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HomeMy WebLinkAbout017 Affordable Housing Plan NarrativeAffordable Housing Plan Narrative The Boötes Allison Subdivision 4A, Lots 1 & 2 Multi-Family Residential Development We are pleased to submit an Affordable Housing Plan Review application for The Bootes, a residential rental project consisting of rowhomes and apartment homes within the Allison Subdivision 4A. The Bootes is located on the southeast corner of S. 11th Avenue and Opportunity Way. VICINITY The Subject Property is currently zoned R-3, which permits a variety of medium density residential uses. The Bootes will include a variety of rowhomes (40) and several apartment buildings (31 units), as permitted by the Apartment Building, Limited, use-type, under R-3. The rowhomes, located along the site’s perimeter, will be three stories tall, each of which contains four bedrooms and includes a two-car, attached garage. The Apartment Buildings, located within the site’s interior, will include 3 eight-unit buildings, and 1 seven-unit building, each comprised of a mix of two- and three-bedroom flats. The development will also include a 5,500 square foot clubhouse, including a fitness center, work-from-home space, community club room and game room. Outdoor amenities include a spa, grilling area, a community dog park, while also preserving a trail access easement for the community’s benefit. Unit Mix Rental Unit Type COUNT SIZE PER UNIT Two bed flat 23 1,038 Three bed flat 8 1,269 Four bed rowhouse 40 2,587* Total 71 1,937 *Includes 530 SF two-car garage The project will be constructed under a single GMP. Preliminary discussions with the general contractor sequence building completions from west to east with the clubhouse completing with first units. PROJECT TIMELINE An estimated timeline for the project is as follows: • Close on land in early September 2023 • Start construction November 2023 • Clubhouse and first units complete February 2025 • Final project completion May 2025 CONSTRUCTION INFORMATION The project site is currently undeveloped raw land. The project will consist of wood-framed buildings sitting on a slab on grade foundation. Exterior elevations in the drawings highlight a mix of brick, stucco, and fiber cement siding. Below are preliminary renderings of a couple buildings. Parking Unit Count Per Unit Required Total Required Total Provided Apartment Building, Limited 31 1 31 33 surface stalls Rowhouses 40 1 40 80 garage stalls Street Parking - - - 32 - Total 71 - 39 113 Affordable Housing Information As part of this application, we intend to comply with certain sections of Division 38.380 of the Bozeman Unified Development Code and construct affordable homes that meet the standards identified in Table 38.380.020-2 in the same geographically contiguous development as market rate homes. As such, a minimum of 5% of the project’s rowhomes and multi-household dwellings will be available for rent at 80% AMI for 30 years. In exchange, we have applied the following incentives to our project application: • For each single household attached dwelling (townhouse or rowhouse) a minimum lot size of 2,200 square feet, or 1,800 square feet, if the applicant demonstrates that all applicable city regulations related to lot development, access and utilities can be met. • For multi-household dwellings and mixed-use buildings: o Ten percent reduction in lot area for applicable dwelling type in Table 38.320.030.A. o One additional story of height (maximum 15 feet per story) beyond that allowed in the RS, R-1, R-2, R-3, RMH, R-4, R-5, R-O, NEHMU, and B-1 zoning districts. o Minimum vehicle parking requirement of one stall per dwelling for all districts other than B-3 and bicycle parking standards and requirements of 38.540.050 still apply. • In all residential zoning districts for those lots used to satisfy the requirements of division 38.380, not more than 60 percent of the lot area can be covered by principal and accessory buildings. When a larger lot has a portion of its total dwellings subject to the requirements of division 38.380, either directly or inherited from a previous subdivision, the portion used for those dwellings may have up to 60 percent of the lot area covered by principal and accessory buildings. • In compliance with the shallow affordable incentives applied above, four units will be offered at 80% AMI: 1 two-bed flat, 1 three-bed flat, and 2 four-bed rowhomes. The table below shows respective affordable rates calculated from HUD’s 2022 80% AMI values, as found on Bozeman’s Community