A rendering of a 65- to 70-unit apartment development for residents in need of affordable housing and those with special needs, which will be built by Pennrose LLC and RWJBarnabas Health in partnership with the New Jersey Housing and Mortgage Finance Agency — Rendering by Kitchen & Associates/Courtesy: Pennrose
By Joshua Burd
A developer is partnering with one of the state’s largest hospital systems to create dozens of affordable housing units near Newark Beth Israel Medical Center.
The New Jersey Housing and Mortgage Finance Agency, which is helping to subsidize the project, announced Monday that Pennrose LLC and RWJBarnabas Health would develop 65 to 70 apartments on the 977 block of Bergen Street. The organizations have proposed the $25.7 million development under the state’s Hospital Partnership Subsidy Program, in which HMFA matches funding contributions from participating hospitals to provide apartments for residents in need of affordable housing and those with special needs.
Construction is slated to begin this summer, with completion in September 2021.
“Innovative hospital partnerships like the one we are announcing today are taking hold in New Jersey because they are an effective way of providing affordable housing with supportive services for those most in need,” said Lt. Gov. Sheila Oliver, who also serves as commissioner of the Department of Community Affairs and chair of the HMFA’s board. “This new collaboration with RWJBarnabas Health is going to create dozens of homes for our most vulnerable residents while building upon the redevelopment that is already happening in the South Ward.”
Located in the South Bergen Redevelopment Area, the new six-story building will be roughly two blocks from RWJBarnabas’ Newark Beth Israel Medical Center, according to an HMFA news release. To that end, the ground floor will include healthy food retail options, as well as other commercial and program space to enable RWJBarnabas Health and its affiliates to provide services to the community.
Plans call for one- to three-bedroom apartments for residents earning an average of 60 percent of the area median income. Several units will be reserved for homeless individuals and families, paired with access to medical services.
“Ensuring that all individuals have access to safe, stable and affordable housing is a critical component to build healthier communities,” said Barry H. Ostrowsky, CEO and president of RWJBarnabas Health. “RWJBarnabas Health and Newark Beth Israel Medical Center have worked diligently with our partners to develop systems that address social issues such as food security, community safety, workforce development and enhancing the capacity of local vendors within Newark. The Hospital Partnership Subsidy Program allows us to extend our commitment to residents within the South Ward.”
Pennrose is expected to apply to the Department of Community Affairs for project-based rental vouchers to subsidize the cost for the homeless individuals and families who will be part of this development, the news release said. The project, meantime, would include $3.04 million in mortgage financing from the HMFA, $1.5 million from its Special Needs Housing Trust Fund and $4 million from its hospital program to be matched by RWJBarnabas Health.
The developer is also seeking 4 percent federal Low Income Housing Tax Credits, which are administered by HMFA and will generate private equity.
“Pennrose is thrilled to be working with RWJBarnabas Health and NJHMFA at this important nexus between health care and housing,” said Jacob Fisher, regional vice president for Pennrose. “We would like to recognize our partners for the vision that they bring to this endeavor and hope that together we will make a lasting impact on the health outcomes of our residents and on the neighborhood.”
Unveiled in 2018, the Hospital Partnership Subsidy Program offered an initial $12 million to fund four hospital partnerships, HFMA said. But interest has been so great that the program has since been expanded to provide $30 million toward seven to eight partnerships.
The first partnership, with St. Joseph’s Health in Paterson, was announced in 2019.
“As anchor institutions, health care systems like RWJBarnabas Health have a vital role to play in strengthening and growing healthier communities. The collaborations created under the Hospital Partnership Subsidy Program enable them to do that,” said Charles A. Richman, HMFA’s executive director. “We have received tremendous interest in the program throughout the state. As a result, we have already expanded our plans for this program and the holistic approach it embraces to ensure a healthier New Jersey.”
Officials also noted that the development is close to retail, restaurants, schools, a public library and medical offices, the news release said. NJ Transit buses run along Bergen Street, connecting to Newark Penn Station and downtown Newark.
“RWJBarnabas has been an outstanding health provider and neighbor to the City of Newark. This partnership with the Murphy administration shows Barnabas’ commitment to improving the lives of all Newarkers,” Mayor Ras J. Baraka said. “It will address a major issue for our administration — providing our residents with quality affordable housing, particularly our homeless individuals and families who are most at-risk. We applaud the development of this initiative and are pleased to be taking another step towards ensuring that our community is more empowered and healthier.”