Looking for Solutions: How Do We Get Workforce Housing Built?

5 min read

By David Senden, KTGY Group, Inc.While we in the housing industry cringe at recent falling home prices, there are large groups of people for which prices can’t fall far or fast enough. Over the past decade, as the rising cost of housing has priced more and more people out of the market, the term “affordable […]

By David Senden, KTGY Group, Inc.While we in the housing industry cringe at recent falling home prices, there are large groups of people for which prices can’t fall far or fast enough. Over the past decade, as the rising cost of housing has priced more and more people out of the market, the term “affordable housing”—often associated with low-income housing—is being replaced by the term “workforce housing” to better reflect that it isn’t just “poor” families that can’t afford to buy a home or pay escalating rents.The lack of affordable workforce housing continues to be a chronic concern to communities across the U.S. And it is essential to the well-being of a community and the ability of businesses to attract and retain workers. But, how do we get this workforce housing built?Public monies, redevelopment agencies, non-profit developers and tax credits can assist in delivering quality living environments for the workforce such as the Nuevo Amanecer Apartments in Pajaro, Calif. Built by non-profit builder South County Housing Corporation of Gilroy, Calif. and designed by KTGY Group, Nuevo Amanecer offers affordable, quality homes for low income migrant and resident farm workers. The efficient, high-density design promotes affordability, and delivers comfortable living spaces. Solar roof panels, made possible through grants and subsidies, are used to generate electricity, which aids in affordable living. Paseos and shaded areas promote neighborly interface, safety and security. Another approach is to reduce home prices by designing and building housing that can be delivered at a substantially lower development cost. In some ways, the current market conditions are helping this along. Land prices are falling, as are construction costs. But, if you can speed up the process and reduce the construction costs even further, the developer may be able to hit a price point that will be affordable to the workforce buyer without the need for subsidies or deed restrictions. This would allow the buyer to enjoy the benefits of investing in the housing market and reap any economic gains from it.Furthermore, both the builder and the consumer need to think smaller. Do we really need a formal living room or dining room? Can we design more open floor plans so that residents can customize their space to better fit their needs? Design becomes critical as a house’s size is reduced. From the site planning, to the building design, using resources efficiently is critical. The spaces within the home need to be well organized, do multiple duty, and allow for changing uses as a family’s needs change.Necessity surely leads to invention. On the boards now are a host of options that show that bigger is not necessarily better, especially when it comes to the mortgage payment. Some of these options break new ground, using small footprints, building vertically, using tandem garages, and reexamining the modern family. Other solutions simply look to the past to inform the future. Children sharing a bedroom, fewer bathrooms, and master bedrooms without a dedicated bathroom are all options that were considered normal in the past, and maybe again. School districts, colleges and large corporations need to take a more active role in ensuring availability of workforce housing for their employees. In Silicon Valley, some companies are offering their employees an Employer-Assisted Housing plan to help pay for a downpayment or closing costs. Multi-family residential developer Thompson | Dorfman of Sausalito, Calif. and American Campus Communities of Austin, Texas working with KTGY have found success with public/private partnerships at colleges.The structures of the deals vary, but generally, the learning institution recognizes a need for housing and uses an experienced developer to shepherd the various moving pieces of the project. For this, the developer receives a developer fee, or a portion of the sales price or rental income. The downside in these scenarios is that some type of public money is necessary. Since public money is scarce, these opportunities can be limited. Other factors involved in getting workforce housing built include reducing land costs. Builders should target sites with low land costs such as blighted urban areas, under-performing strip retail/industrial sites, de-commissioned military installations, closed schools and other surplus public sites. It can be tough going through entitlements.Experience and a soft diplomatic touch might be necessary, but as cities awake to their need for workforce housing, for the right builder, they will be willing to smooth some of those rough development edges. Building workforce housing is truly a team effort. Builders are a piece of the equation, but each city needs to do its part, also.To increase workforce housing, municipalities should consider implementing the following as part of their overall strategies:• Fast-track/streamlined permit/review process including “pre-project” environmental review (or program EIR) to provide CEQA level analysis of general project parameters, shortening timeframe of entitlement and avoiding judicial challenges• Eminent domain condemnation of unused/non-performing sites• Tax incentives• Reduction/waivers of park requirements for projects located within a reasonable walking distance to an existing school, park or other recreational open space• Flexibility in zoning regulations to facilitate a wider range of creative design alternatives and increased efficiency including reduction and/or elimination of building setbacks, minimum lot dimensions and areas• Reduction of parking requirements, especially for sites adjacent to plentiful on-street parking• Reduction/waivers of development fees• Waiver of building height restrictions• Density bonuses for qualified workforce housing projects• Utilize inclusionary zoning• Donate municipally-owned land• Create a Housing Trust Fund• Encourage non-profit housing developers• Creation of zoning or overlay districts which specifically allow workforce housing without the need for zone changes, General Plan amendments, specific plans, use permits or other extraordinary approvals• Promotion of “best practices”• Smart Growth development practices• Increased educational outreach to avoid NIMBYismAdditionally, municipalities should institute safeguards to prevent investment speculation such as rent control, deed restrictions, and limitations on appreciation income/occupation standards.The lack of workforce housing continues to be a persistent issue for workers and employers. It threatens not only an area’s overall quality of life, but its economic vitality as well. The lack of workforce housing contributes to urban sprawl, pollution, traffic congestion and difficulties in attracting and retaining employees. A variety of well-designed housing options, including homes for purchase and rental as well as multifamily units, makes a stronger community through economic, environmental, and educational benefits. David Senden is a design principal at KTGY Group, Inc., Architecture and Planning, with offices in Irvine, Santa Monica, Oakland and Denver

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