Housing Program website. Rates will be calculated each year in accordance with the most current HUD 80% AMI values. Locations of the designated units highlighted on the site plan below. (Red: four-bedroom rowhomes, Blue: two-bedroom flat, Orange: three-bedroom flat.) • The Affordable Housing Ordinance, as applied to R-3, further incentivizes the development of Rowhomes over other use types, noting the larger reduction in lot area per dwelling. In programming attached garages, the project’s been designed with this incentive and use-type, in mind, limiting surface parking and increasing the number of rowhomes that would be otherwise permitted. The Apartment, Limited feasibility is challenged by the eight-dwelling units, per building limitation, in addition to the lower reduction in lot area per dwelling. Nonetheless, to create a diverse unit mix, a balance between both use types has been incorporated, at an overall density increase of 19 units, as compared to the as-of-right zoning. 80% AMI Guidelines - Rental Housing 100% AMI $80% AMI $Housing 30%Monthly Rent Per Bed Rent Studio - 1 person household $69,563 $55,650 $16,695 $1,391 $1,391 1BR - 2 person household $79,500 $63,600 $19,080 $1,590 $1,590 2BR - 3 person household $89,438 $71,550 $21,465 $1,789 $894 3BR - 4 person household $99,375 $79,500 $23,850 $1,988 $663 4BR - 4 person household $99,375 $79,500 $23,850 $1,988 $497 Bozeman - Income and Affordable Rents (80% AMI) Applied Incentive Analysis (157,060 project SF) Dwelling Type Current Lot Area per Dwelling Max Units per Dwelling Total SF AHO Lot Area per Dwelling Max Units per Dwelling (AHO) Total SF Rowhomes 3,000 52 156,000 1800 40 72,000 Apartments, Limited 3,000 52 156,000 2700 31 83,700 Total 3,000 52 156,000 2,192 71 155,700 • 30-year affordability period: Housing affordability for the designated units will be guaranteed for thirty years. Compliance of the affordability requirements will result from consistent ownership and also 3rd party property management. From an ownership perspective, the project is located in an Opportunity Zone and will be capitalized by investors in Qualified Opportunity Zone Funds. As such, the development will be held for a minimum of ten years, although most likely longer. With ownership holding the project long-term, knowledge and management of the affordability period and homes will be easily maintained. • From an operations perspective, we’ll employ a third-party property manager to oversee day-to- day operations. Affordable homes will be designated in their property management system in advance, similar to how a deed restriction applies to a property. Applicant underwriting and verification will rely on 3rd party solutions, such as ResidentVerfy from Entrata. This ensures consistency, reduces the possibility of applicant fraud, while also reducing the possibility of management error. With income verification a standard process in the application, the property manager will be able to assess qualification for the affordable homes. As provided in the Affordable Housing Ordinance, the aforementioned incentives are available to property owners and developers willing to construct housing at levels of affordability consistent with the housing needs and goals identified in the community plan, the community housing needs assessment, and the community housing action plan. Bozeman Community Plan Compliance The Community Plan is a policy document aimed to guide growth in Bozeman, establishing a basis for land-use and development decisions that reflect the community’s share values and priorities. The Plan is broken down into seven specific themes, of which our Project most closely aligns with goals contained in #2 – A City of Unique Neighborhoods and #3, A City bolstered by Downtown and Complementary Districts. Theme 2: A City of Unique Neighborhoods – Neighborhood Elements At a high level, the Community Plan is supportive of neighborhoods that offer a variety of quality housing options, promote walkability and connectivity to other commercial services. Our project’s location and programming specifically aligns with these goals, as detailed below: • N-1: Support well-planned, walkable neighborhoods. o This is accomplished through public trail access for the community benefit and interconnectivity of the site with neighboring developments. • N-1.2 Increase required minimum densities in residential districts o By complying with the shallow incentive (38.380.020-2) unit count was increased from 52 to 71 units. • N-1.1 Promote housing diversity, including missing middle