFL-CIO Housing Investment Trust
  • Long Term Affordability: Section 8 contract for 48 units for 20 years
  • Owner Financing/ Joint Venture Internal Subsidy: Portner Place, LLC (the joint venture team)

In May, 2018 Mayor Muriel Bowser and other elected officials and community members joined with joint venture development team of Somerset Development Company (“Somerset”) and Jonathan Rose Companies (“JRCo”) to celebrate the grand opening of Portner Flats, a new 96-unit affordable housing high rise built on the former site of Portner Place Apartments at 1440 V Street, NW in Washington, D.C. The original tenants moved back into the new Portner Flats at the end of April and, with hundreds of applications are being reviewed for additional qualified low-income apartment seekers, the building is expected to be 100% leased by the end of May 2018.

Portner Flats serves as a model of how to use zoning density increases to preserve and expand affordable housing in rapidly gentrifying neighborhoods.  The development team successfully used the strength of the market to double the number of affordable apartments from the original 48 units to 96 units, by increasing the zoning density through a Planned Unit Development (PUD) that permitted the construction of 288 market rate apartment on the U Street side of the original site.  The redevelopment is well aligned with the District’s priorities for preserving and expanding affordable housing options in walkable, infill locations with excellent access to mass-transit.

Every resident of the original 48 apartments was provided relocation apartments during the 18 month demolition and construction process as well as a guaranteed return to the new building.  They have returned to a secure, modern, energy efficient apartment building with ample amenities and landscaped spaces.  All 96 units are covered under the Low Income Housing Tax Credit (LIHTC) program assuring affordability at 60% of Area Median Income (AMI) of which half of the units are covered by a HUD project based Section 8 contract which provides deeper affordability at 50% of AMI.

Previously, Portner Place was a distressed 48-unit, HUD Section 8, garden style housing complex located on a 1.1 acre site. The property was purchased by the joint venture and Rose Green Cities Fund in 2013. The property was developed in collaboration with the Portner Place Tenant Association, which exercised its right of first refusal through the Tenant Opportunity to Purchase Act (TOPA) and assigned those rights initially to Somerset and then to the joint venture team. At the time of purchase, the property consisted of 4 garden-style apartment buildings with a large surface parking lot; and suffered from deferred maintenance and security issues in a rapidly gentrifying neighborhood.

The project was powered by the shared vision of residents, the developers, the community and the DC Office of Planning to dramatically increase the density on the site and harness the economic value created by that increase to internally subsidize the development of the new high quality, green affordable units.  Portner Flats was designed to meet Enterprise Green Communities standards, integrating energy efficiency, recycling, resident health and well-being.  High quality amenities include community meeting rooms, a computer lab, fitness room, a playground, a community garden and landscaped outdoor spaces. A resident services program will be offered at Portner Flats, with services such as computer training, after school programs, financial counseling and employment assistance.

Citi Community Capital provided the initial first mortgage loan through Freddie Mac, and Rose Green Cities Fund provided additional equity and bridge financing. The DC Dept. of Housing and Community Development provided an acquisition loan.

The development team was successful in gaining broad neighborhood support for the redevelopment of the site into a new mixed-income, mixed-use property to preserve the affordability for the original tenants and double the affordable housing units by using the market strength of the site to internally subsidize. The project plans were approved by the Historic Preservation Review Board and a Planned Unit Development was secured to increase the allowable density on the site for a maximum of 403 units.

At Portner Flats, the joint venture team obtained a Pass-through for the Section 8 Contract for the original residents to assure affordability for the residents while they were off-site during construction and upon their return.  In addition, the team obtained HUD approval to extend the Section 8 contract for 20 years. Residents were provided supportive services during their temporary off-site relocation and moving assistance.

The redevelopment of the site began in July 2016 first with the construction of Portner Flats, and immediately following with the commencement of construction of the 288 unit, market rate building at 1441 U Street market rate building with ground floor retail, which is expected to be delivered in the Fall of 2018.

 The development of Portner Flats was financed with tax exempt bonds issued by the District of Columbia Housing Finance Agency (DCHFA) and 4% tax credits through the Low Income Housing Tax Credit program (LIHTC). Prudential Mortgage Capital Company (PMCC) underwrote the FHA insured construction and permanent loans through the 221(d)4 program, with the AFL-CIO Housing Investment Trust purchasing the Ginnie MAE securities. Boston Financial served as the Tax Credit Syndicator and Capital One as the LIHTC investor. Owner financing (the joint venture team) provided internal subsidy to expand the number of affordable apartments and the amenity package. Clark Construction completed the project utilizing a Project Labor Agreement (PLA) for the construction of Portner Flats. The building was designed by Eric Colbert & Associates.  Eagle Point Management serves as property manager.

Learn more at: portnerflats.com