Affordable Rentals Getting Scarcer in Chapel Hill and Carrboro

Molly De Marco's picture

Tonight, the Chapel Hill Town Council received a report from the developers of what once was the Colony Apartments and will now be called The Park at Chapel Hill (a mixed use development). Colony Apartments was one of the only locations of affordable rentals in Chapel Hill, but with this redevelopment that is no longer likely to be the case. With the redevelopment of Glen Lennox in Chapel Hill and the recent purchase of the majority of the units at Abbey Court (now to be called Collins Crossing), affordable rentals may become extinct in Southern Orange County.

This is an issue that Orange County Justice United has been focused on and Tish Galu, Strategy Team Chair for Justice United, made the following statement at the council meeting:

Before you tonight are plans for the development of Colony Apartments – now known as The Park. With this development and plans for Glen Lennox proceeding – the term “affordable” rentals will not apply to anywhere in Chapel Hill.

Justice United members met with tenants of Colony apartments when the new owners took over and the tenants were being pressured to sign new contracts because they were told there may not be a place for them if they did not renew quickly – of course their rent went up over $200/month when they did sign. New procedures were put in place for applying for apartments which you could call, at best questionable practices –The Mayor, his office and your staff were helpful in halting some of this activity but not the increase in the cost of the apartments. Many left because of the pressure, because of the new procedures and many left in the middle ofthe school year which affected families, and many left because they could not pay the new rates.

During 2010 and 2011, JU worked withyour staff to identify affordable housing needs and you adopted an affordable housing strategy which you are working on implementing. All involved could see from the data we had that Colony and Glen Lennox were two of very few places left that could fall into “affordable” rental housing.  Justice United members understand as well as the committee that worked on this – that CH cannot provide all affordable housing solutions.

Maybe it is time to make the University and the hospital accountable by paying a living wage for their hourly employees as you and Carrboro and the county have attempted to do? Maybe the private sector employers need to pay a living wage as well. Maybe the university needs to provide more housing for students – as we saw that students are taking over many of the previously affordable rentals in the town. Maybe there needs to be workforce housing – more public housing? Maybe developers of rental units can use a model similar to the Home Trust for affordable home rentals? Maybe we need incentives for developers to build affordable rental units?

Maybe we need all of the above....but in the meantime, affordable rental units are becoming non-existent.  Chapel Hill is changing and how these areas are developed will make a difference in the entire landscape of Chapel Hill.

We need to continue to find solutions together so that those who work in Chapel Hill for the town, the university, the hospital and private sector alike, can chose to live in Chapel Hill –otherwise our residents will not be the diverse population that has made Chapel Hill avery special place to live, work and worship.

Thank you for listening. 

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6 Comments

Molly De Marco's picture

Chapel Hill will lose nearly 200 affordable rentals

Currently, there are nearly 200 affordable rentals at what is now The Park at Chapel Hill - no mention in the concept plan of retaining any of these. Both Empowerment and Justice United highlighted these issues during public comment. Council members Bell, Ward, Storrow, Easthom, and Harrison voiced grave concerns about this loss of affordable housing with nothing in the concept plan addressing affordable housing options at all.Council member Storrow suggested payments-in-lieu as a way to address affordable housing here. He and Council member Rich also suggested the developers look to the Glen Lennox plan for idea about affordable housing.

Travis Crayton's picture

I think it's also worth

I think it's also worth pointing out that Council member Czajkowski made some fairly insightful remarks about the fact that while Chapel Hill has expressed a commitment to affordable housing, the town hasn't developed many concrete strategies for ensuring access, especially with rental units. My concern is that we're going to continue to see development projects like this that don't include affordable housing, and if the town doesn't work to set a real plan regarding affordable housing now, it's going to be way too late in the near future to address this major crisis in our town.The developer got numerous comments back from Council, and I hope we will see affordable housing - along with the other fixes suggested by Council - in the next draft. This is a major redevelopment in an area of town slated for a complete overhaul, and if The Park will committ to affordable housing and set a standard for others, we could be looking at a much better situation (but without more prodding from Council, I'm not entirely optimistic that we'll see that). 

