Photo Illustration by Maxine Mills and Skillet Gilmore
A mixed-use, mixed-income housing project next to the Durham Station Transportation Center is moving forward—though it’s unclear how exactly the developers will be able to meet all of the city’s goals and still make the development viable. On Thursday, the Durham City Council voted to move ahead with DHIC Inc. and Self-Help Ventures’ proposal, the only one the city received for the project.
In September 2015 the city decided the site should be used for a mix of commercial and housing units, with 80 percent of the apartments set aside for tenants earning less than 60 percent of Durham’s median income, $52,106. It then sought proposals from qualified developers to make that happen.
The next step will be for Self-Help, DHIC, and architect Klein Design Associates to develop some options for how the property will look, from the number of apartments to where parking will be located. There is no concrete timetable at this point, says deputy city manager Keith Chadwell, although the city is aiming to have a design completed in time to apply for low-income housing tax credits, applications for which are due in January 2018. How the project will be financed also depends on the final design, Chadwell says.
“I, for one, think the two things the city can bring to the issue of needing to provide affordable housing are funding and land,” council member Don Moffitt said during Thursday’s meeting. “This is a very valuable piece of land, and I think it should be used to further those goals.”
The proposal from Self-Help and DHIC received just 39.5 out of 100 possible points on a city scoring matrix, but council members did not seem deterred by that. Points were lost mostly because of the developers’ inexperience with commercial spaces and the scope of their previous projects. DHIC operates thirty-nine affordable housing communities, but nothing approaching this size.
City staff sought some expert opinions on why there weren’t more proposals from developers.
“As the [request for qualifications] was forwarded to the top 50 affordable housing developers in the United States … staff anticipated more than one response to the RFQ,” a city memo says. “As a result, [Department of Community Development] staff reached out to members of the affordable development community in an effort to determine why there was only minimal interest.”
Three developers and city staffers, according to the memo, found several obstacles to completing the project, mostly dealing with conflicts between the demands of market-rate housing and the requirements of subsidized housing. For one, the project is “not consistent with typical tax credit applications submitted to the North Carolina Housing Finance Agency.” Retail isn’t normally included in affordable housing projects. Ditto for parking structures. And without amenities, like a pool, market-rate renters may not buy in to the arrangement. Lastly, the wonky shape of the lot and noise and other environmental factors from the adjacent transportation center could make the project costly.
Natalie Britt, vice president of real estate development from DHIC, acknowledged that meeting all of the city’s goals will be a challenge. “We’ve done some pretty complicated projects,” she said. “ … We feel like this is something that’s really important to us because we are locally based and we’d love to do it, but it’s going to be complicated.”
“Members of Durham CAN have been involved with this project since its inception,” the Reverend Herb Davis, cochair of Durham CAN, said in a statement. “We have flexed our people’s muscle multiple times to ensure downtown Durham is diverse and affordable to families. It is only logical we weigh in one more time, and offer our position on the alternatives to be discussed.”
The city already has one example of mixed-income housing as part of the Southside Revitalization Project. That development currently does not have commercial space but is set up to have it in the future, says city manager Thomas Bonfield.
Self-Help Ventures Fund is part of the Self-Help Credit Union, which lends to individuals, businesses and nonprofits and has “developed and invested $144 million in commercial real estate projects to invigorate downtown areas and neighborhoods” and “created affordable housing for 228 families,” according to its website.
Herald Sun – Affordable housing advocates make their case for project near Durham Station
VIRGINIA BRIDGES, email@example.com; 919-829-8924
DURHAM — Members of Durham Congregations Associations and Neighborhoods (Durham CAN) called on city leaders Tuesday to move forward with a plan for affordable housing on city property next to the downtown bus hub.
Since 2000, development representing more than $1.3 billion of public and private investment has been built or started in downtown Durham, said Herbert Davis, senior pastor at Nehemiah Christian Church downtown.
“But not one home has been added there for low-income workers and transit users,” Davis said.
The Durham CAN press conference at Monument of Faith Church came as the City Council plans to consider Thursday whether to allow a joint-venture to build affordable housing on a 1.9 acre, L-shaped lot next to the Durham Station Transportation Center at Jackson and Willard streets.
City Manager Tom Bonfield wants the City Council to confirm it wants to move forward, considering that only one proposal was submitted and other firms have expressed interest in developing on the site.
The city sought qualifications from interested developers last year for a mixed-use proposal with 80 percent of the housing units going to families making less than 60 percent of the area median income.
The city heard from one joint venture between Durham-based Self-Help Ventures Fund and Raleigh-based affordable housing developer DHIC. A city evaluation team gave the venture 39.5 out of a possible 100 points.
Self-Help and DHIC are two national known leaders in community development, said Selina Mack, executive director of nonprofit Durham Community Land Trustees.
Self-Help has financed and renovated, redeveloped key projects across the Bull City and Greensboro, she said at Tuesday’s press conference. DHIC is the Triangle’s most experienced affordable housing builder, she said
The city’s request for qualifications was forwarded to the top 50 affordable housing developers in the U.S. The city also advertised in other publications. Feedback indicated that the site’s location, size and shape presented financing and development challenges.
But Durham CAN representatives said the joint-venture partners are local and proven.
“They are aware of the challenges, they are not coming in blind, and they see potential,” Davis said.
The city has three options:
It can evaluate the Self-Help-DHIC proposal further and draft a pre-development agreement.
It can remove the affordable housing requirement from the request for qualifications and seek additional responses for a residential development
It can seek mixed-use proposals for the sale of the property at its $2.9 million market value and possibly use that money for an affordable housing on a less complex site.
Councilman Steve Schewel supports the current proposal.
“We all know Self-Help’s ability to get difficult construction projects done here in Durham,” Schewel wrote in an email to the council. “And DHIC is, to my knowledge, the pre-eminent affordable housing developer in the state of North Carolina with many successful, complicated projects under its belt. I think this is a great partnership that can serve us well.”