HomeMy WebLinkAbout01-12-12 materials for CAHAB meeting, Farmhouse Partners summary FARMHOUSE PARTNERS LIMITED PARTNERSHIP
2555 W. COLLEGE, SUITE B '
BOZEMAN, MT 59718
TELEPHONE:406-585-9808 FAX: 406-586-1166
E-MAIL farmthouscL)brid�eband,coni
December 21, 2011
Ms. Tracy Menuez
Community Development
HRDC
32 So. Tracy
Bozeman, MT 59715
Dear Tracy:
As we discussed, the purpose of this letter is to request that the HRDC and CAHAB write a letter
to the Montana Board of Housing supporting the development of a proposed 11-unit affordable
apartment complex which will be financed and operated under the guidelines of the Low Income
Housing Tax Credit Program. For the developer to receive credit for community support, the
letter needs to provide more than generic support for affordable housing. The letter will be
submitted as part of the developer's application for financing at the end of the second week in
.January, 2012.
Project Details:
Sponsorship: Farmhouse Partners, one of Montana's largest developers of affordable
apartments, and HAVEN, a 501(c)3 non-profit organization, are undertaking the development of
the Haggerty Lane Apartments on Haggerty Lane, roughly 200 yards southeast of the Comstock
Apartments, an existing 86-unit affordable apartment complex also owned in part and operated
by Farmhouse Partners.
Long-Term Affordability: 100% of Haggerty Lane Apartments' proposed units will be leased
to households earning less than 60% of area median household income. Two-thirds of those units
will be leased to households earning less than 50% of area median income. One unit will be
leased to households earning less than 40% of area median income. The complex will be
operated as an affordable rental property for a minimum of 46 years. The developers of the
property will not be seeking a property tax exemption.
Project Profile/Rents: The proposed complex will consist of three 2-story buildings containing
10 2-bedroom and 1 1-bedroom units. With completion expected in the early summer of 2013,
the complex's 2-bedroom units are scheduled to lease for $585-6051 month plus utilities, and the
single 1-bedroom unit is projected to rent for $420/month plus utilities. These rents are not only
substantially below market rents, but are also well below the maximum rents allowed under the
tax credit housing program.
Why 2-Bedroom Units? Farmhouse Partners and its affiliate, Alliance Property Management,
currently own or manage a total of 310 affordable apartments in Bozeman and Belgrade. The
developer has elected to build predominantly 2-bedroom apartment units at the proposed
property, because based on Farmhouse' experience, the highest demand for affordable It
apartments is consistently for 2-bedroom units which are targeted at low- and moderate-income
households of between 2 and 4 people. The country's largest and fastest-growing demographic
segment is households of two or less people.
Project and Unit Amenities; The project's residents will have access to landscaped park areas,
picnic tables and sheltered bicycle storage areas. Each building will have coin-operated washer/
dryer units on the ground floor. Each unit will include an energy-efficient refrigerator,
dishwasher, range and disposal. Unit heating will be provided by individually controlled and
metered gas-fired hot water baseboard heating systems. Concrete sub-floors in the second floor
apartment units will help to minimize noise transference to first floor units.
201 I's Tight Reutal Market: Since June, 2011, the average occupancy rate for the 310
affordable apartments in the area either owned or managed by Farmhouse Partners and Alliance
Property Management has been in excess of 97%. As area home values have collapsed, demand
for rentals has increased. Beginning in 2011, the tight rental market has begun driving up area
rents, making rental housing less affordable, especially for low- and moderate-income tenants.
With very few new rental units being constructed, the upward pressure on rents can be expected
to continue.
Rental Market Summary (2009-2011): Please find attached a summary of conditions in the
area rental market from the fall of 2009 to the present. The data in the summary has been
compiled by Alliance Property Management, a Bozeman-based property management firm
which currently manages approximately 500 rental units.
Project Design: Haggerty Lane Apartments will feature small four-plex buildings whose scale is
not much larger than a single-family detached home. The buildings' scale and low density are
designed to provide the complex's residents with a stronger sense of individual identity than is
often the case with larger, affordable multi-family complexes. The small size and architectural
design of the buildings are intended to make them visually compatible with the cottage-style
architecture of the five single-family homes situated to the west of the apartment complex.
Farmhouse Partners' affordable apartment properties have been past recipients of design awards,
including one from the Bozeman Beautification Advisory Council. Haggerty Lane Apartments
will be an attractive, well-landscaped property that will be an asset to the neighborhood and
make its residents proud to live there.
In summary, Haggerty Lane Apartments will provide a needed addition to the city's inventory of
rental units with guaranteed long-term affordability. We hope that the HRDC and CAHAB will
support the development of this project.
Sincerely,
William C. Dabney III
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