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Home My WebLink AboutLAKEVIEW ON THE RISE, AFFORDABLE HOUSING - PDP - PDP170014 - SUBMITTAL DOCUMENTS - ROUND 2 - MODIFICATION REQUEST! Lakeview on the Rise Modiﬁcation of Standards Request 3.8.30 Multi-Family Dwelling Development Standards and 4.5 Low Density Mixed-Use Neighborhood District (L-M-N) Pedcor Investments is requesting the following modiﬁcations of standards in support of a PDP appli- cation currently under consideration. The applicant is requesting Modiﬁcations of Standards for the following: 3.8.30(B) Mix of Housing Types 3.8.30(F)(2) Variation Among Buildings 4.5.(E)(4)(i) Maximum Floor Area. Land Use Code Requirement 3.8.30(B) Mix of Housing Types (B) A complete range of the permitted housing types is encouraged in a neighborhood and within any individual development plan, to the extent reasonably feasible, depending on the size of the parcel. The following minimum standards are intended to promote such variety: (1) A minimum of two (2) housing types shall be required on any development parcel sixteen (16) acres or larger, including parcels that are part of a phased development. (3) The following list of housing types shall be used to satisfy this requirement: a) Small lot single-family detached dwellings on lots containing less than six thousand (6,000) square feet. b) Two-family dwellings. c) Single-family attached dwellings. d) Mixed-use dwelling units. e) Group homes. f) Multi-family dwellings containing three (3) to four (4) units per building. g) Multi-family dwellings containing ﬁve (5) to seven (7) units per building. h) Multi-family dwellings containing more than seven (7) units per building. 3.8.30(F)(2) Variation Among Buildings (F)(2) For any development containing at least three (3) and not more than ﬁve (5) buildings (exclud- ing clubhouses/leasing ofﬁces), there shall be at least two (2) distinctly different building designs. For any such development containing more than ﬁve (5) buildings (excluding clubhouses/leasing ofﬁces), there shall be at least three (3) distinctly different building designs. For all developments, there shall be no similar buildings placed next to each other along a street, street-like private drive or major walkway spine. Building designs shall be considered similar unless they vary signiﬁcantly in footprint size and shape. Building designs shall be further distinguished by including unique architectural eleva- tions and unique entrance features within a coordinated overall theme of roof forms, massing propor- Lakeview on the Rise Modiﬁcation of Standards 3.8.30 and 4.5 1 tions and other characteristics. Such variation among buildings shall not consist solely of different combinations of the same building features. 4.5.(E)(4)(i) Maximum Floor Area. (i) The maximum gross ﬂoor area (excluding garages) shall be fourteen thousand (14,000) square feet.. Discussion The Lakeview on the Rise development will serve families at or below 60% of the area median income (AMI) and therefore qualiﬁes as an affordable housing development. The ﬁnancial structure of an af- fordable housing development depends on many factors, some of which are beneﬁcial while others push the deal in the opposite direction. This development will be ﬁnanced with 4% tax credits and tax exempt bonds. This means that the ﬁnancing is heavier on the loan side, and much fewer costs get covered by tax credits. Other affordable housing developments, in fact the majority developed in Col- orado since the recession, rely on 9% tax credits or state tax credits, which both help to cover more cost. However, the tradeoff to win an award of these competitive tax credits, developers are forced to target populations at lower AMI levels – 50, 40, and 30%. Pedcor’s application for 4% tax credits is not competitive in nature, and therefore, we can offer our units at 60% AMI. Recently, very few affordable housing units that are affordable at the 60% level have been constructed, because the ﬁnancing is that much more difﬁcult to pencil out. For this rea- son, we include a moderate amount of 3-bedroom, 2-bathroom units in our development, because though they are the most expensive to build, they give the fastest return. Lakeview on the Rise is a rare opportunity for an experienced developer to offer affordability at the 60% AMI level, but in order to do so, we must be very sensitive to our budget. Not only must we max out our rents at the 60% level (the highest AMI level to count as “affordable”), we take advantage of economies of scale. In our 30 years of experience, 200 or more units in build- ings that are at least 16 units each (all the same unit type per building) at an overall site density of around 12 units per acre is a sweet spot for these types of developments from a ﬁnancial perspective. Deviations downward on both of those metrics put a lot of stress on the development’s budget. This site has been a challenge to design and develop for the development team. Of the 20 acres that are part of the gross site, approximately 7 acres of the site are being dedicated for natural habitat buf- fer zone, as well as additional ROW being dedicated for College Avenue ROW. This is approximately 35% of the site. As a result, we have spent a considerable amount of time designing the remaining site balancing the requirements if the land use code, with the very real needs to have a ﬁnancially feasible development that can support the goals of providing 100% affordable housing. 3.8.30(B) Mix of Housing Types and 4.5.(E)(4)(i) Maximum Floor Area. The City’s Code requirements that parcels greater than 16 acres have more than one housing type and that no building can be more than 14,000 square feet are very restrictive for the noncompetitive 4% tax credit / tax-exempt bond ﬁnanced developments, which are the number one source of new- construction apartments for households at 60% AMI. In order for this speciﬁc type of affordable hous- ing to be developed, the ﬁnancial challenges posed by these restrictions must be removed. The unit count target of 200+ cannot be met on this site in the ﬁrst place, but complying with this sec- tion of the code would reduce the number even further. Even if we could still ﬁt 180 units in more, smaller buildings, the price of per-building expenses would go up, including the barely-supportable tap Lakeview on the Rise Modiﬁcation of Standards 3.8.30 and 4.5 2 fees we’re expecting to pay. The cost per unit would increase as well, due to there being more build- ing exterior per unit. We cannot commit to buildings with fewer than 8 units due to the cost associated with that change. In order to develop within a reasonable budget, we need to stay as close