ST Plans Zero-Cost Land Transfer for Affordable Housing
Credit: Sound Transit
On Thursday, the Sound Transit Board approved a zero-cost land transfer to two affordable housing developers for a parcel of land in the First Hill neighborhood valued at $8.6M.
In a joint project, Bellwether Housing and Plymouth Housing Group propose building a high-rise apartment with 308 subsidized units on a half-acre parcel near the corner of Madison Street and Boylston Avenue.
"Bellwether and Plymouth deserve a lot of credit to come up with a very ambitious idea to leverage a great many affordable units," said Peter Rogoff, CEO of Sound Transit. "If we can pull off a project this robust, at least as staff, we can recommend to you that you consider discounting to zero."
The board also approved moving forward with two other affordable housing projects near the future Roosevelt Station and Capitol Hill Station.
A new state statute requires Sound Transit to prioritize affordable housing by offering at least 80% of a surplus property first to affordable housing projects for families making 80% or less of area median income (AMI). To accomplish this goal, the legislature allows Sound Transit to discount the price of parcels or offer a no-cost land transfer to qualified entities. All three affordable housing projects request a discount in land value to reduce the cost of the projects.
Partnering together in First Hill, Bellwether Housing and Plymouth Housing Group propose building 111 housing units for seniors making 30% of AMI or less and 197 units for households that earn between 30% and 60% of AMI, with 30 of those units family-size. Retail spaces are planned for the ground floor and no on-site residential parking will be provided. The project is estimated to cost nearly $92m assuming the zero-cost land transfer. The land was valued at $8.6M.
"Setting a property value at zero comes with big expectations that the project we end up with is worthy of the investment," said Brooke Belman, a land use planning and development director with Sound Transit.
Rogoff told the board because much of fundraising for the project still needs to happen the decision would come back to the board if the project changes. The developers are seeking $39m in public subsidies - $30m from Seattle's Office of Housing, $1m from King County, $3m from the state's housing trust fund - including investments from both Plymouth and Bellwether.
"This is an exceptional opportunity for us to accelerate the creation of affordable housing in a place where it has become pretty prohibitive," said Dow Constantine, King County Executive and Sound Transit boardmember before the vote.
Bruce Dammeier, Pierce County Executive and ST Boardmember voiced opposition against a zero-cost transfer.
"While I appreciate the ambitious nature of this project," Dammeier said. "I think that it creates an expectation for future projects and being at the far end of the line and I am very concerned about how that is going to play out."
"We all acknowledged that we are early in this journey of TOD (transit oriented development) and early in this journey of the process of how we resolve these things, and I think that going to no cost is a very dangerous precedent for a very noble goal," he added.
Dave Earling, Mayor of Edmonds and Sound Transit boardmember, abstained from the vote wanting to wait until the project was further along before approving a zero-cost transfer. Sound Transit staff anticipates returning to the board in 2018 with a final agreement.
A project near the Future Roosevelt Station also moved forward Thursday after the board approved beginning negotiations with Bellwether Housing and Mercy Housing Northwest to sell the 1.2-acre parcel, valued at $18.5m, for $6.75m. The project includes 245 units affordable for households earning at or below 60% AMI. A daycare, retail space and community room is also planned.
And the board also approved entering into negotiations on a plan that includes swapping a piece of land adjacent to the Capitol Hill Station with Seattle Central College for a parcel about a block south, known as the Atlas site. Capitol Hill Housing has proposed building 78 affordable units on the Atlas site and paying the difference in the land value for the slightly bigger parcel estimated at $2.2m.
Sound Transit said this swap was a win for both parties: supporting the college's expansion plans while gaining a site more suitable for housing, which allows for more affordable units to be built. Seattle Central College had first right of refusal on the Sound-Transit-owned property obtained during negotiations with Sound Transit over tunnel easements. The amount Capitol Hill Housing will ultimately pay for the property is still undecided.