Affiliated Development to Construct Workforce Housing in South Florida
The Spruce is the second public-private partnership between Affiliated Development and West Palm Beach.
A rendering of The Spruce in West Palm Beach, Fla. Image courtesy of Affiliated Development
Affiliated Development and the city of West Palm Beach, Fla., are teaming up on a second public-private partnership that will aim to expand workforce housing in the city. Last week, approvals were granted for The Spruce, an eight-story, 270-unit mixed-income apartment building.
Construction is expected to begin this fall. The property is located on Spruce Avenue between 24th and 25th Streets within the city’s Northwood Village neighborhood. The community will have a parking garage and ground-floor retail space, as well as a rooftop pool, sports bar-themed pub room, coworking lounge, fitness center with a spin and yoga studio, pickleball court and gated off-leash dog park.
On April 3, the West Palm Beach City Council granted approval for special site plan review and approved an agreement between the city’s Housing & Community Development department and Affiliated Development, a national real estate investment and development company headquartered in Fort Lauderdale, Fla. Affiliated will receive $2.5 million in grant proceeds over a three-year period, as well as fee waivers and reductions offered by the department.
The Spruce is the second public-private partnership between Affiliated and the City of West Palm Beach. The Grand, an $85 million, 309-unit mixed-use development located in the Historic Northwest neighborhood in downtown West Palm Beach, is scheduled to open its doors in May.
Affiliated began construction of The Grand in September 2021. The firm financed The Grand with a $53 million first mortgage from Bank United. Other investments included $15 million in financing from the West Palm Beach Community Redevelopment Agency and the Housing & Community Development department, as well as an investment from the Affiliated Housing Impact Fund LP and a private family office.
Both properties have units reserved for lower-income residents. The Grand has 204 units set aside for workforce housing, while at The Spruce, 80 of the project’s 270 units will have restrictions at 100 percent of the Area Median Income and 10 units will be restricted at 80 percent of AMI. Units will start at $1,380 per month.
Addressing a need for workforce housing
Nick Rojo, Affiliated Development president, said in a prepared statement that the company is committed to addressing South Florida’s workforce housing crisis. Nearly 60 percent of renter households in Palm Beach County are cost burdened, making Palm Beach County one of the least affordable places to live in the country. Rojo noted the influx of new residents and businesses to West Palm Beach has exacerbated the problem and made it even more critical to build this type of product.
Mayor Keith James, who launched the “300 in 3 Vision for Workforce/Affordable Housing” initiative in 2020, said 284 additional workforce units will be added throughout the city through these public-private partnerships. James noted that the city has surpassed his goal of creating 600 units in his first four-year term and said he will continue to pursue additional units of workforce and affordable housing for the growing community.
Affiliated was formed in 1982 and works directly with communities to improve the quality and sustainability of housing stock for residents in order to build Class A luxury apartments at attainable rents. In November 2020, Affiliated launched a $125 million fundraising effort to develop workforce housing in South and Central Florida. Investments came from several local public pension plans including the West Palm Beach Police Pension Fund.
Last July, Affiliated formed a public-private partnership with the Boynton Beach City Commission and the Boynton Beach CRA to develop The Pierce, a 236-unit, mixed-use, mixed-income workforce housing project in Boynton Beach, Fla. In 2019, European investment firm Round Hill Capital made two equity investments in Affiliated projects in South Florida, including The MID, a 230-unit mixed-income property in Lake Worth Beach, Fla., and The SIX13, a 142-unit workforce housing project in Fort Lauderdale.
