Irene McCoy Gaines Apartments, a 151-unit senior public housing development on the south edge of Garfield Park, at 3700 W. Congress Pkwy. is receiving $32.5 million in renovations, changing the ownership structure in the process.
The 17-story building opened in 1964 and is made up of a mix of studios and 1-bedroom units, 30 of which are accessible to people with disabilities. To help finance the project, the Chicago Housing Authority took advantage of the United States Department of Housing and Urban Development’s Rental Assistance Demonstration (RAD) program.
The deal means that, as of Feb. 7, CHA splits the ownership of the building with Michaels Organization, a Camden, New Jersey based developer and building manager. The units are being converted to a Section 8 Housing Choice Voicers development, which allows CHA to take out mortgages and qualify for federal Low Income Housing tax credits.
The renovations will include utility upgrades and rehabbed common spaces. Work began in early March, and it is expected to be completed in 2024.
In the traditional public housing development, a housing authority owns the building and determines tenant policies. Under the Housing Choice Vouchers program, a private landlord owns the building and sets rents. The tenant pays no more than 30% of their income, and HUD covers the rest.
The RAD program was launched to deal with the mounting deferred maintenance backlog housing authorities all over the country have faced. According to the program website, the conversion allows housing authorities to “leverage public and private debt and equity in order to reinvest in the public housing stock.”
RAD includes several provisions to make sure the project remains low-income and that current tenants aren’t kicked out. While landlords can choose to opt out of the Housing Choice Voucher program, RAD requires the contracts to be renewed indefinitely. If the renovations require a tenant to move, they are guaranteed a right to return. If they choose not to return, they would be able to use the voucher at any property that accepts it.
Michaels has been involved in multiple public housing redevelopment projects throughout Chicago, and it provided scholarships to high school students living in CHA developments in the past.
According to the Cook County Recorder of Deeds records, on Feb. 7, CHA sold the building for a symbolic $10 to a limited liability corporation that, according to Secretary of State records, is co-owned by Michaels and CHA. Late last year, Michaels entered into a similar arrangement with CHA for Albany Terrace, a senior housing development in Little Village. HUD signed off on the RAD agreement for both buildings on March 2.
According to CHA, the project will include new HVAC, electrical and plumbing systems. The existing dining/community room will be redesigned, the exterior courtyard and reception areas will be renovated, and laundry facilities will be upgraded. The press release also mentioned new meeting, game, exercise and computer rooms.
CHA CEO Tracey Scott said the conversation will allow them “to continue to provide affordable housing to seniors on the West Side for many years to come.”
“All seniors deserve to live in homes and communities where they can thrive,” she said.
Greg Olson, Michaels’ Regional Vice President of Development, described Gaines Apartments and Albany Terrace projects as “an opportunity to rehabilitate and preserve these important affordable housing resources for seniors.”
“The modernization of this community will enhance the lives of the residents and benefit the South Lawndale and Garfield Park neighborhoods,” he said.
