SEATTLE—The Claremont Apartments serves working individuals and families who need but miss out on qualifying for other affordable housing. The new 68-unit mixed-use development was built for residents earning up to 80 percent of the area median income (AMI).
“That's the market that is being missed,” says Earl Richardson, executive director of SouthEast Effective Development (SEED), a Seattle-based community development corporation. “The group between 80 percent and 100 percent of the AMI is being pushed out of the market."
These households fall between the cracks. They earn too much to qualify for most affordable housing developments, which are capped at 60 percent of the AMI, but they don't earn enough to comfortably afford a market-rate apartment.
The Claremont hits the sweet spot in between, with 37 apartments for residents earning up to 80 percent of the AMI. In addition, there are 20 units for those earning no more than 60 percent of the AMI and 11 units for those earning 50 percent of the AMI.
“We've always wanted to hit that market,” Richardson says, explaining that SEED has had to turn away a number of people for its other apartments because they earned slightly above the income limits.
Chubby & Tubby site
The $17.8 million development also fits into Richardson's belief of creating density on major arterials because it gets people on the streets, which then helps businesses and builds a greater sense of community.
The Claremont sits on a notable location— the site of the original Chubby & Tubby, an iconic Seattle store that sold sneakers, jeans, paint, pots and pans, and just about everything else. It was known for the cheap Christmas trees that it sold for just a few dollars because the store wanted everyone to have a tree.
SEED bought the site in 2005 and worked on developing the project during the economic turbulence of the last several years.
“We were honored to be able to purchase it and develop a project that will make a contribution to the neighborhood just as Chubby & Tubby did," Richardson says.
About 14 different funding sources had to be assembled to pay for the project, including $4.2 million in 501(c)(3) bonds through U.S. Bank.
Seattle's Office of Housing and Office of Economic Development (OED) added about $7.2 million in financing. OED provided a federal Sec. 108 loan as well as Brownfields Economic Development Initiative funds. The Sec. 108 program helps finance economic development and housing projects.
The Office of Housing contributed federal HOME funds and proceeds from a voter-approved city housing levy.
“The site was particularly appealing to the Office of Housing because it is well served by public transportation along Rainier Avenue South and is less than a half-mile south from the Mount Baker Sound Transit Light Rail station," says Debbie Thiele, multifamily lending manager at the agency. “There are a variety of commercial services and amenities available within the immediate vicinity of the Claremont."
These services include medical offices, banks, schools, and markets.
The project used a $215,000 American Recovery and Reinvestment Act (ARRA) grant for environmental remediation from the state Department of Commerce. It was the first ARRA grant contract executed by the department for a brownfields project.
Other key financing was provided by the state Housing Trust Fund, Washington State Housing Finance Commission, King County, and the Rainier Valley Community Development Fund.