Rehabbing existing properties and building more rural and workforce housing have become prime concerns of developers in Texas and other South Central states. In Texas, a state Senate bill has spurred a serious dialogue about affordable housing in the state. The hope is that the largescale housing bill that was passed will compel state legislatures in the rest of the country to discuss affordable housing issues.

The rehab trend

Kansas developers are focusing more on historic rehabilitation than ever.

“We have a historic state tax credit in Kansas so there has been a trend towards doing more historic rehabs,” said Fred Bentley, rental housing director with Kansas Housing Resources Corp. “There’s just so much more equity to work with— you’ve got the federal and state historic tax credits. These historic rehabs tend to be more expensive [than new construction projects], but they’re easier to finance.” A number of developers of Sec. 8 properties have received funding to refurbish units, said Bentley.

Kansas should witness more scattered site developments in rural areas being redeveloped and restructured, said Bentley.

“We are a state of small communities and fixing up existing housing is a lot more cost-effective than building something new, so we are trying to do more of that,” said Bentley. “I don’t doubt we’ll be looking at more of those types of developments as we go forward.”

Historic rehabilitation in Missouri is spreading like wildfire (like Kansas, state historic tax credits are available here). Among the most notable developers is Dale Schulte, who started work earlier this year at Star Lofts in downtown Kansas City, Mo. He is converting the former Hesse Carriage Company building into 46 affordable units for residents earning no more than 60 percent of the area median income. The project will be Schulte’s 13th historic rehabilitation project, and he plans to do more.

Rural, workforce housing are top concerns

Preserving affordable housing in Department of Housing and Urban Development and United States Department of Agriculture Rural Development properties is a major priority in Missouri, said Pete Ramsel, new executive director with the Missouri Housing Development Commission (MHDC).

Developers submitted 114 proposals for affordable housing developments in Missouri in 2007. MHDC awarded $43.9 million to 39 projects, representing a total of 1,335 units, in 2007. The funds included state and federal tax credits, federal HOME loan funds, and MHDC Fund Balance Loans. Most of the developments (11 of which are seniors housing) already have broken ground or are under construction, said Ramsel. The agency has held public hearings on its 2008 Qualified Action Plan (QAP) for its tax credit reservation process. Upon approval of the QAP in August, MHDC will publish its Notice of Funding Availability and begin accepting applications. The agency will determine winners of 2008 funding in December.

Affordable housing across the state is filling up fast, particularly in Branson, Mo., where 2,500 new jobs have been created in the past two years thanks to the development of more casinos and entertainment venues. This town of about 7,000 residents is suffering from a lack of workforce housing. Many commute to Branson from Springfield, Mo., and nearby Arkansas towns to work. HCW, LLC just completed Phase I of Country Ridge Residences, an affordable housing development, to meet the increased demand for housing in Branson. All 60 units were leased immediately. Construction of a 40- unit second phase began in August. At press time, 78 people were on the waiting list for Phase II. “I’m hoping for a Phase Three,” said Shanna Tilley, Country Ridge Residence’s property manager. “It has been discussed.”

Talk in Texas

This spring, Texas lawmakers passed Senate Bill 1908, a comprehensive housing bill that touches on several aspects of housing issues in the state. One of the key provisions is the penalties to be levied against affordable apartment owners whose properties have serious and ongoing instances of noncompliance. “It was the first time in recent memory that politicians in Texas were talking about the continuum of housing, from homelessness to education to tax-credit units to marketrate units to homeownership,” said Michael Gerber, executive director of the Texas Department of Housing and Community Affairs. “I’m talking about working to develop a clear housing policy. We didn’t get there with 1908, but it’s remarkable that it spurred a lot of talk.” The State of Affordable Housing in Texas for an in-depth chat with Gerber.)

Gerber said he is hopeful that the dialogue in the Texas legislature will inspire other states to more fully address their housing issues.