The Centre City Development Corp. continues to churn out millions of dollars for affordable housing both in and outside of downtown, but there could be clouds on the subsidized horizon.
The problem, as noted by the San Diego Housing Commission, is that Proposition 46, a $2.1 billion bond measure that has brought $68 million in affordable housing funds to this region during the past three years, is slated to run out of money by the middle of next year.
While gap financing is considered, CCDC is currently subsidizing 236 affordable units under way within downtown, and 406 subsidized units under construction outside downtown's boundaries. CCDC has directly overseen the development of 2,351 affordable units in and outside downtown between 2000 through June 2005. That represented 21 percent of the 11,326 units constructed during that period.
The largest CCDC-funded project going up with an affordable housing component is an East Village development called Island Market Centre. It has both market rate and affordable housing.
The projected $59 million, 60,000-square-foot, 212-unit project will be on the block bounded by 13th and 14th avenues, Market Street and Island Avenue. The development cost translates to $278,301 per unit.
The northern half of the Oak Shelter Systems LLC project is planned for 131 market-rate, for-sale condominiums and 33 affordable for-sale units that will be subsidized to the tune of $179,000 per unit. The subsidy is an expensive one, especially since it is still possible to purchase apartment complexes for less than that per-unit figure.
When asked why the subsidy is so high, Dale Royal, CCDC senior project manager, said one reason is the 12- to 14-story project is being constructed out of steel and concrete instead of stick built, making it much more expensive.
Also, the land costs downtown range anywhere from $300 to $500 per square foot, and even more in some cases.
"The main variables are land costs, construction costs and any soft costs ... You always want to make sure when you are thinking about a subsidy that you consider the type of product being created," Royal said. "And you have to think of the income level."
The 33 affordable units would be made available to households making up to 120 percent of the median income, or about $61,000 for two people. They would pay roughly $180,000 to $217,000, about half the going rate for one- and two-bedroom condominiums in that part of downtown. In fact, many of the market-rate units are expected to sell for more than $420,000.
The southern half of Island Market Centre will have 48 rental apartments, including nine affordable units. There is no subsidy in this portion of the project, slated for completion in March 2007.
Lillian Place, located along the south side of J Street between 14th and 15th avenues, will have 74 units. That Wakeland Housing project will have a $99,000 per-unit subsidy and all of its units will be affordable.
The estimated rent range at Lillian Place is $329 to $1,155 for a one-bedroom, $393 to $1,383 for a two-bedroom and $450 to $1,595 for a three-bedroom unit.
The remainder of the affordable downtown projects identified by CCDC were either single-room occupancy hotel units or units for people with special needs.
Whereas CCDC is paying $19.27 million for affordable projects in the pipeline downtown, it is paying $29.74 million to help fund at least six affordable housing projects outside downtown.
CCDC, whose primary purview is review projects downtown, is spending more money on affordable projects outside its core area, Royal said, because the City Council in recent years has asked the redevelopment entity to "spread the wealth" to other communities such as City Heights and the College area. There are also more sites elsewhere and it is also considerably cheaper to build outside of downtown.
The Southeast Economic Development Corp., in conjunction with CCDC and other entities such as the San Diego Housing Commission, is planning a development of perhaps 200 units on nine acres at Highway 94 and Euclid Avenue. CCDC has invested $6.17 million thus far on land acquisition costs. The amount of the subsidy has yet to be determined.
Plans are also moving ahead for City Heights Square, a 150-unit affordable senior housing project at 43rd Street and Polk Avenue that has a $7.1 million investment from CCDC. This project carries a per-unit subsidy of $47,000, demonstrating the enormous differences in subsidies in and outside downtown.
City Heights Square will have studio and one-bedroom units for very low-income seniors expected to rent for just $310 to $555. The developers are Chelsea Service Corp. and Senior Community Centers. Completion is slated for the summer of 2007.
The Talmadge Senior Village Apartments, in the process of being completed, is a 91-unit project that received $3.6 million in CCDC monies plus another $3.3 million in local subsidies.
The development by Southern California Housing and San Diego Community Housing at 5252 El Cajon Blvd. in the College area has rents ranging from $339 to $578.
All told, the San Diego Housing Commission, which has a hand in each of these projects, says there are 2,152 affordable housing units for rent or for sale now in the pipeline or under way. Another 2,320 rental and for sale units have been proposed citywide.