Stimulus Helps Housing Project

Stimulus Helps Housing Project PITTSBURGH, PA - Gov. Ed Rendell announced yesterday the award of more than $4 million in federal economic stimulus funds for Wood Street Commons, eliminating a funding shortfall that had clouded the future operation of the Downtown building that houses about 260 low-income people.

The $4,050,000 awarded to Allegheny County and Pittsburgh, will avoid the threat of foreclosure on the 17-story building at 304 Wood St. and will allow it to be transferred from part-owner Tom Mistick to a new nonprofit entity - Residences at Wood Street.

PNC Bank had instituted foreclosure proceedings in Allegheny County Common Pleas Court because Mr. Mistick had not been able to make mortgage payments after the county last fall moved offices out of space it leased there. That move eliminated the bulk of income that sustained the project.

Dennis Davin, director of the Allegheny County Department of Economic Development, said the announcement that the city and county's proposal for funding had been approved was happily received. Despite the financial problems, officials had promised the residents of Wood Street Commons that they would not be displaced.

In addition to paying off the mortgage, the remainder of the funds will pay for building renovations, inside and out, Mr. Davin said.

"This should clear all the financial issues. The property can be transferred, improvements can be made and the overall plan can be pursued to put procedures in place to secure this affordable housing for low-income individuals," Mr. Davin said.

Mr. Mistick has been involved with the building since 1986, when he and Allegheny County entered into an arrangement in which the county rented six floors of office space at $90,000 a month.

That helped subsidize the low rates charged to residents who are marginally employed or who have health problems that prevent them from acquiring traditional housing.

But in September, the county moved its offices from Wood Street Commons as part of a plan to consolidate human service offices in the One Smithfield Street building, which is owned by the county's Industrial Development Authority.

Mr. Mistick said the loss of income and the difficulty during the economic downturn to find commercial tenants to replace the county agency crippled his ability to make mortgage payments.

He said the county's rent payments made up about 90 percent of the building's monthly interest and principal payments on the mortgage. That brought him to the brink of a sheriff's sale that is now avoided.

Mr. Davin said a long-term plan involves in-depth building improvements and aggressive marketing of the building's commercial space to provide income. "This gives us the appropriate amount of funding to take the next step," he said. "The continued operation of the building is much more secure now."
Source: Post-Gazette.com

More Stories

Get The Newsletter

Get The Newsletter

The latest multifamily industry news delivered to your inbox.