Close-Up on Albuquerque’s Turnaround
- Sep 16, 2019
Albuquerque, N.M., has sure had its headwinds, but the metro’s affordability, coupled with some recent large investments from giants such as Facebook or Netflix, has increased job growth prospects, boosting rental demand along the way, according to a recent Yardi Matrix report.
In an interview with Multi-Housing News, Chris Baca—founder, president & CEO of local development company YES Housing—talks about the current state of the metro’s multifamily market, offers details about his company’s most recent affordable housing projects and reveals his expectations for the future.
How would you describe the metro’s multifamily market?
Baca: We have a strong apartment rental market. The city is in growth mode as coastal cities are more expensive and large to mid-sized western cities are costlier as well. Investors are beginning to see Albuquerque and other New Mexico cities as attractive to invest in because of these lower costs as well as more opportunities to grow their businesses.
Which submarkets of the metro are in greater need of affordable housing developments and why?
Baca: All areas are in need, but there is more growth opportunity in the southwest quadrant of the city because there is more available land. However, there needs to be a balanced approach as we do not want to flood one area with only affordable multifamily units.
Most recently, you began working on Nuevo Atrisco. How is that going? What other projects do you have underway?
Baca: The Nuevo Atrisco mixed-use site has been launched and construction is underway. We are in the process of planning and designing the second half of the property to incorporate retail/commercial space, including a food hall and a public plaza. The food hall and retail space open out into the plaza, which has shade structures, verdant southwest plants, a water splash area and a performance stage.
We just finished a mixed-use, urban infill project in downtown Albuquerque, called The Imperial Building. Additionally, we are building a facility for a homeless service provider in the city. It is called Hope Village. We are also underway in building an affordable multifamily complex—Skyview Terrace—in Hobbs, N.M., which is experiencing tremendous growth because it sits on the Permian Basin. We are also building New Frontier in Phoenix to complement our three complexes in that metro area.
Please tell us a few details about the challenges you need to overcome when building or revitalizing affordable communities.
Baca: The biggest challenge we have is accessing capital to build affordable multifamily projects. There are always areas of great need, but market-rate developers usually steer clear of more difficult areas. It is left to nonprofit providers to step in to those areas. Once we are able to help stabilize these areas, other developers step in with their products. So we are always looking for ways to leverage our funds with subsidies and/or partners willing to step in.
What elements do you consider most important for affordable housing developments nowadays and why?
We believe that affordable housing needs to have mixed-use partners to help revitalize the area. We also believe that we need to have market-rate units as part of the equation so as to make the projects financially viable. Providing affordable housing cannot be successful without including attractive amenities to residents and to the neighborhoods in which they are located. Our end goal is to revitalize communities to positively impact all residents and make the areas more attractive for other investors to locate businesses, bring jobs and bring value to the total community.
Several major projects are currently in the works across the metro. How do you expect these to influence the metro’s multifamily market going forward?
Not only are Facebook and Netflix establishing a major presence in the metro area, but NBC Universal has recently announced a major development in the downtown area of the city. Those major investments are making Albuquerque and New Mexico more attractive and in growth mode. That means that there will be much more demand for apartments, housing and services to the population. We can only expect more businesses and more growth as a result.