Affordable housing developers and owners are reaping the benefit for their properties and residents from investing in their broadband infrastructures. Those who understand the advantages of offering their residents broadband access can recognize substantial cost savings during construction – but they can lose those advantages the longer they wait to implement.
Housing finance agencies in 35 states – including Illinois, Kentucky, California, Oregon and Texas – encourage developers through their low-income housing tax credit (LIHTC) allocation process to include high-speed Internet service as a standard amenity for all new construction projects.
Since California adopted a policy of awarding five points for LIHTC applicants that provide free high-speed Internet access to residents, nearly 95% of the state’s tax credit applicants include plans to provide the service.
Making it work for affordable housing
With a broadband Internet connection in the home, people will have more telecommunications choices.
Residents could literally plug into the Internet via the building’s local area network (LAN). Consumers looking for reliable high-speed Internet access may soon be turning to their landlords, instead of the local phone or cable company.
Why? With a high-speed connection and a LAN, property owners can cost-effectively deliver broadband to their common areas, leasing office and individual residences. Owners who understand the value of their telecommunications assets can negotiate better building wiring agreements and exact higher compensation for granting access rights.
Multifamily owners are steadily increasing the number of households that have broadband access. By folding the cost of this technology into their original construction budgets, owners are making broadband access more widely available and at a lower cost per unit.
“Building owners can make a real difference in the market if they understand the opportunities,” says Stel Valavanis, president of onShore, Inc., a Chicago-based network integrator and Internet service provider for developers of affordable and conventional multifamily housing.
The bottom line
Real estate developer Draper + Kramer in Chicago provides free broadband access for the public housing residents of its newly redeveloped HOPE VI project, Lake Park Crescent, a 490-unit mixed-income development offering stunning views of Lake Michigan.
“Investing in our broadband network helps us differentiate our property from others,” says Carl Peterson, vice president of construction services. Draper + Kramer used the data network to provide high-speed Internet service from Verizon Avenue and manage a network of surveillance cameras.
Builders may not have as broad a vision for technology as Peterson, but owners can install a basic LAN in their buildings for about $250 per unit, and they may wish to expand the capacity of that network to handle more broadband-rich applications that can also use the data network.
The cost varies and depends on several factors: building type (new construction or retrofit), number of units, and amount of bandwidth for each connection.
No matter where you are in the development of new construction or retrofit properties, owners can maximize their investment if they take the following steps.
During concept phase
1. Budget for broadband infrastructure. While planning the joint trench for dry utilities, you may consider having one telecommunications closet where all phone, cable television, and data networks terminate. Good technology consultants can guide project managers through the delicate process of dealing with electricity and telecommunications infrastructure for your buildings. You may even want to consider bringing very high-speed fiber to the building for all new construction projects to anticipate future heavy data traffic.
2. Understand your wireless vs. wireline options. Determine which is the most cost-effective way to deliver broadband access to your property. Talk to your technology consultants to learn the security, upkeep and equipment requirements for each option. You could also consider whether to do a hybrid setup, where the units are connected to the Internet by wireline but common areas use wireless for tenants to relax while using mobile devices.
During construction
3. Hire a low-voltage consultant that reports directly to the development team (or a low-voltage subcontractor that reports directly to the general contractor). Electrical subcontractors typically outsource the installation of phone, television and data networks. Control costs by avoiding unnecessary mark-up charges and plan for having a third, independent data network. Hiring a data network engineer minimizes problems during construction and minimizes hidden costs associated with poor design and delivery.
4. Network the units to share broadband. Just like the LAN in your office, consider networking the individual units and computer lab on the same local area network. Doing so gives the developer the opportunity to provide high-speed Internet access for free.
Post construction
5. Organize group training for staff and residents. A technology open house can go a long way toward avoiding problems. Many residents might have never seen a data port and will confuse it for a phone line. Once tenants understand that they can plug their computer into the network and surf the Internet without a modem, they adapt fairly quickly.
6. Move more transactions online. With broadband service at home, tenants can easily view online calendars, pay rent and submit work orders. With broadband in the home, many processes can be streamlined and communication between tenants and owners can be improved. James Sison is a Eureka-Waitt fellow and author of several articles on building housing for the 21st Century. He may be contacted at [email protected] or (773) 454-6465.
