Houston -- Unlike other big cities, Houston has never had much of a history when it comes to single-room occupancy (SRO) developments. That is until New Hope Housing, Inc., came along.
The emerging nonprofit is pioneering a new type of housing in Houston and doing it without carrying debt. The most recent example of New Hope Housing’s work is its $6.1 million Canal Street Apartments, a debt-free project that is helping to fill an important need in the city.
Inside Houston’s Loop, there are at least 5,000 people who are living alone and whose incomes meet the group’s target range, said Joy Horak-Brown, executive director of New Hope Housing.
That’s why the group, which boasts 319 units in three developments, continues to concentrate on developing SRO projects.
Although there are transitional housing projects in Houston, the concept of permanent SRO housing has been late in arriving. There are several possible reasons for this, according to Horak-Brown. First, she cites how the Houston economy was booming in the 1970s and for most of the 1980s. Historically, housing has also been very affordable in the area. As a result, the concept of SRO housing, while familiar on the East and West coasts, did not receive the same notice in Texas.
The need, however, was identified by members of Christ Church Cathedral-Episcopal, a longtime downtown Houston church with a tradition of social service.
New Hope Housing was founded in 1993 as an independent nonprofit. Although it is not affiliated with the church, the group’s initial vision came from members of the Christ Church Cathedral-Episcopal. The congregation, with the help of Houston foundations, helped launch the housing group by raising $1.25 million in seed money.
Two years later, the organization opened its Hamilton Street Residence. The 129-unit project, which has been expanded twice to meet demand, was developed in a neighborhood that was rundown at the time, but it now sits just 100 feet away from the new Minute Maid Park, home of the Houston Astros.
New Hope Housing’s second project involved the acquisition of a 57-unit Sec. 8 SRO property.
Canal Street Apartments, which opened at the end of 2005, is the group’s latest and largest effort. Located in the Second Ward, one of Houston’s oldest neighborhoods, the project has 133 units, including 34 apartments for residents with special needs.
To build support for the new project, officials hosted a series of introductory lunches to meet with community members and let them tour the existing developments. New Hope Housing also hired Houston-based architect Val Glitsch to design the project. She came up with three schemes to provide the community with different options. The final 41,000-square-foot project is the design that Glitsch and the neighborhood liked the most.
“The design started with looking at the neighborhood,” she said. “The neighborhood is all one- and two-story buildings close to the street.”
To make the apartments suit the surroundings, Glitsch created a two-part building – one section is two stories, and the other is three stories. Plenty of glass is used in the design to offer views of a courtyard and to create an open, transparent feeling, she said.
The project fits into the style of the old neighborhood while updating it with modern touches.
The efficiency apartments are furnished with a bed and desk. They also come with a small refrigerator, microwave and a private tiled bath. Horak-Brown describes the apartments as “idealized college dorm rooms.”
The project also has two community kitchens and other communal space.
New Hope Housing’s apartments rent for about $340 per month, including utilities. At Canal Street, 120 units are aimed at residents earning no more than 50% of the area median income (AMI), and 13 units for individuals earning no more than 65% of AMI. Most residents, however, earn about 30% of AMI, which is about $10,800 per year.
Residents include the working poor, veterans, victims of domestic violence, disabled people, and individuals recovering from substance abuse.
The organization has an on-site case manager. New Hope Housing doesn’t offer social services itself, but officials help refer residents to service providers if needed.
Built without debt
One of the most unique aspects of the development is that it was built without debt. “We can’t carry debt,” said Horak-Brown. “We raise charitable dollars to build these buildings. Once they are built, they are self-supporting.”
Almost half of the financing came from government sources, including the city of Houston, which provided $1.5 million in HOME funds, and the Texas Department of Housing and Community Affairs (TDHCA), which provided another $1.5 million in HOME funds and a $50,000 housing trust fund grant.
Canal Street Apartments also received a $500,000 Affordable Housing Program grant from the Federal Home Loan Bank of Atlanta through Compass Bank. Enterprise also provided a $14,000 grant for “capacity building.” Foundations and corporations came through with the rest of the financing.
The apartments are assisting a population that is very difficult to serve, said Edwina Carrington, former TDHCA executive director who attended the grand opening. She cited the project’s aesthetically pleasing design and the fact that it was developed without debt. When a development charges such low rents, it’s not able to make debt service, Carrington said.
Several moves helped the organization make the deal work. First, New Hope Housing purchased the land at a good time, paying $4 per square foot in 2001. Prices in the Second Ward have risen to about $12 per square foot.
The nonprofit then hired Camden Builders, Inc., a subsidiary of Camden, a large Houston-based real estate developer, which helped ensure that the project was built on budget and on time.
Canal Street Apart-ments also used simple, durable building materials, including concrete block. Officials, however, carefully chose colors that would provide style and make materials appealing. The development team also eliminated unnecessary elements, including cabinets in the two community kitchens because residents were going to use their own utensils from their units.
The group, however, spent money in key areas, including a 50-year roof and stucco for the building, so it would fit into the neighborhood.
All of New Hope Housing’s projects are located close together to help the organization achieve operating efficiencies, according to Horak-Brown. New Hope Housing has a small staff of three full-time employees in its main office plus about 20 people at the properties.
The organization is looking to develop another 1,000 units of SRO housing in and around downtown Houston over the next several years. Leaders are seeking a site for the group’s fourth project.
“We have developed an expertise,” Horak-Brown said. “We feel we should stay with what we do best.”