housing. o Project provides two- and three-bed apartment flats and four-bed rowhomes. • N-1.5 Encourage neighborhood focal point development with functions, activities, and facilities that can be sustained over time. Maintain standards for placement of community focal points and services within new development. o Fulfilled through a 5,500 square foot clubhouse, including a fitness center, game lounge, demo kitchen, private and shared working spaces, etc. Additional outdoor amenities include a spa, grilling stations, dog park, and pet wash. • N-1.9 Ensure multimodal connections between adjacent developments o This property has been designed to interconnect within the Allison Subdivision. Street access from Student Dr and Opportunity Way give great accessibility for entering and leaving the site. • Goal N-3: Promote a diverse supply of quality housing units. o Done by adding in 31 - two and three bed apartment units and 40 - four bed rowhomes. • N-3.3 Encourage distribution of affordable housing units throughout the city with priority given to locations near commercial, recreational, and transit assets. o Accomplished through adding more housing near Montana State University. • N-3.7 Support compact neighborhoods, small lot sizes, and small floor plans, especially through mechanisms such as density bonuses. o By complying with the shallow incentive (38.380.020-2) an additional 19 units were added to the development. • N-3.8 Promote the development of "Missing Middle" housing (side by side or stacked duplex, triplex, live-work, cottage housing, group living, rowhouses/ townhouses, etc. o Accomplished through the 40 rowhomes featured on the perimeter of the site. • N-4.4 Ensure an adequate supply of off leash facilities to meet the demand of Bozeman dog owners. o Fulfilled through adding a dog park to the property to allow owners off leash opportunities for their dogs. There is a pet wash as well to give the owners more dog friendly options on the property. Theme 3 – A City Bolstered by Downtown and Complementary Districts Infill development adjacent to Montana State University reflects efficient land use policy, reducing infrastructure costs, improving access to community amenities and enhancing connectivity. The Complementary District theme specifically calls out property adjacent to the University and details other locational attributes that compare similarly to our property. • DCD-1.5 Identify underutilized sites, vacant, and undeveloped sites for possible development or redevelopment, including evaluating possible development incentives. o Converting undeveloped land bordering the south edge of Montana State to give more housing options to students. • DCD-1.10 Support University efforts to attract development near campus. o The site is located less than one mile from Montana State University • Goal DCD-2: Encourage growth throughout the city, while enhancing the pattern of community development oriented on centers of employment and activity. Support an increase in development intensity within developed areas. o There is growth towards the south of Bozeman, especially near the University. This reason is why we are planning to develop in the given area. • DCD-2.2 Support higher density development along main corridors and at high visibility street corners to accommodate population growth and support businesses. o S 11th Ave runs through the middle of the University and is home to south Bozeman’s current grocery store and shopping center, which are walkable from our property. Community Housing Needs Assessment Compliance The Community Housing Needs Assessment identified the housing challenges faced by local residents and city employees. The Assessment specifically identified a housing shortfall, which ultimately buoyed the recommendations in the Community Housing Action Plan. Increasing interest rates and elevated construction costs create additional headwinds to home ownership and the supply of new construction for- rent projects. That being said, we believe our project, it’s positioning and amenities align with the conclusions of the Assessment. • An estimated 5,405 to 6,340 housing units for residents and employees are needed by 2025, or an average of about 770 to 905 units per year. o The project will help reduce the housing shortage especially the need for affordable homes • Renters desire to live in the City nearer their jobs. Renters also desire to have extra storage and in-unit washers/dryers. Renters want pet-friendly rentals. o The project is less than a mile from Montana State University