T
he Department of Housing Preservation and Development (HPD) is launching a new pilot program to streamline the process of securing funding for rent-stabilized building renovations. The Capital Partnership for Affordable Renovation Loan Program will allow select lenders, including nonprofits Community Preservation Corporation and Local Initiatives Support Corporation, to handle due diligence, eligibility assessments, and early screenings of prospective landlords.

    This approach aims to ease workloads at HPD and dedicate resources to more complicated deals. By pushing some of the upfront work to lenders, HPD officials hope to work with more owners and close more deals. The pilot program will provide low-interest loans and up to $80,000 per unit in subsidy for rent-stabilized buildings undergoing moderate renovations.

    HPD's deputy commissioner of development, Kim Darga, noted that this setup could simplify the process for borrowers by dealing with one party rather than multiple entities. "It's a less complicated interaction, and hopefully it allows us to get money into projects faster," she said.

    The program builds on HPD's existing Participation Loan Program, which also relied on lenders to handle initial due diligence. While the agency didn't share an estimate of how many properties might participate in the pilot, it appears focused on moderate rehabs rather than rescuing buildings in acute distress.