Enterprise Community Development and nonprofit operator Fellowship Square Foundation collaborated on an innovative site planning and financing strategy to create a brand-new community for seniors 62 and older in Reston, Virginia.
The aging Lake Anne Fellowship House—one of the first senior affordable housing communities built in the 1970s in Northern Virginia—had been in need of a substantial rehab; however, the upkeep and maintenance costs in recent years far exceeded the amount the seniors paid in rent and the subsidies received.
Rather than disrupting and relocating the older residents during a lengthy rehab, Enterprise Community Development and Fellowship Square Foundation decided to build a new eight-story modern building on an underutilized portion of the property.
To help finance the new development, the team was able to monetize the value of the land owned by Fellowship Square Foundation where the original building stood by selling it to a national home builder for future townhomes and utilizing those proceeds to repay a construction bridge loan.
“Our partnership with Fellowship Square Foundation brought fresh thinking and an innovative approach to the development of Lake Anne House, a modern senior community featuring improved accessibility and a range of amenities,” says Matt Engel, senior director, real estate development, at Enterprise Community Development. “By focusing on an underutilized portion of the property, we were able to construct a new 240-unit, energy-efficient affordable housing senior community that minimized disruption to the existing residents.”
Lake Anne House has been selected the overall winner in Affordable Housing Finance’s annual Readers’ Choice Awards. Magazine and newsletter subscribers also voted the project as the top development in the seniors housing category.
Engel says creating a new building gave the partners the opportunity to design something from scratch that would meet the populations’ needs. Designed by Grimm + Parker Architects, the steel and concrete building also isn’t typical for affordable housing. However, according to Engel, the option to go vertical was necessary since there was limited space on the site to spread out. The state-of-the-art building also boasts energy efficiency, which is an upgrade from the old building. Lake Anne House is EarthCraft and Energy Star certified.
All units are universally designed—with grab bars, lower workspaces, and task lighting—to allow residents to age in place. In addition, 54 units are fully handicapped-accessible.
The team also worked closely with the culturally diverse population of residents moving from the old building to understand what they wanted in their new home. As a result, the amenities include a fitness center; an arts and crafts room; a game room; a social hall; an outdoor terrace; a wellness clinic for visiting medical professionals, and even a space for pingpong, which is popular with many of the senior residents. In addition, the building includes bike storage and electric car charging stations.
Living in one of the most expensive ZIP codes in the state, residents are able to remain in the community. All of the units serve seniors with incomes at or below 60% of the area median income. Residents—many of whom live on Social Security or Supplemental Security Income alone with an average income between $10,000 and $15,000—pay no more than 30% of their income toward their housing costs, including rent and a utility allowance. To achieve this, the team worked with the Department of Housing and Urban Development as well as Fairfax County to transfer the project-based operating contracts from the old building.
In addition to the land proceeds, the $86.5 million development was financed with 4% low-income housing tax credit equity provided by Capital One through Enterprise Housing Credit Investments and tax-exempt bonds from Virginia Housing. Fellowship Square Foundation provided a seller note. In addition, financing sources included Fairfax County Redevelopment and Housing Authority, Virginia Department of Housing and Community Development, and deferred developer fee.
“This state-of-the-art building in Reston allows our residents to age in place in Northern Virginia where housing insecurity is a growing issue for low-income seniors. We are thrilled to receive this recognition and proud that the readers of Affordable Housing Finance recognized the innovation, collaboration, and determination that went into the development of this community,” says Christine Madigan, interim president of Enterprise Community Development and executive vice president and chief business officer of Enterprise's Community Development division.
AHF’s Readers’ Choice winners will be celebrated at the annual AHF Live conference, Nov. 13 to 15, in Chicago.