HUD concludes $26 million rent aid demonstration conversion with Philadelphia Housing Authority to create 58 newly built affordable homes

HUD No. 22-127
HUD Public Affairs
(202) 708-0685
July 6, 2022

New Affordable Rental Homes Part of Philadelphia Sharswood/Blumberg Community Redevelopment Plan

WASHINGTON, DC — The Office of Multifamily Housing of the United States Department of Housing and Urban Development announced today that it has entered into a Rental Assistance Demonstration (RAD) transaction with the Philadelphia Housing Authority (PHA) to build 58 new affordable rental homes in the Sharswood/Blumberg community neighborhood. These homes are built on both vacant lots and locations with destroyed structures.

The RAD transaction includes a $26.1 million ($450,000 per home) construction budget, funded entirely through several sources:

  • Choice Neighborhood Implementation Financing
  • Public housing Moving to work Funds
  • Transitional financing for demolition/disposition of public housing
  • Equity for low-income housing
  • Commercial First Mortgage Loan

This RAD transaction supports the revitalization of a neighborhood that has suffered from vacancy, with more than 1,300 vacant lots. To date, the PHA has retained 1,900 public housing through RAD, enabling the investment of $467 million in financing for renovations and construction activities. Of the PHA’s 29 closed transactions, 18 are new construction and 16 are using an aid transfer.

Sharswood Phase 4A is the third transaction of the PHA’s Blumberg/Sharswood Choice Neighborhood Implementation (CNI) scholarship. The transaction will create occupied, affordable rental housing, enabling the redevelopment of existing devastated properties and the construction of new parks, schools and meaningful and empowering social services for residents, including improving education, health and work readiness through new and ongoing programs.

Sharswood Phase 4A includes the construction of 6 accessible homes and 3 additional homes for the hearing or visually impaired. Construction will include sustainable design elements, guided by two green rating programs, Enterprise Green Communities and Energy Star Certified Homes, and will achieve a reduced Home Energy Rating System (HERS) rating. Every home will also include wired broadband capabilities. Finally, the construction will include a self-contained community center equipped with a kitchenette and outdoor space, as well as a property management office and dedicated office space for a social service coordinator.

About RAD

RAD was designed to address the nationwide multi-billion dollar backlog of deferred maintenance in the public housing portfolio and the loss of affordable housing that could no longer be held to decent standards. From the start of the program until June 1, 2022, Rental assistance demonstration has facilitated more than $14.5 billion in capital investment to upgrade or replace nearly 175,000 high-rent homes, most of which house extremely low-income families, seniors and individuals with disabilities.

Under RAD, projects funded under the public housing program convert their social housing assistance into project-based Section 8 rental assistance. Under Article 8, residents continue to pay 30% of their income in rent and the housing must continue to serve very low and extremely low incomes, as was the case when the property was supported through the public housing programme. Residents must be notified and consulted prior to refurbishment, given the right to return to assisted living after construction, so that the same tenants can enjoy these newly preserved and upgraded apartments and retain the same fundamental rights they had as residents of social housing.

RAD Resources

More programmatic information is available on the RAD website† Data on RAD is available on the RAD Resource Desk

View photo essays and read case studies where RAD works to successfully maintain and improve public housing for low-income families.

Watch an educational video for residents of public housing or for those new to the RAD program.

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