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SSC2011_Aaron Miripol PPT




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  • Exercise after this: Visioning in small groups – what would a land banking project look like in Madison? 20 min small group, 10 min large group discussion
  • Aaron – here is where you plan to talk about generating income during the holding period and also why land banking is not the same as land prospecting
  • I’m still not sure where this goes

SSC2011_Aaron Miripol PPT SSC2011_Aaron Miripol PPT Presentation Transcript

  • Solutions for Sustainable Communities Preserving Affordable Housing Near Transit Washington, D.C. September 26, 2011 Aaron Miripol Denver, Colorado www.urbanlandc.org
    • 501(c)(3) nonprofit, supporting organization to the Denver Community Foundation.
    • Mission: To acquire, develop, and preserve community assets in Metro Denver
    • Promote community development; strengthen neighborhoods through preservation of key real estate
    • Preserve real estate in existing or emerging neighborhoods to ensure their continued public benefit
    • Acquire strategic properties in anticipation of market changes through land banking along transit corridors
    • When possible use 99 year land lease to ensure stewardship of land
    • Over the last 5 Years: $22 million invested in 14 properties, serving 10,000 people
    • Leverages an additional $47 million in real estate redevelopment with its partners
    • 400 full and part-time jobs are supported by ULC’s real estate investments
    About Urban Land Conservancy (ULC)
  • Make-Up of Denver & Metro Area
    • 600,000 residents 1.7 million residents
    • 274,500 homes 861,000 homes
    • 23,600 restricted affordable 21,500 restricted affordable
    • 8.6% of all homes restricted 2.5% of all homes restricted
    • Land locked Most cities can continue to annex county land
    • Denver is a City and a County 6 Counties with 54 cities
    • “ Strong Mayor” political system Strong City Managers
  • Opportunities during difficult economic times; TOD Fund for Metro Denver
    • Build out of FasTracks over the next decade
    • - Currently 40 miles of light rail track and 36 stations are in operation
    • - Passage of FasTracks: 120 miles of track (5 new lines) and 60 new stations in Metro Denver to be built
    • Demand for housing within ½ mile of light rail stations will grow from 45,000 households today to 155,000 households in 2030, a 344% increase .[1]
    • - 40% of this growth is projected to come from low income households, at or below 80% AMI
    • ($57,450 for a family of four)
    • - Up to 44,000 additional affordable homes will be needed
    • Today there is an over supply of raw ground and industrial space along transit
    Opportunities for the TOD Fund for Metro Denver [1] Source : Enterprise Community Partners, “The Case for Mixed-Income Transit-Oriented Development in the Denver Region,” March 2007.
  • ULC Real Estate Investments
    • Finance land and property acquisition
    • Create or preserve over 1,000 affordable homes over the next 10 years
    • - 60% AMI and below for rental, 95% AMI ownership
      • - Goal of 15% of all homes for extremely low-income (30% AMI)
    • Provides patient, high-risk capital at low cost
    • - 90% Loan to Value at 3.5%
    • Purchase and hold sites for up to 5 years
    How the $15 million TOD Fund works
  • How the Fund works (cont…)
    • ULC: 10% investor and sole borrower
    • Enterprise Community Partners: Assemble loan capital; Fund manager; largest investor
    • City of Denver: Top loss funding of $2.5 million
    • MacArthur Foundation Housing Preservation Award: $2 million PRI and $250,000 grant for early warning system
    • Total of 9 investors in the $15 million TOD Fund
  • TOD Fund Waterfall Position Organization Amount/ Rate Equity Urban Land Conservancy $1.5 million /0% First Loss City of Denver $2.5 million/0% Second Loss Enterprise Community Partners $1 million/ 2% Third Loss Mac Arthur Foundation $2 million/ PRI 2% Third Loss CHFA $2 million/ 2% Third Loss Rose Community Foundation $500,000/ 2% Senior Debt Mile High Community Loan Fund $500,000/4% Senior Debt Enterprise Community Loan Fund (with Wells Fargo and US Bank) $5 million / 6.5% TOTAL $ 15 Million/ 3.5%
  • Economics of Affordable Housing on the West Corridor
    • The West Corridor will add roughly 15,000 homes by 2030
      • - If only 10% or 1,500 of these homes are affordable, it would double the number of affordable homes currently within ½ mile of the West Corridor
    • According to the National Association of Home Builders (NAHB), the economic impact of building these affordable homes would be:
      • First year of construction: $140,488,000 in local income , $12,195,000 in taxes and other revenue for local government, and 1,785 local jobs.
      • Annual, ongoing local impacts: $40,732,000 in local income, $5,609,760 in taxes and other revenue for local government, and 468 local jobs . [2]