Affordable Housing Policy One Site Plan at a Time Doesn't Work

First, I'm glad to see someone putting this issue on the table. Thanks to Molly and OCJU for doing so. I don't think we are going to be successful in improving the housing affordability situation until we get rid of the idea that new development site plan review and inclusion of affordable units/payment in lieu-- should be the primary strategy to get affordable units into the local real estate market.The hard truth is that the number of existing units that change hands for owners or renters in a given year in Chapel Hill / Carrboro dwarfs the number of new units introduced, even in a year with a large number of units added by local standards. The price per square foot for this vast group of units, probably 99% of those in the community, are governed by the law of supply and demand in the local real estate market, and the biggest gains in affordability to modest-income citizens will appear when public policy makes THESE units more affordable, not simply create a handful of owner-occupied units that enter the OCHLT ecosystem each year. Demand to live in this area is very high, and with the supply being almost static, the outcome is higher prices at a base level and larger year-over-year rent increases than in other nearby communities such as Durham, Morrisville, or Alamance County.   If you want to provide more access to low-income residents to the existing unit base for RENTALS, if you're a policymaker, you have fundamentally two choices:1. You decide to accept that supply is relatively fixed, and then attempt to move public subsidies in the direction of low-income individuals to help them meet market rates. This is essentially what federal Section 8 housing funds do. I'm not sure what the local government equivalent is, but if such an approach exists elsewhere in the US, that's one possibility to study. You'd also need to figure out how much property taxes would need to increase locally to fund the mechanism.2. You decide to permit more units in the community to increase the supply of units, thereby making them less rare and less costly, using new supply to satisfy demand. This situation is about to hit affordability-problem plagued Washington, DC, and offer relief to renters. How many units would begin to lower rents locally?  I'm not sure, but I'll guess it's several hundred to one thousand units for several years in a row. If this option was pursued, we would see filtering in the real estate market as new rentals attracted some of those currently in existing rentals, freeing up space for lower-income individuals to compete for those spaces with less or without subsidy. So if affordability is more important to you than say, aesthetic preferences of current residents, then this perspective would tell you to build Charterwood or something like it, and then several more somethings like it, even if there were no affordable units in the site plans- because the additional units would slow rent increases compared to wage increases. Of course this issue is more complicated when we're talking about redevelopment of property that currently hosts modest rents across a large number of units like Colony Apts or Abbey Court.  While redevelopment might help expand supply in a way that suppresses long-term rent growth across the entire existing property base, the immediate impact is the pricing out or displacement of dozens or even hundreds of low-income residents, which puts policymakers in a challenging position.To me, this begs an obvious question: how many additional units would the developer of Colony Apts need to build to accommodate every existing family in a new unit at a similar rent (say no more than 5% above current) on site, and would the town be willing to support that level of development?  

Why not expedite the permitting process for affordable housing

Rather than use the permitting/zoning review process for luxury properties to express concerns about affordable housing, Chapel Hill and Carrboro should expedite permitting/zoning for projects that feature affordable housing.For example, the town of Chapel Hill owns several downtown parking lots that could be sold to developers who will build affordable housing and lease part of the (preferably underground) parking deck to the town.  The answer to affordable housing is to build more housing, and the best place to add more housing is in downtown Chapel Hill and Carrboro.

Travis Crayton's picture

Speaking of DC

Here's a well-timed post about DC's Inclusionary Zoning ordinance that's worth a read.DC's linking density to affordable housing to convince developers to include affordable units. Given that The Park is an incredibly dense development and Chapel Hill has a clear need to develop denser, maybe this is a potential policy solution that could be replicated here? 

Roscoe's picture

Once again, with feeling.....

damn.....i wrote a whole long thing and it disappeared.......lucky you. Essence:We've had all this discussion many times before...the 70's 80's and 90's. Nothing has changed because the laws of supply and demand rule. Developers borrow money to do their thing. The banks will not lend for anything other than top dollar price/rent. In this bad economy there is minimal interest by our citizens in paying for someone else's housing.Affordable housing has been my top civic interest since the "boom" here in the early 70's. I'm very pro affordable housing......how will we get any?I agree that a big reward (expedited permit process) would be the best tool for attracting developers and banks, but not for interesting them in low or controlled rents.Too bad that the good times of big HUD grants are gone with the Republican ethnic cleansing of federal and state programs. If we could just get the developers to build affordable housing and then have grants to subsidize rent and repair.But before you get a deal like that, keep in mind that every density development in CH is opposed by the NIMBY crowd. Would council have the backbone to vote over that loud bunch (who would occupy endless hours of hearings with the same old highly articulate blather and threats)? I would hope so, but the most common path would load the applicant with page after page of stipulations making affordable impossible. I have nothing against citizens trying to protect their neighborhoods from harm.....but underneath they do not want those affordable people near their homes (see IFC Community House) including teachers, police, fire fighters or town employees, let alone the homeless.