NHPF-Authored Articles & Industry Reports

MultiFamily Executive, July 24, 2018 Local Action to Provide More Affordable Housing by Neal T. Drobenare, Senior Vice President, Acquisitions

Four ways municipalities can improve the success of gentrification.

their higher income constituents by upzoning places which are surrounded by low density development?

Ten years ago I worked with Catholic Charities to build St. Martin Apartments in DC’s Eckington neighborhood on one of the last empty parcels available to build affordable housing. The neighborhood was gentrifying because of the anti-crime work of an interfaith coalition of local, mostly

Next we have to increase density in our low income neighborhoods. I would propose allowing developers of properties with at least half Low Income Housing Tax Credit (LIHTC)-funded units to build five-six story apartment buildings in otherwise single family zoned communities. Like Portner Place on U Street in DC, the upper income units will provide some level of support for the LIHTC units. However, all that will still not be enough, municipalities need to: • Provide full tax abatement on market rate units in mixed income LIHTC developments in order to subsidize low income units • Modify the local hiring requirement so that general contractors can comply while having a competitive number of sub contractors bidding on work. This can be accomplished by requiring “local hire qualified” firms to be within 5% of a comparable non-qualified company bid or providing a waiver. Also consider creating a job training system that provides enough skilled craftsmen, allowing for a realistic ramp-up period that recognizes the amount of time it takes to go from apprentice to journeyman. Allow these craftsman the freedom to move to neighboring counties. • Make it easy for new tech-oriented construction companies to work in cities. • Change single family zoning to allow accessory units and change zoning to encourage construction of duplex housing in all single family zones. As a child, my high school educated parents were able to afford a home only because we had a rental unit on the first floor that effectively paid our mortgage. Provide a tax credit to those higher income duplex-owners who rent to a low income family. Finally, increase municipal commitments to funding affordable housing—and quickly. In our experience, unless affordable housing is introduced at the same time that an area is gentrifying, it may never be built. The District spends more per capita on affordable housing than any other city in the nation and more in absolute dollars than most cities many times it size. Mayor Bowser and the Council should be commended for this; it is no small thing. But with the lack of affordable housing growing rapidly in many other gentrifying cities like Los Angeles, Orlando and Las Vegas as well and a small window in which to make a difference quickly closing, more needs to be done.

Neal T. Drobenare

low-income residents whose families had deep roots in the area. Then a number of young professionals moved in. Many of them had only recently earned their way out of affordable housing, yet they were voraciously opposed the construction of St. Martin’s, which was the last opportunity for many members of the coalition to live in a neighborhood they made safe for the “gentrifiers.” At the same time, those “gentrifiers” were fixing up dilapidated housing; demanding and getting better infrastructure; bringing new retail opportunities to what had been an underserved community and doubling down on the community improvement efforts of the long term locals. These newcomers were clearly making the neighborhood better for anybody who could still live in it. But how can lower income people afford to stay in a more costly neighborhood? We have to start with the proposition that bringing higher-income people into poor neighborhoods is a proven successful way to bring change to challenged areas. The proposition of economic integration holds true throughout the country, not just in DC I am a big supporter of the War on Poverty and many of the programs that came out of it, but they haven’t succeeded in bringing positive improvements the way that economic integration has. Our job is to find ways to ensure that gentrification brings the benefits of change to the original low income residents as well as newcomers to an improved area. If this is a zero sum game, low-income residents will always lose. One successful way for low income people to stay in gentrifying neighborhoods is to increase density. Upper-income folks are in unlimited supply, but housing supply is only limited by investment. If there is enough supply, pricing will go down and affordability will go up. So, first of all, we recommend zoning changes, particularly upzoning (changing the zoning in an area, usually to allow greater density or commercial use) in high- income neighborhoods which will take the pressure off lower-income neighborhoods. The question then becomes, are elected officials willing to anger

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