When California dissolved its redevelopment agencies (RDAs), developer Community HousingWorks had to look at its business plan and rethink how it would grow.
The San Diego nonprofit made a strategic decision to pursue acquisitions as part of its multifamily line of business in addition to its new construction, transit-oriented affordable housing projects.
“It’s very important to keep a balance there. There needs to be a healthy balance of new projects that won’t need attention physically for the next 15 to 20 years and acquisitions that have different needs,” says Anne B. Wilson, senior vice president of housing and real estate finance. “In spite of the loss of the RDAs, we can keep that balance.”
Its multifamily division executed on that balance in 2014. It acquired its largest single community with 200 apartments, acquired and rehabilitated an 88-unit project, and broke ground on two 9% low-income housing tax credit developments.
“We have been building that up for a couple of years, but it takes time to get your foot into the acquisitions market,” says Wilson. “I think we’ve been very successful of making acquisitions and competing in that marketplace.”
The coming year also will see more of that combination of work. The nonprofit plans to celebrate the completion of two new construction projects and close the financing and start renovations on 448 units in five projects.
The 1970s-era Cypress Cove Apartments, the 200-unit project it acquired last year, is slated to undergo a significant rehab this year with the help of tax credits and tax-exempt bonds.
“We are really excited to rehab the project and extend its life for affordable housing for another 50-plus years,” says Dave Gatzke, vice president of acquisitions.
One of its new construction developments that is expected to be completed by July 1 is the 68-unit North Santa Fe Apartments in Vista, Calif. The apartments will be for families earning 30% to 60% of the area median income, with 10 units set aside for youths aging out of the foster care system.
“As a principle, CHW likes to set aside a portion of our homes to help serve special-needs groups,” says Wilson.
To continue that mission, the nonprofit recently received unanimous approval from the city of San Diego Planning Commission and City Council for its proposed affordable seniors housing development that will provide a supportive environment for lesbian, gay, bisexual, and transgender older adults.
This project will be the first of its kind in San Diego and one of the first in the nation. “A lot of studies have indicated that the first generation of LGBT are now seniors who have lost family connections,” says Wilson. “It will be open to everyone, but it’s a special population target, and we’re really proud of being part of that effort.”
The nonprofit is working with the San Diego LGBT Community Center to design the project, which isn’t expected to break ground until 2016. It will feature a 76-unit seniors building and a 118-unit multifamily building in the city’s North Park neighborhood.
This development also uses an affordable housing density bonus, which requires the provision of affordable housing in market-rate development to help make the affordable housing feasible.
“I’m thrilled that this mixed-income approach allows us to bring both high-quality market-rate development to North Park and offset the gap in funding we have in building affordable housing,” says Gatzke.
Regardless if a development is new construction or acq-rehab, the nonprofit puts its residents first. Last year, it launched its Rental Home Stability Program pilot to help low-income families achieve financial security and prevent eviction.
CHW’s property management partner identifies families at risk of eviction and offers flexible payment plans and other financial supports. Forty-four households potentially facing eviction entered the program in the first year, with 75% staying in their homes, 11% moving, and only 14% being evicted. This has resulted in an estimated savings of more than $150,000.
“It’s the best thing for people and the properties,” Wilson says. “A great number of people with a helping hand can stay in their housing.”
