How Much Affordable Housing Is Too Much? | Worcester bristles at low-cost apartment developments in downtown
Rendering/Courtesy
A rendering of the planned Canal Lofts development in Worcester's Canal District. This is one of two so-called affordable projects Boston-based WinnDevelopment has planned in the city.
The latest mess involving the prospective development of significant properties in Worcester can be summed up as a competition between two well-worn clichés. On one side is “grabbing defeat from the jaws of victory.” On the other is “sacrificing the good on the altar of the perfect.”
The first is embodied, and was uttered by, Konstantina Lukes, former mayor of Worcester and currently a city councilor.
She thinks that by allowing two residential developments proposed for Worcester by WinnDevelopment of Boston, Worcester will “grab defeat from the jaws of victory.”
Winn has proposed to refurbish the 95,000-square-foot Chevalier furniture building along Interstate 290 in the city’s Canal District into 64 units of housing, 50 percent of which would be considered “affordable.”
Winn is also working with the Worcester Business Development Corp. on a plan to refurbish a former Worcester Vocational School building also known as the Boys Club at 16 Salisbury St. near Lincoln Square into 82 units of housing, 40 percent of which would be deemed “affordable.”
Lukes and others on the city council would rather leave the buildings — the former school building is empty and Chevalier is in the process of moving out of its well worn 19th Century mill building — vacant until they’re developed entirely as market-rate housing.
“When you have affordable, you’re restricting who can move in there. Why should we restrict anything? If you’re going to use that tenant, you’re never going to be strong enough,” Lukes said. “In order (for Worcester) to be viable, you have to have the appearance of a successful city.”
Apartments Available
For Winn, Lukes and her allies on the city council are in danger of sacrificing the good on the altar of the perfect.
Winn would open the Canal Lofts in the spring of 2011.
The affordable units would be for tenants that earn between $38,000 and $43,000 a year depending on the size of the household. The largest units will accommodate three people.
Winn has financing in place for the Canal Lofts project. The finished development will include an on-site management office, a fitness center, bicycle storage, on-site parking for every unit and LEED design elements for energy efficiency.
“We saw an opportunity in an area like the Canal District to continue to gentrify and meet the immediate and prospective needs of the area,” said Gilbert Winn, managing principal at Winn, a 2,000-employee firm based in Boston and with projects throughout the eastern seaboard. For the past decade, the firm has focused on historic renovation projects.
In Worcester, the Canal Lofts project and the prospective Boys Club project would both be historic renovations that would take advantage of, and depend upon, state and federal historical tax credits that require a certain proportion of affordable units.
Winn noted that in larger cities the firm works in like Boston, New York, Washington, D.C. and Richmond, Va., a development in which half the housing units are considered affordable isn’t considered an affordable housing development. It certainly is not considered a housing project, a term usually reserved for developments leased entirely by low-income residents supported by federal Section 8 subsidies.
Historic Credit
“To call a 60/40 mix an affordable deal would require more study on what it takes to get the deal financed,” Winn said. “There’s an information gap, and people are sick and tired of ‘projects’ being built in their neighborhoods. I think if (the city council) looked at their constituents, half of them would qualify” for units in the Canal Lofts development.
Projects that don’t take advantage of available tax credits or other development incentives “just don’t get built,” he said.
He explained that rent of $1,200 per month can support development costs of about $100,000 per unit. In Massachusetts, development costs are about $300,000.
“Where does that other $200,000 come from? It comes from subsidies” like historical tax credits and state and federal low income and housing development tax credits, he added. “The ability to combine subsidies allows (developers and property owners) to offer units for different incomes. Around the commonwealth, the vast majority are using public subsidies, and would not be going on right now if they weren’t.”
Lukes said Worcester “is in a political rut” and has “dumped” good, long-term development ideas in favor of short-term fixes, which is what she considers the development of affordable housing.
Keeping Winn from developing what she called “a housing project” at either site would leave open the opportunity for “a private developer willing to invest their own money” to take on those and other sites.
Then, “in 10 or 20 years from now, we’re talking about finally doing something for downtown Worcester.”
Winn and other developers, Lukes and other councilors argue, are simply grabbing for state and federal money set aside for affordable housing development.
But Winn has a pretty good track record, especially with historic renovations. Last year, the Boston Preservation Alliance gave Winn the 2009 Preservation Award for Adaptive Use of a Historic Industrial Space for the firm’s historic preservation efforts at Dorchester’s Baker Square. The firm also renovated what is now known as the Apartments at Boott Mills inside the Lowell National Historic Park.
“We’re creating housing and removing blight in places where you don’t walk by a vacant building and say, ‘that’s nice,’ you walk by and say, ‘that’s terrible,’” said Winn.
Allen Fletcher, head of the Canal District Alliance, agrees.
“Overall, the plan they have down here in the Canal District, the Canal District Alliance supported wholeheartedly,” Fletcher said. Affordable housing “doesn’t mean there’s Section 8. It could be my children. It could be anybody. We think residential tenancy is really needed down in the Canal District. The fact that they’re proposing to renovate an old building and get 65 units of housing down there is what we want, period. The larger issue is whether Worcester is shooting itself in the foot by not going for more upscale tenancy, and I’m not sure about that.”
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