Affordable Housing Developer Problems
For my column this week on Arlington's efforts to court yuppies, I wanted to know: Why is it that all the new buildings going up these days seem aimed at a higher-income demographic, when there's clearly demand on the lower end of the spectrum?
The basic answer for that, developers tell me, is fairly simple: Land is expensive along transit corridors like Wilson Boulevard, so they build whatever will command the highest rents per square foot, and so far the market hasn't given them a reason to believe they won't lease.
Because for-profit developers aren't building for the majority of the population, non-profits have stepped into the breach. According to Nina Janopaul, director of the Arlington Partnership for Affordable Housing, non-profits now own 14 percent of the county's rental housing stock. I asked her to explain why the market wasn't delivering the kind of housing that the folks she serves in Arlington really need. The answer is the same as it might be for a private developer: Regulations.
"The communities that really take planning and zoning seriously, and are very proactive, want a fountain in the front, bike path in the back, attractive architecture, LEED certified, and all parking underground," Janopaul says. "Those communities really migrate towards serving higher income folks, bceause higher income folks really appreciate that."
By the time she's done everything a town like Arlington wants, her construction costs are higher than what state agencies think they ought to pay for low-income housing. "It kind of eliminates the cheap construction form, and it reduces supply," she says. "It’s probably what we have to do, but it’s driving up pricing. Quality housing costs money."
In that way, the goals of a well-designed urban place conflict with another tenet of smart growth: Economic diversity. Which just means that communities need to recognize the cost, and find other ways to preserve and generate affordable housing.
In the District, George Rothman of housing developer and lender Manna, Inc. faces another problem: Convincing people they should buy the housing they're able to develop in places where land is still cheap enough to build something that's affordable, like at the Buxton project in Anacostia. “It’s still very difficult to interest people in living East of the River, even in the income categories we serve,” Rothman says.
To help solve that, Manna has launched a campaign called "OWN NOW!" that applies to all housing, not just their own projects. Rather than social media, they're employing more of a community organizing model, working through local organizations, schools, and flyers on the street—certainly not taking Arlington's tack of reaching out to yuppies through social media and happy hours. "I don’t know that we know how to reach that market," Rothman says.
That market might want to take a closer look—it's not often you can find a totally renovated place to live for less than $150,000, even in a community that only dubiously qualifies as "up-and-coming."