    [2] Source: “The Economic Impact of Low Income Housing Tax Credit Development Along Transit Corridors,” NAHB Housing Policy Department, June 2010. Economics of Affordable Housing on the West Corridor
  • The West Line Corridor
  • Jody Apartments
    • Apartments are less than 300 feet from the future Sheridan transit station along the West Corridor, and adjacent to a 800 car park-and-ride to serve the station
    • ULC owns the land and has a 99-year lease with NEWSED (local nonprofit) that owns the improvements.
    • - Four rental buildings serving over 100 residents.
    • 52 of the 62 apartments are permanently affordable, with 12 of the 52 committed to households at 30% AMI and below
    • Total acquisition and rehab: $3.25 million
    • Redevelopment into 150 mixed income apartments & 25,000 sq. ft. of commercial/community space
    • Total Redevelopment Costs: $50 million
    Model for the TOD Fund
    • TOD Fund Acquisitions
    • Yale Commons
    • Purchased in July 2010, this 1.25 acres of land is located next to the Yale Station (below)
    • Land Price= $1.35 million ($25 sq. ft.)
    • Partnering with 2 private developers and RTD to create Master Transit Community plan to include multiple properties and current RTD parking lot. At least 70 affordable apartments
    • Total Development Costs = $14 million
    • Dahlia Apartments
    • Dahlia (above) was purchased out of foreclose in in early 2010 for $1.2 million. There are six buildings with thirty-six 2-bedroom apartment in northeast Denver.
    • Dahlia was the first TOD Fund acquisition and includes NSP dollars for rehab. ULC is stabilizing the buildings and will sell the improvements to a nonprofit and continue to own the land with a 99 year lease .
    • Total Acquisition and Rehab: $2 million
    • TOD Fund Acquisitions
    • Delaware Station
    • Purchased in June 2011, this one acre of vacant land sits across the street from the Evan Light Rail Station. ( below)
    • Land Price= $1,150,000 = $26.50 sq. ft.
    • Partnering with Medici Communities in the development of 50 residential workforce housing units utilizing 9% Low Income Housing Tax Credits.
    • Total Development Costs = $12 million
    • Mile High Vista
    • This 2+ acre site ( above) was purchased in March, 2011 and is getting developed to include a new Denver Library, up to 70 units of workforce housing + 10K sq. ft. of community space and a 20K sq. ft. commercial building.
    • Land Price = $2,140,000 = $23 sq. ft.
    • This development along the West Corridor will serve as a catalytic development for West Colfax in Denver – the nation’s longest street.
    • Total Development Costs: = $35 million
    Mile High Vista
    • TOD Fund Acquisitions
    • Villa TOD
    • 1/3 acre mixed use property was purchased in August, 2011 and sits on the Santa Fe bus corridor and is 5 blocks from 10 th & Osage light rail station.
    • Property includes 16 existing affordable apartments and 7,500 sq. ft. of commercial space. ULC will partner with two local nonprofits, NEWSED and Denver Inner City Parish on the long term redevelopment with a 99 year land lease.
    • Total Acquisition and Rehab Costs = $2.3 million
    • TOD Fund to Date: In 16 months of existence, half the fund has been deployed, preserving and developing nearly 250 affordable homes
  • Future of TOD Fund
    • Expand to $30 million by 2012 (regional fund) and add over 1,500 affordable homes by 2021
    • Investments from other local municipalities besides Denver
    • New enabling legislation allows RTD to partner with for profit and nonprofit developers at transit stations
    • Over $150 million of investments will be leveraged by the Fund and more than 2,200 jobs created
    • Getting beyond silo solutions: Fund is more than affordable housing, as it brings other development opportunities and economic investment to under served transit sites
  • Benefits and Challenges of TOD Fund
    • Preserves land and buildings around transit corridors to ensure long term affordable housing & stewardship of the land
    • Gives affordable housing developers a financing tool to help mitigate real estate risk at transit sites
    • Encourages partnerships with CDCs and other developers
    • Balances redevelopment efforts along transit
    • Increase residential and commercial density = smart growth
    • Provides employers with access to an expanded workforce
    • Increases ridership on public transit
    Benefits of TOD Fund
  • Challenges of TOD Fund
      • Added layers of complexity
      • Loss of development control with partners
      • Stiff competition for LIHTC (key for take out)
      • Priced out of existing multi-family housing market
      • Lack of revenue generating properties
      • Glut of land banking opportunities
      • Need for longer loan term, up to 10 years
      • Need for additional equity beyond ULC’s investment