City, LIHC Investment Group, Belveron Partners Work to Preserve Affordable Housing in the North End

Even before the COVID-19 pandemic hit Boston was facing a housing crisis. Rising property values and rent have forced many longtime Bostonionas to seek housing elsewhere, sometimes miles from the city they called home for decades.

The pandemic has not helped the situation and more and more residents are facing housing insecurity as job loss and a weakening economy have threatened the stability of many.

Luckily there is some hope on the horizon for North End residents living at Mercantile Wharf in the North End.

On Wednesday, Mayor Marty Walsh announced, together with LIHC Investment Group, Belveron Partners, and the Boston Housing Authority, the preservation of 60 affordable rental homes at Mercantile Wharf with the support of the building’s tenants.

Walsh said the move is building on his commitment to creating and maintaining affordable housing in the City of Boston, especially during these very difficult times.

“Preserving affordability in housing is a top priority for my administration, and I am so proud that with the support of many partners involved we have been able to secure long-term housing affordability for tenants at Mercantile Wharf,” said Mayor Walsh. “I want to thank everyone involved for their support and assistance in keeping these units affordable for residents in the North End.”

According to the city, Mercantile Wharf is a 122 unit mixed-income community that ­received subsidies through the 13A mortgage program in the 1970s, which allowed property owners to secure low-interest loans in exchange for providing below-market rents to tenants.

In 2018, the provisions governing Mercantile Wharf expired, putting it at-risk of losing its affordability as units became vacant and re-rented at market rate.

Instead of allowing this to happen, owners LIHC Investment Group and Belveron Partners have agreed to a preservation plan with the Boston Housing Authority and MassHousing to protect existing residents and maintain the units for low-income tenants in the future.

Under the terms of the agreement, 48 very low-income households at Mercantile Wharf were eligible for and will benefit from a new Project-Based Section 8 contract, guaranteeing their homes will remain affordable for at least the next 20 years. These federally backed, project-based vouchers are a form of rental assistance that stays with the property so if a unit becomes vacant, it is reserved for incoming tenants earning no more than 50 percent AMI. Section 8 also limits the amount a tenant pays toward rent to 30 percent of their adjusted gross income.

Ten low-income households-those with incomes between 51 percent and 80 percent AMI-will receive tenant-based rental assistance from the Massachusetts Rental Voucher Program (MRVP), in addition to two more households that opted into the mobile MRVP program. Households with mobile MRVP vouchers will pay approximately 40 percent of adjusted gross income towards rent.

“This agreement ensures that longtime residents of Mercantile Wharf will continue to remain in their homes and that affordability protections remain in place for decades,” said MassHousing Executive Director Chrystal Kornegay. “MassHousing’s top priority in addressing expiring Section 13A mortgage restrictions is ensuring that at-risk residents are protected, and we thank the City of Boston for its leadership in preserving this important affordable housing resource.”

BHA Administrator Kate Bennett said this was an agreement that will ensure housing stability for dozens of families in the North End.

“Communities like Mercantile Wharf are an essential part of the city’s urban fabric, and we are proud of the role we’ve played in securing their long-term future here in Boston,” she said.

Charlie Gendron, Principal, LIHC Investment Group explained that rising rents in this part of Boston have forced many longtime residents to move elsewhere, however that will not be the case at Mercantile Wharf. LIHC Investment Group has partnered with the City of Boston on several occasions in the past to preserve at-risk properties, including 171 homes at Concord Houses in the South End.

“Prioritizing the preservation of communities like Mercantile is an effective way of maintaining the mixed-income, diverse neighborhoods which made Boston the great city that it is today,” said Gendron. “We wish to thank Mayor Walsh, DND, BHA, and MassHousing for working hand-in-hand to make this preservation possible, as well as our residents and MAHT for their patience, support, and for helping get us across the finish line.”

President of Mercantile Wharf Tenants’ Association Sandi Padellaro said the tenants are thrilled about the outcome.Padellaro and the Association helped spearhead negotiations with the owners and city agencies

“Not only will 60 affordable apartments be saved for our Mercantile Wharf community, but most tenants will actually win a rent reduction,” said Padellaro, . “Ours is the only building in this zip code that offers any affordable housing and its preservation is critical to the stability and future of our beloved neighborhood. We want to thank the Mass Alliance of HUD Tenants (MAHT) for helping us organize and partner with the owners to propose creative solutions that helped save our home.”

Padellaro also applauded LIHC and Charlie Gendron for their flexibility and willingness to help the tenants achieve their vision of an affordable, mixed-income community in a prime location on Boston’s North End Waterfront.

“Over four decades ago Boston pioneered mixed income-affordable housing with Mercantile Wharf and this extraordinary history of inclusion continues today,” said Paul Odland, Founder, Belveron Partners. “Thank you to this entire community for allowing us our part in a historic commitment to another lifetime of preserving these homes.”