BALTIMORE (June 26, 2023) – After tenants of Westchester West Apartments were informed that their building was going to be sold, they worried that rents would rise even more than they already had and so they worked with the community organization Action in Montgomery (AIM ) to ask Montgomery County to intervene, which it is allowed to do under the County’s Right of First Refusal (RoFR) law. Montgomery County Executive Marc Elrich, in agreement with Councilmember Natali Fani-Gonzalez, asked the Department of Housing and Community Affairs (DHCA) to find a partner who could preserve the affordability for the long term.
This naturally occurring affordable housing rental property includes a large number of three-bedroom or family-sized units. After working with nonprofit housing organization Enterprise Community Development, on June 8, 2023, Montgomery County’s DHCA purchased Westchester West Apartments, a residential property with 345 units located at 3214 Hewitt Avenue in Aspen Hill, Maryland, from Westchester Gardens LLC., for $67 million.
After purchasing the apartment building, DHCA immediately sold the rental housing property for the full amount to ECD Westchester Apartments, LLC, an Enterprise Community Development affiliate. Enterprise Community Development assisted DHCA in the underwriting and due diligence of the acquisition opportunity and will carry out the long-term plan for the property that includes preserving affordability, curing deferred maintenance, and improving operations and services for residents. Enterprise Community Development has budgeted more than $5 million in capital expenditures over 10 years to preserve the long-term viability of the property. Total transaction costs came to $75.8 million.
"Preserving the affordability and enhancing the living experience at Westchester West Apartments is not only a crucial step toward ensuring long-term preservation of affordable housing, but also a testament to our commitment to providing residents with a great place to call home,” said Interim President of Enterprise Community Development Christine Madigan. “Through necessary upgrades and improvements, we aim to create a thriving community that fosters a high-quality living experience for all."
“Preserving affordable housing is an essential part of a successful affordable housing strategy,” said Montgomery County Executive Elrich. “I directed DHCA to use the County’s right of first refusal to match the sale offer, purchase this building, and then transfer to an affordable housing partner. The bottom-line is that we saved the homes of hundreds of families who could have been forced out by increased rents if we did not intervene. If we are going to solve our affordable housing problems, we must get serious and use everything in our toolbox, including using our right of first refusal to intervene in similar transactions that could price out current residents.”
Current rents at Westchester West Apartments are considered affordable to households with incomes between 55% and 60% of Area Median Income (AMI) under DHCA’s 2022 rent and income limits.
Under the terms of this deal, Westchester West Apartments will serve:
• 35 households with incomes at or below 50% of AMI;
• 275 households with incomes between 50% and 60% of AMI; and
• Another 35 units will be unrestricted so as not to displace residents who earn more than 60% of AMI during their tenancy.
“When I realized that the building was about to be sold, I saw this as an incredible opportunity for the County to intervene," said Councilmember Natali Fani-González (District 6). “Working in partnership with County Executive Elrich, we convened meetings with DHCA, and the community alongside AIM, to discuss how we could make this incredible purchase possible. Our low-income immigrant community took action to protect their families from displacement, and that’s why we are celebrating today.”
“Westchester West represents Enterprise Community Development’s largest, workforce housing acquisition to-date and a tremendous opportunity for long-term preservation of affordable housing stock in this key target market,” said Senior Manager of Multifamily Acquisitions for Enterprise Community Development Matthew Carson Crossley. “We are looking forward to upgrading the property and creating a community that residents are proud to call home, as we continue to expand our workforce housing portfolio in the Mid-Atlantic region.”
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Enterprise Community Development is the top nonprofit owner and developer of affordable homes in the Mid-Atlantic and is an affiliate of Enterprise Community Partners. We specialize in high-impact residential development, preservation, property management and resident services for more than 23,000 people who call our communities home. Our $1.2 billion portfolio includes 110 communities and 13,000 homes, positioning us as one of the top five nonprofit owners of affordable housing in the United States. Our mission is to uplift residents and communities and more than 20 percent of our revenues are reinvested in programs and services to advance our residents’ social, educational, financial and physical well-being. For more information, visit www.enterprisecommunitydevelopment.org.