Penn, Fannie Mae, among members of housing partnership

The University announced last week that it has teamed up with national financial-services giant Fannie Mae and several other institutions to acquire and manage rental housing units in University City. Administrators say they want to maintain moderate prices in the community's housing market. The Partnership for Quality Housing Choices in University City hopes to act as landlord, superintendent and financier for renters throughout the area. Along with Penn and Fannie Mae, the Partnership includes the University of the Sciences in Philadelphia and Trammell Crow, which currently manages many of the University's real estate and construction projects. First Union National Bank also joined the coalition and has agreed to provide up to $30 million in financing. According to Tom Lussenhop, the University's top real estate official, the Partnership was created to keep costs from rising in the local housing market. "The primary concern is to assure that there is a solid supply of moderate-cost rental apartments throughout University City," he said. However, by being under singular control, some University City residents might also see problems as independent landlords begin to disappear: One of the factors that can help real estate buyers is often competition among landlords. Lussenhop stressed the importance of keeping rents low, especially as the economy begins to recede and landlords look to rebound by renting to high-income tenants. Left unchecked, he said, the market in University City could begin to exclude low-income renters, including undergraduate students. "That cycle is a threat to the diversity of the neighborhood," he said of the rising-rent trend. "But now we will see a much more steady hand at the helm." History Professor and University City resident Michael Katz noted that the Partnership might offer the community a chance to eliminate unreliable landlords. "Anything that does that is something I would welcome with open arms," he said. "Many of the landlords around here haven't done a very good job." Penn and Fannie Mae -- who each invested $5 million in the Partnership -- will act as co-general partners in the initiative, while Trammell Crow is tasked with managing the Partnership's properties. Yvonne Haskins, senior manager of community development for Fannie Mae's northeast office, said the focus of the coalition will be to make housing accessible for students and professionals in the area. In order to keep rents low, she noted, the primary sites the coalition will seek to acquire are currently occupied properties, rather than vacant buildings that would have substantial renovation costs. According to Lussenhop, there are about 8,000 rental units in University City. Penn currently owns University City Associates. "The purpose is not to change them from what they are now -- medium-cost rental housing," Lussenhop said. He added that the Partnership is already "active in looking for opportunities" to acquire property. With such a large-scale project, however, Lussenhop admitted it will take time to determine how successful the Partnership will ultimately be. "The measure will be -- five years from now -- does the neighborhood contain the same economic diversity that it did five years ago?" he said. But with such a broad and powerful group of institutions working together, Haskins predicts success. "We'll be good competition to the landlords out there by raising the bar on living standards," she said.