A Hotel Conversion Creates New Affordable Housing

A $880,000 bridge loan from the Leviticus Fund is helping a New York City-based nonprofit expand its successful work in housing the formerly incarcerated. Our loan is supporting the Fortune Society’s efforts to acquire a seven-story single-room occupancy (SRO) hotel on West 97th Street in Manhattan.

The Fortune Society was founded in 1967 and is New York City’s premier organization dedicated to supporting the successful re-entry of people released from prison. The organization owns and operates 189 units of transitional and permanent housing throughout the area and provides a variety of services and resources at each of its facilities to help residents break the cycle of incarceration and rebuild their lives.

Soon after COVID-19 hit, the Fortune Society, like many homeless services providers, saw a once-in-a-generation opportunity to acquire struggling SRO hotels and convert them into affordable housing. The organization plans to convert the Upper West Side property into 85 single-occupancy permanent housing units. Of those 85 units, 67 will house homeless individuals who have histories of involvement with the criminal justice system and are referred by the Department of Homeless Services. Current tenants will continue to occupy the remaining 18 units.

Leviticus’ loan will fund what is termed an “earnest money deposit,” which is required by the current property owner before entering into a purchase and sale agreement. The deposit allows Fortune Society to conduct the necessary due diligence on the property’s condition before making a final decision on the purchase.

This is Leviticus’ second loan to the Fortune Society. In March 2020, we provided a $1 million predevelopment loan to support the development of Castle III, a 79-unit affordable and supportive housing project in East Harlem. This new loan will enable the Fortune Society to continue providing services that are transforming the lives of some of the city’s most vulnerable residents.