The City of Seattle announced Monday it is acquiring three nearly complete Capitol Hill developments to be turned into “new income- and rent-restricted housing” as part of a first round of acquisitions powered by millions of dollars of local, state, and federal funding.
CHS reported here on one of the developments part of the acquisition — a microhousing project on Boylston Ave E that had been teed up to include two of its 60 units under the city’s Mandatory Housing Affordability program.
The seven-story project is being acquired by the city and will be used to offer housing to “adults experiencing homelessness or at extreme risk of homelessness” and will be operated by the Low Income Housing Institute.
A rendering of the 420 Boylston Ave E project
Two other Capitol Hill properties on Harvard Ave E and 10th Ave E are also part of Monday’s announced acquisition plans.
The project at 225 Harvard Ave E will create 71 units for homeless adults while the project near 10th and Republican will be operated by YouthCare and house 18 to 24-year-olds experiencing homelessness.
YouthCare already has major plans in the neighborhood where it is partnering with Community Roots Housing on an eight-story affordable housing, and homeless youth “education and employment academy” project at Broadway and Pine. Former mayoral candidate Colleen Echohawk, meanwhile, has stepped in as interim CEO of the nonprofit.
UPDATE: The city has provided agreed sale prices for the three properties.
- 420 Boylston Ave E — $16 million: Developer Johnson & Carr purchased the Boylston Ave E property and house most recently used as an office building in August of 2018 for $2.35 million to build the seven-story “small efficiency dwelling unit” project. The property was subject to a “housing bonus covenant,” the instrument used to guarantee a portion — in this case, two — of its units would be reserved for low income renters under the city’s Mandatory Housing Affordability program.
- 225 Harvard Ave E — $21 million: The eight-story development went through design review in 2018. Highpoint Investments purchased the property for $1.2 million in 2019. It, too, was subject to a “housing bonus covenant.”
- 506 10th Ave E — $10.975 million: Developers Prestige Partners and Valere Development purchased the property previously the location of a single family-style home for $700,000 in 2015 with plans for the five-story building.
The deals work out — roughly — to a cost of about $290,000 per unit. By contrast, recent deals involving larger living spaces in Capitol Hill buildings constructed within the last 20 years have commanded as much as $450,000 per unit.
The acquisitions are part of Mayor Jenny Durkan’s announcement of $50 million “to rapidly create new income- and rent-restricted housing in Seattle.” The 165 new homes across three new buildings are planned to be ready for tenants this fall.
Seattle’s local investment of $25 million is matched by funding from the Washington State Department of Commerce’s new Rapid Capital Housing Acquisition program.
In June 2021, the Seattle City Council and Durkan signed a joint proposal that included $28.5 million from the American Rescue Plan for the acquisition of housing. The Capitol Hill deals are part of the first round of acquisitions, with more announcements expected in the coming weeks, the city says.
In the announcement, the mayor’s office noted the speedy timeline and said “Seattle’s current real estate market presents unique opportunities to acquire newly constructed market-rate apartment buildings and quickly convert them to affordable housing.”
“Our homelessness crisis has always been a housing crisis,” Durkan said in the press release on the deals. “The City of Seattle continues to make bold investments to address our homelessness crisis as quickly as possible. With this latest investment, we are building on a completely new approach that has the potential to become a national model for rapidly creating affordable housing.”
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I applaud the city acquiring these buildings, but I do wonder…would they have been able to acquire even more apartments if these buildings were in less expensive places in the city?
Also, does the city plan to include any kind of services for the mentally ill or addicted in or near these buildings? Great to get people shelter but we have to address some of the other things holding them back from success in life.
“Seattle’s current real estate market presents unique opportunities to acquire newly constructed market-rate apartment buildings and quickly convert them to affordable housing.”
I read this as a sideways way of saying the developers who built these are now desperate to offload them because the current economic and political climate means that they are having a difficult time finding tenants for empty units and a difficult time collecting any rent from the ones that aren’t empty anyway…. better to just sell them to the city and be done with them.
Your read on the developers is accurate in my opinion. These are buildings that have ‘micro-units’ and these smaller spaces just aren’t renting out in Seattle anymore due to everyone wanting more space as they work from home. Demand for studios has plummeted while 2BRs have skyrocketed. Developers don’t want to deal with that, might as well sell it to the city that’s looking for low cost and high supply formats
Regarding the first question, I think it’s great that every part of the city have some of these. I’m looking at you Magnolia and Laurelhurst.
About the second question: no. And if they do, it won’t be enough (like housing). It will look more like Belltown than 3rd and Pine, but it won’t be a complete solution.
It’s not an easy question to answer but my experience with it having worked with these folks before is outcomes are better when housing is close to the resources that are concentrated downtown, on the hill, in the CD etc. You could get more for the money a few miles further out but reliable transportation and local resources become a problem. Besides, it would rather have the look of shipping them off somewhere other than “here,” wouldn’t it? And as someone else points out the city might have gotten a decent price on them all things considered.
I agree with some of the other comments here. Capitol Hill actually has many of the services needed by food insecure, unstable mental health, and addiction issues. I also prefer to live in a diverse neighborhood with a wide range of incomes. It seems to me that neighborhoods remain more walkable with this kind of diversity.
They will run out of money before you run out of homeless
The best we can do is try.
I love this, it’s going to be expensive, but I’d rather this then having to chase homeless addicts off my property where my child sleeps.
I suspect, sadly, we’ll have both some additional folks housed and also more folks taking their place outside.
did I read it wrong? I only count 6 apartments of low income
By the graphic above, it is 165 units.
That $50M to purchase those buildings could have paid for about 20 years of rent at $1,500 for that many people. Now the City has to manage the buildings, cover utilities and maintenance costs.
Mircohousing has always been the SROs of the future. The future is now…
Can you point out the places on Capitol Hill that are currently renting for $1,500 and guaranteeing $1,500 for 20 years?
Asking for a friend.
You see no increase in rents over the next twenty years? I like your world.