|HUD No. 23-003
HUD Public Affairs
January 6, 2023
HUD CLOSES RENTAL ASSISTANCE DEMONSTRATION (RAD) CONVERSION IN BOSTON, MA, TO PRESERVE 445 AFFORDABLE RENTAL HOMES
$66 million transaction with Boston Housing Authority (BHA) preserves and rehabilitates 445 public housing homes as permanently affordable housing at Mission Main.
WASHINGTON, D.C. - The U.S. Department of Housing and Urban Development’s Office of Multifamily Housing announced today that it recently closed a Rental Assistance Demonstration (RAD) transaction with the Boston Housing Authority (BHA) in Boston, MA, at Mission Main in the Mission Hill neighborhood. This transaction will preserve and rehabilitate 445 deeply affordable rental homes using a RAD/Section 18 Blend, a component of RAD that allows for higher levels of funding to preserve and rehabilitate affordable public housing rental homes which, without the blend option, would otherwise not be financially feasible.
Mission Main, a development of 535 rental homes, currently includes 31 residential buildings comprised of a 120-home mid-rise building for low-income seniors, and 30 townhomes, including the 445 public housing rental homes preserved through RAD.
Through RAD, homes at Mission Main will receive significant kitchen and bathroom rehabilitation, select flooring and painting upgrades, and select HVAC upgrades. To promote energy efficiency and conservation, new energy and water efficient kitchens and baths with a new net-zero hybrid heating and cooling system will be installed in Mission Main’s building for low-income seniors. Higher energy efficiency will also be achieved through-wall air conditioner and heater openings, air conditioning sleeves, and air conditioning units in all 30 townhome building bedrooms. Additionally, there will be supportive services on site including after-school, youth, and senior programs.
The RAD transaction includes a $66 million construction budget ($123,000 per home) fully financed through:
- FHA-insured mortgage from the Massachusetts Housing Finance Agency through FHA’s Section 542 (c) risk-sharing program
- Public Housing Authority non-federal funds
- Massachusetts Housing Finance Agency funds
- 4% Low-Income Housing Tax Credit equity
The investments facilitated through RAD reinforce the property’s ability to serve as affordable housing for the long-term.
RAD was designed to help address the multi-billion-dollar nationwide backlog of deferred maintenance in the public housing portfolio and to stem the loss of affordable housing that could no longer be kept to decent standards. From the program’s inception through January 1, 2023, RAD has facilitated more than $15 billion in capital investment to improve or replace nearly 185,000 deeply rent-assisted homes, most of which house extremely low-income families, seniors, and persons with disabilities.
Under RAD, projects funded under the public housing program convert their public housing assistance to project-based Section 8 rental assistance. Under Section 8, residents continue to pay 30% of their income towards rent and the housing must continue to serve those with very low and extremely low incomes, as was the case when the property was assisted through the public housing program. Residents must be notified and consulted prior to conversion, are given a right to return to assisted housing post-construction so that the same tenants can enjoy these newly preserved and improved apartments and maintain the same fundamental rights they had as public housing residents.
About RAD/Section 18 Blends
A RAD/Section 18 Blend allows Public Housing Authorities (PHAs) to "blend" project-based voucher assistance through a RAD conversion with assistance from tenant protection vouchers that are awarded through a Section 18 disposition approval. Since its creation in 2018, over 60 PHAs have completed almost 100 transactions using the RAD/Section 18 Blend. Through these conversions, PHAs were able to invest over $4 billion to substantially rehabilitate or redevelop approximately 25,000 public housing homes, providing significantly improved housing conditions for low-income families.
More programmatic information is available at the RAD website. Data on RAD is available at the RAD Resource Desk.
View photo essays and read case studies where RAD is working to successfully preserve and improve public housing for low-income families.
Watch an educational video for public housing residents or those new to the RAD program.