Affordable Housing Finance

REGIONAL REPORT

West

Creating Community

AFFORDABLE HOUSING FINANCE • June 2010

Bringing co-housing concepts to affordable apartments

BY DONNA KIMURA

The complex features numerous green features, including solar panels and bioswales to collect and filter storm water.

Photo: Treve Johnson Photography

SEBASTOPOL, CALIF.—The residents at Petaluma Avenue Homes don’t just live near one another. They sit down for group meals made from vegetables they grew in a community garden. They participate in different workshops and help keep a watchful eye on each other’s children.

They are residents of a co-housing development that provides 45 individual apartments while promoting community living.

Pioneered in Denmark, co-housing is a type of collaborative housing in which residents actively take part in the operation of their neighborhood. It’s usually a model seen in homeownership communities. Petaluma Avenue Homes is unique because it brings the concept to an affordable rental development, says Susan Friedland, executive director of Affordable Housing Associates (AHA), the Berkeley-based nonprofit developer.

Her group recently built the project with the help of McCamant & Durrett Architects, a pioneer in co-housing in the United States.

The co-housing concept

Located in Sebastopol in Sonoma County, the $16.5 million development is similar to other low-income housing tax credit (LIHTC) projects in its financing package and compliance requirements.

However, its design and attitude are different. For example, all the parking is pulled out to the perimeter, leaving the interior of the property car-free and available for children to play and residents to garden. It also means people have to walk through the complex to get to and from their cars, a move aimed at promoting interaction. The development also features large porches, another design feature that encourages socializing.

Clustered in six residential buildings, the apartments are located around the community space. A large community house is available for group meals and other activities.

About 1,000 applicants sought the new apartments. Some may have been attracted to the co-housing concept while others were likely drawn by the possibility of an affordable place to live. The one-, two-, and three-bedroom apartments serve residents earning between 30 percent and 60 percent of the area median income, with the average below 50 percent, says Friedland.

Developers had to comply with Fair Housing requirements, so they didn’t target select individuals, and there are no obligations to take part in the social activities.

AHA hired a co-housing consultant early on in the process to help implement a plan and work with residents to form a co-housing club.

Jeami Cabrera, 58, was drawn to the development because of its location. “I wanted to live in a place that was easy to get around,” she says, explaining that her new apartment is a short walk from businesses and her doctors’ offices.

“It wasn’t the co-housing, but now that I’m here, I really like it,” says Cabrera.

Some residents were not that interested in the concepts behind the project at first, so participation has grown organically, she says.

Like other LIHTC deals

Petaluma Avenue Homes comes after McCamant & Durrett designed a co-housing project in nearby Cotati that raised interest in the model.

Residents have the opportunity to enjoy group meals and other activities in the large community house.

Photo: Treve Johnson Photography

AHA and the architects, who had teamed on an affordable housing project for seniors in Berkeley, proposed a plan for a site in Sebastopol, marrying co-housing and affordable housing. The project is the first affordable rental community in town in about 10 years.

The development uses $10.9 million in tax credit equity from Hudson Housing Capital. It acts like any other LIHTC project for the investor, according to Friedland.

Silicon Valley Bank provided an $11 million construction loan and a $1.6 million permanent loan. The Federal Home Loan Bank also provided a $270,000 Affordable Housing Program grant through Silicon Valley Bank, which also provided a letter of credit that the developers needed.

“Sebastopol’s Petaluma Avenue Homes is truly a special project because it brings the concept of community that is unique to a co-housing project to lowincome renters, who would otherwise not have the opportunity to live in a co-housing model,” says Christine Carr, manager of community development fi- nance at Silicon Valley Bank.

The city of Sebastopol Community Development Agency provided $2.8 million, and the Sonoma County Community Development Commission provided $495,000 in Community Development Block Grant and HOME funds. Enterprise contributed a $40,000 green grant.

AHA is leaving the door open to doing another co-housing project. Sebastopol leaders really wanted it, and similar support will be important for any future projects, says Friedland.

In the meantime, AHA has learned several lessons from Petaluma Avenue Homes. One is how careful and conscious design decisions can really facilitate community building, says Friedland, pointing to the development’s walkable environment and other features.

That knowledge will influence all of the group’s developments down the road.