Superior Affordable Housing

(1)

February 22, 2021

Superior

Affordable

Housing

(2)

About Element

• Boulder County firm

• Established 2010

• History of Public Private

Partnerships

• Reputation for Sustainable Projects

• Market Rate Housing

• Aﬀordable Housing

(3)

Market Rate

Housing

• Completed 10 multifamily projects

(apartments, townhouses, condos)

• Many included community process,

input, entitlement

• Currently finishing $200mil TOD, mixed

use, mixed income, S’PARK project in

Boulder with 306 units, 35% aﬀordable

housing on-site, and first LEED-ND

Silver project in Colorado

(4)

• Completed 338 aﬀordable housing 60%

AMI or lower units across 4 projects

• Extensive experience forging successful

partnerships with non-profits, cities,

faith-based groups and stakeholders to

achieve housing goals

• Currently 2 additional projects in

pipeline partnered with Cities of

Longmont & Boulder

(5)

• Ciclo at S’PARK

• Completed in 2020

• 38 units at 60% AMI

• Workforce-Oriented, Studio, 1&2-bedrooms

• City of Boulder provided $100,000 per unit

subsidy for gap funding

• Boulder Housing Authority provided

Property Tax Exemption

• CHFA awarded Private Activity Bonds

(6)

• The Nest Apartments

• Completed renovation of 238 units in 2017

• 50-60% AMI

• Workforce and Family-Oriented

• City of Boulder provided $60,000 per unit

subsidy for gap funding

• CHFA awarded Private Activity Bonds

• Google provided $40mil in subsidized

interest rate senior loan

(7)

• Trinity Commons

• 16 Age-Restricted Senior Units in 2018

at 60% AMI

• Trinity Lutheran Church contributed

land and property tax exemption

• City of Boulder provided $76,000 per

unit in gap funding subsidy

• CDOH provided $55,000 per unit in “soft

funding” grants

(8)

• Spark_west

• 45 Family-Oriented flats completed in 2018

• Recipient of 2013 Flood Recovery Funding

from FEMA

• City of Boulder provided $93,000 per unit

subsidy for gap funding

• CHFA awarded Private Activity Bonds

• Boulder Housing Authority provided

property tax exemption

(9)

Regional Housing Conditions

Regional Current Market Stats

• Year-over-Year Change in SFR Home Prices: 15.7% (February 2020 - 2021)

• 252 SFR’s on the Market Represents 0.7 months of Inventory (February 7th)

• Denver Metro is absorbing 7,793 apartments per year, compared to 4,887 per

year on average for the last 16 years

• Denver Metro Q4-2020 vacancy was 6.05%, with highest vacancy in small units

(due to changes tastes and behaviors in pandemic)

• Aﬀordable Housing (LIHTC) Q4-2020 vacancy was 2.94%

(10)

Regional Housing Conditions

(11)

Boulder County Regional Housing Partnership Goals

(12)

Boulder County CHFA Rents & Income

Regional Housing Conditions

60% AMI and

below required for

Federal LIHTC Subsidy

(13)

Affordable Housing

Calculating Local Gap

Funding Needed for Projects

Sources

Senior Mortgage

LIHTC Equity

Potential Grants

Total Sources

Uses

Land

Hard Costs

Soft Costs

Total Uses

Sources minus Uses = Local Gap

Funding Needed

(14)

Affordable Housing

Superior Example for 2021

Hypothetical Aﬀordable Project

• Assumes Half of Units @ 50% AMI, 1&2-bedrooms

• Assumes Half of Units @ 60% AMI, 1&2-bedrooms

• Assumes Earning 4% LIHTC Award

• Assumes No Grant Capital Sources

• Various Cost Assumptions (construction costs, permits, etc)

• Various Operating Assumptions (rents, property taxes, vacancy, etc)

• No Land Costs Assumed Yet

Results in Gap Funding Needed of

$50,000 Before Land Costs

Reasonable to Expect Total Local

Subsidy Needed of $75,000 - $100,000

(15)

Models for Success

Element Partnerships with Other Cities

Case #1 - Boulder Workforce Housing Initiative (2015)

Goal: create public-private-partnership to acquire, renovate,

and preserve as aﬀordable 238 apartments within the City

of Boulder at 50-60% AMI

• Element initially optioned the land under competitive

marketing process

• Applied to City for approx. $15mil in subsidy in exchange

for accepting Permanent Aﬀordability Covenants, or

$63,000 per unit

• Paired City subsidy with 4% LIHTC

• Element recruited financial assistance from Google for

subsidized permanent debt loan terms

• Renovation included major building systems upgrades,

life safety enhancements, and new resident amenities

Case #2 - Longmont Desire to Create Deep Aﬀordability (2020)

Goal: create a public-private-partnership to develop 55-units of

30% AMI Housing on City-owned Land

• The City of Longmont contributed all land to the partnership

under an Option Agreement approved by City Council in

exchange for Permanent Aﬀordability Covenants

• Option Agreement was accompanied by a $100,000

“pre-development costs stipend” for non-developer-related, 3rd party

design and engineering costs

• Developer and City worked together to ensure project met the

community’s needs

• City has provided expedited permit processing to reduce project

timeline and associated costs

• Project went from Council approval of partnership in October

2020 to 9% LIHTC application in February 2021 (3 months

process)

(16)

RTD Site

• 3.95 acres, flat

• RTD Lot with ~320 stalls

• Adjacent to Marketplace

(17)

