New York-based Hudson Valley Property Group has acquired the senior housing complex at 801 Locust St. known as the American Postal Workers House, the company said.
HVPG paid $120 million for the 300-unit property, the company said in a statement this week. The seller was a unit of Berger Associates Realty in Narberth, records showed.
HVPG managing partner and cofounder Jason Bordainick said the company intends to continue operating the complex as affordable housing for senior residents.
“We have plans to preserve affordability for the seniors who call it home, while also providing significant upgrades to the building and individual units,” Bordainick said.
Additional tax credit financing is expected to close in the coming months to fund renovations to the property, with a total project cost of about $150 million, including acquisition, the company said.
The American Postal Workers House has used government subsidies to offer below-market rents to tenants. Demand for such apartments is soaring, as market-rate rents and for-sale housing prices rise sharply in the city and beyond, said Adrian Ponsen, an analytics director with real estate market-tracker CoStar Group.
As of Tuesday, rents were up 10% over their year-ago figure to $1,538 per unit, according to CoStar data. Home prices were up 13.3% during the three months ended Sept. 30, compared with the same period a year earlier, according to Federal Housing Finance Agency records.
“Stimulus checks, savings accrued from social distancing, and healthy wage growth have all given landlords and home sellers additional leverage to raise rents and for-sale prices,” Ponsen said. “In an environment like this, rent-stabilized units offer even more of a discount than usual from market-rate properties and, as a result, competition among tenants for affordable housing has never been tighter.”
Transactions involving senior-housing projects have been uncommon in the Philadelphia area in recent years. The sale in May of HeatherGate at Oxford Valley in Langhorne to a group involving Greystar Real Estate Partners and the Carlyle Group was the only known such deal tracked by CoStar since 2019.