The Housing and Urban Development Department (HUD) recently announced its intention to close 17 of its multifamily housing offices across the country and consolidating staff to no more than 5 hubs (New York, Atlanta, Chicago, Forth Worth, San Francisco) and 5 satellite offices (Boston, Jacksonville, Detroit, Kansas City, Denver). As it currently stands, Minneapolis is among the 17 offices slated for closing.
HUD's Multifamily Housing Programs Office provides mortgage insurance to HUD-approved lenders to facilitate the construction, substantial rehabilitation, purchase and refinancing of multifamily housing projects and administers a number of project-based rental assistance programs.
Why should it remain open?
MHP believes that the Minneapolis multifamily office should be kept open because of its unique and effective approach, built on many years of strong, collaborative relationships.
Minnesota's Interagency Stabilization Group, an initiative consisting of representatives of HUD multifamily staff and other agencies and lenders, represents a collaborative approach that has prevented troubled properties from going into default. It has led to preservation of affordable housing for over 25 years.
This approach has resulted in one of the strongest portfolios of federally-assisted housing and FHA multifamily loans in the country. For example, the percentage of projects with failing Real Estate Assessment Center (REAC) scores is one-third that of the rest of the country. Foreclosure rates appear to be about one-half that of the rest of the country.
The relocation of the Minneapolis HUD multifamily staff to Chicago or Detroit would be very damaging to Minnesota's extremely active, productive and cost-saving approach to affordable housing development and preservation.
Rather than closing the Minneapolis office and risking ending many years of demonstrated success, the office should be held up as a model for other hubs and satellites to emulate.
What can you do?
Both HUD and Members of Congress need to hear how the closing of the Minneapolis multifamily office will affect renters, developers and redevelopers of federally assisted housing, and local agencies that coordinate with HUD.