to the sweet spot metrics as we can, which includes construction of the same unit type throughout an entire building. We also cannot provide the ﬁnancially necessary 3-bedroom units in an economical con- struction conﬁguration without going over the 14,000 square foot limit. Our building types that we are providing are various conﬁgurations of 8 and 12 unit buildings which does provide diversity in the site, but does not meet the standard outlined in the code as both building conﬁgurations are more than 7 units per building. Similarly, on building size, all of our buildings are under 14,000 square feet in size, except for the three bedroom buildings, of which we have three, and these buildings are 17, 244 square feet in size. We have also located these three buildings in the cen- ter of the site, and are largely not visible from outside the property. In short, it is too expensive for this type of affordable housing development to comply with these sec- tions of the Code. Other types of affordable housing developments can likely support the cost of com- plying because they have access to more tax credits, but this is not the case for Lakeview on the Rise. Assuming that the City’s goal of supporting affordable housing includes even the 60% AMI af- fordable category and 3-bedroom units, and given that there are unique budget challenges to 60% AMI developments, we hope that this request for a modiﬁcation to standard will be granted. 3.8.30(F)(2) Variation Among Buildings Great care has been taken in the design of the site to provide variation among the buildings, as well as variation in buildings that are next to each other, to the extent possible. Within this standard we have ﬁve different building types, which exceeds the standard. We have also varied the architecture within those building types to provide additional diversity. At issue is the requirement that no more than two building types be placed next to each other. In our case, we placed the 3 bedroom buildings (building type 12c) closest to the recreation center and park. There are two buildings facing Rohan Rise, and one building on Debra Drive, but all are visible from Stoney Brook Road. We did explore alternative placements early on in the design phase, however, we concluded that this was the optimal placement of the buildings The three bedroom units are the most likely to be rented to families and to house children. CHFA, HUD, and our institutional tax credit investors are all in agreement that their location on the same side of the street as the playground and clubhouse is ideal. Furthermore, it could be more difﬁcult to convince families to rent one of these units if they know that their children would have to cross a street-like private drive (or public street) in order to get to the playground or clubhouse. The 3-bedroom units in the two similar buildings next to one another provide a necessary ﬁnancial buoy to the overall development. All of these buildings have direct sidewalk pedestrian connections to the playground and clubhouse. Complying with this Code section would negatively impact our ability to realize the rental income from these units which do the most to offset the cost of developing affordable housing and could have an adverse effect on the safety of some of our residents. Lakeview on the Rise Modiﬁcation of Standards 3.8.30 and 4.5 3 JUSTIFICATION Pedcor Investments requests, as outlined in 2.8.2(H)(1), that this modiﬁcation of standards request regarding 3.8.30(B) Mix of Housing Types, 3.8.30(F)(2) Variation Among Buildings, and 4.5.(E)(4)(i) Maximum Floor Area. be approved as our request will promote the general purpose of the standard equally well or better than would a plan which complies with the standard. As has been demonstrat- ed, building an affordable housing community with 4% tax credits is very challenging, and to do so, construction of the units must be as efﬁcient as possible. It is our belief that approving these minor amendments to the code would be un-noticeable to most in the general public, and would help fulﬁll a well documented need of providing affordable housing to the 60% AMI population. In addition, pursuant to 2.8.2(H)(2), the granting of a modification from the strict application of any standard would, without impairing the intent and purpose of this Land Use Code, substantially allevi- ate an existing, defined and described problem of city-wide concern or would result in a substantial benefit to the city by reason of the fact that the proposed project would substantially address an im- portant community need specifically and expressly defined and described in the city's Comprehensive Plan or in an adopted policy, ordinance or resolution of the City Council, and the strict application of such a standard would render the project practically infeasible. In order to build and affordable hous- ing community that meets families at or below 60% of the area median income (AMI), granting this modification would allow more efficient construction of the units to meet this income level on a site that is already constrained. 1.2.2 Purpose The purpose of this Code is to improve and protect the public health, safety and welfare by: (A) ensuring that all growth and development which occurs is consistent with this Code, City Plan and its adopted components, including, but not limited to, the Structure Plan, Principles and Policies and associated sub-area plans. (B) encouraging innovations in land development and renewal. (C) fostering the safe, efﬁcient and economic use of the land, the city's transportation infrastructure, and other public facilities and services. (D) facilitating and ensuring the provision of adequate public facilities and services such as transporta- tion (streets, bicycle routes, sidewalks and mass transit), water, wastewater, storm drainage, ﬁre and emergency services, police, electricity, open space, recreation, and public parks. (J) improving the design, quality and character of new development. (K) fostering a more rational pattern of relationship among residential, business and industrial uses for the mutual beneﬁt of all. (L) encouraging the development of vacant properties within established areas. (O) encouraging a wide variety of housing opportunities at various densities that are well-served by public transportation for people of all ages and abilities. As has been demonstrated, not providing the required mix of building types, and a slight variation to the variation among buildings would provide a well documented community need in construction af- fordable housing serving families at or below 60% of the area median income (AMI). Lakeview on the Rise Modiﬁcation of Standards 3.8.30 and 4.5 4