and only a couple miles from downtown Bozeman o In-unit washer/dryer for all homes o The project will be a pet-friendly community • Lastly, the distribution of community rentals by bedroom size suggested an undersupply of four- bedroom rentals o The project will offer much needed affordable four-bed homes Community Housing Action Plan The Community Housing Action Plan draws on the Housing Needs Assessment to prioritize strategies to increase community housing, which is effectively housing that those who live and work in Bozeman can afford. The 2020 plan identified three objectives, which align with our project: 1. Ensuring community housing serves the full range of incomes without losing sight of safety net programs for extremely low income and homeless families. This includes safety net rentals below 30% AMI (about $20,000 per year), additional resident and employee rentals up to 80% AMI (about $55,000 per year), and ownership housing up to 150% AMI (about $104,000 per year). • The project has designated affordable homes that will be offered at 80% AMI 2. Producing community housing at a rate that exceeds, or at least matches, job growth so that new employees can find homes. • The 71 homes in the project will help add inventory to match job growth and fill any housing shortage. 3. Striving to produce community housing at a rate that matches the spectrum of community housing needs, while also preserving what we have through a target of no net loss of existing community housing stock below 80% AMI. • The project will provide housing to match the spectrum of housing needs by offering affordable homes at 80% AMI as well as market rate homes. The Community Housing Action Plan's Up-Zoning, action plan recommendation was incorporated into the AHO Ordinance and serves as this project’s primary incentive. Sustainability Features The project is being designed to meet, at a minimum, the National Green Building Standard (“NGBS”) bronze certification. Sustainable features include all electric residential units, Energy Star certified appliance package, and WaterSense fixtures. Electric car charging will also be possible for residents of the project. Affordable Home Incentive Requirements 1. Four affordable rental homes and 67 market rate rental homes 2. The Project will provide 5% of its single-household attached dwellings (rowhomes) and 5% of its Multi-household dwellings as affordable rentals to those households with income levels at or below 80% of AMI for 30 years. 3. Total bedrooms a. 23 two-bed apartments, 46 beds (1 two-bed apartment is affordable) b. 8 three-bed apartments, 24 beds (1 three-bed apartment is affordable) c. 40 four-bed rowhomes, 160 beds (2 four-bed rowhome is affordable) 4. Project is 100% rental homes 5. Affordable home locations highlighted below (Red: four-bedroom rowhomes, Blue: two-bedroom flat, Orange: three-bedroom flat). 6. Applicable 80% AMI and rental rates in table below. Will use current 80% AMI data as HUD releases each year. 7. The following shallow incentives are being requested for the project: a. Ten percent reduction in lot area for Apartment, Limited, referenced in Table 38.320.030.A b. For each single-household attached dwelling (townhouse or rowhouse) a minimum lot size of 1,800 square feet. One additional story of height beyond that allowed beyond that allowed in R-3 c. Minimum parking requirement of one stall per dwelling for all districts other than B-3 and bicycle standards and requirements of 38.540.050 still apply 8. See ‘Affordable Housing Information’ section in the narrative above 9. The project will be completed in one phase under a single GMP 10. N/A 80% AMI Guidelines - Rental Housing 100% AMI $80% AMI $Housing 30%Monthly Rent Per Bed Rent Studio - 1 person household $69,563 $55,650 $16,695 $1,391 $1,391 1BR - 2 person household $79,500 $63,600 $19,080 $1,590 $1,590 2BR - 3 person household $89,438 $71,550 $21,465 $1,789 $894 3BR - 4 person household $99,375 $79,500 $23,850 $1,988 $663 4BR - 4 person household $99,375 $79,500 $23,850 $1,988 $497 Bozeman - Income and Affordable Rents (80% AMI) 11. Minimum percentage of homes 5% or 3.55 affordable homes; 4 homes provided 12. Affordable unit mix is similar to project unit mix a. Two-bed apartment: affordable 25% vs project 32% b. Three-bed apartment: affordable 25% vs project 12% c. Four-bed rowhome: affordable 50% vs project 56% 13. Affordable homes will have the same finishes as market rate units and residents will have similar access to all community amenities. 14. Project will be constructed in one phase.