RTD Site Suitability

for Housing

•

Premier Transit Oriented Development (TOD) Opportunity with Bikeway Access and RTD Bus Rapid Transit Station

•

Walkability with access to Dining, Amenities, Shopping, Healthcare, Entertainment, Founder’s Park, and Downtown Superior

•

Site Leverages Multiple Existing Community Investments for Benefit of Aﬀordable Housing Residents

•

Site Plan Could Accommodate ~150-200 units

•

1 and 2-bedroom Residences Ideal to Support Core and Essential Workers from Superior and Surrounding Community

•

Ideal Candidate for LEED status and accolades

•

Missing Piece is Housing to Create a Vibrant Place

•

Challenges are potential RTD process adding to timeline and possible need to replace Transit parking ($25,000 per space or more), thus, adding to Land Costs and Gap Funding needed

(18)

RTD Process

Historical Challenges of “Unsolicited Proposal” Process

(19)

RTD Process

Potential New Policies under “Equitable TOD”

RTD’s recently-proposed Equitable TOD policies (link) are summarized as follows:

1. Affordability Goal - Permit and encourage the development of affordable housing, 35% of affordable housing on RTD

sites measured systemwide, adopt definition of Aﬀordable Housing at set by CHFA at 60% or below of local AMI.

2. Parking Replacement - RTD acknowledges a) that low-income households have high RTD utilization and low car

ownership rates (link), and b) the high cost of transit parking (“$25,000 or more per parking space”) and suggests that

these replacement costs could be deducted from negotiated land costs.

3. Shared Parking - Consideration of “shared parking” opportunities to reduce parking infrastructure costs for Developer.

4. Expedited Administration - Consideration of waiving internal processing and development review fees, minimize

review times, and attract developers and reduce development uncertainty, costs, and schedules.

5. Negotiated Land Price - RTD may assess and consider other agency benefits for determination of sale or lease price.

Equitable TOD was discussed by the RTD Planning/Capital Programs & FasTracks Committee on February 2nd, 2021.

Meeting Minutes (link) indicate that the Committee recommended the Equitable TOD policies to the Board.

(20)

Alternate Superior Sites

Potential Other Opportunities for Aﬀordable Housing

RTD

Park n Ride

3.95 acres

Brixmor

Retail

Redevelopment

Approx 4.5 acres*

Wiehe Property

Non-Annexed

12.5 acres*

*Element has had no discussions with any of these property owners and cannot represent their

Brixmor

Pad

2.18 acres*

(21)

Additional Information & Next Steps

Draft Steps & Timeline For Discussion

Element to Perform Additional Due Diligence with Town of Superior Staﬀ, Explore

Alternate Sites, Consultation with CHFA, Boulder County Housing Authority (Q1-2021)

Propose Memorandum of Understanding, including Goals, Housing Types, Aﬀordability

Levels, Form/Bulk, Parking, Gap Funding Needed (Q2-2021)

Site Selection & Negotiation (Q3-2021)

(Please note this milestone and those that follow are dependent upon RTD or other Property Owners’ responses and timing)

Community Input (Residents, Staﬀ, Board), Brixmor Feedback (Q3-2021)

Submit Town Concept Plan (Q4-2021)

Apply for 4% Low Income Housing Tax Credits (Q1-2022)

Construction, Delivery, Lease-Up (2022-2023)

(22)

(23)

Aﬀordable Housing: Any housing that is subsidized by the federal, state and local government, or any housing where units are subject to long-term covenants or deed restrictions which require

that the units be sold or rented at levels that preserve them as aﬀordable housing for a specific period of time.

Area Median Income (AMI): A midpoint in the income distribution by household size in a defined geographic area. The AMI is used to determine eligibility of applicants for housing programs.

The U.S. Department of Housing and Urban Development (HUD) adopts and publishes AMI limits annually.

Boulder County Housing Authority (BCHA): The housing authority for areas of Boulder County outside the city limits of Boulder and Longmont.

Colorado Division of Housing (CDOH): Provides state and federal funding to private developers, housing authorities, and local governments to increase the inventory of aﬀordable housing.

Colorado Housing and Finance Authority (CHFA): Oﬀers financial resources (low-income tax credits and mortgage programs) as an investment in aﬀordable housing and community

development.

Low Income Housing Tax Credits (LIHTC): A federal program administered locally through CHFA; an indirect federal subsidy used to finance the development of aﬀordable rental housing for

low-income households.

Leadership in Energy and Environmental Design (LEED): The most widely used green building rating system in the world. Available for virtually all building types, LEED provides a framework

for healthy, highly eﬃcient, and cost-saving green buildings. LEED certification is a globally recognized symbol of sustainability achievement and leadership.

Market Rate Housing: Housing with rent levels, or sales prices, that are consistent with the housing market of the surrounding area; this includes all housing that is not income deed-restricted.

Sustainable Development: Development that balances housing development, transportation investment, water infrastructure, economic development, land use planning, environmental

planning, environmental conservation, open space, and other infrastructure priorities for the region.

Transit-Oriented Development (TOD): A type of community development that includes a mixture of housing, oﬃce, retail and/or other amenities, integrated into a walkable neighborhood and is

located within a half-mile of quality public transportation.

Housing and Urban Development (HUD): The federal housing and development agency that collaborates with states and local municipalities to create, maintain and improve a variety of

housing options for residents of diﬀerent incomes and needs.

Workforce Housing: Aﬀordable housing for households with earned income that is insuﬃcient to secure quality housing in reasonable proximity to the workplace.