Real Estate's Achilles Heel
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Yesterday, we mentioned Mayor Walsh's plan to cope with the dearth of mid-market and affordable housing created by the real estate boom, but it's so ambitious, it's worth a deeper look. The mayor’s housing chief Sheila Dillon (left, with the Asian Community Development Corp's Janelle Chan) says local developers were an important part of the task force that formulated the $21B plan to stimulate the production of 53,000 new housing units by 2030. Now, the Mayor's team is doing environmental testing and design work to determine which of the 300-city owned lots will work. It's also mapping private and public land around transit stops.
Affordable sites that can support significant growth could be up-zoned; the city department of neighborhood development is working with the BRA to identify appropriate locations to allow greater density, more height, and new uses. (Perfect example: land zoned light industrial near a t-stop.) The Walsh Administration also is willing to tackle some sacred cows. For one, it's considering an increase in rents for affordable housing that's set aside in market rate developments, Sheila says. Mayor Walsh, who won election with strong union support, is discussing with building trades the possibility of lowering labor rates.
The Walsh housing task force is working with the city assessor and eventually the state, to investigate the possibility of not charging taxes during two years of construction and charging a reduced rate for up to three years while the building is leased and stabilized. To build and preserve affordable housing for low income households, the plan calls for the city to raise an additional $20M/year to increase its budget from $31M to $51M. At the end of this month, there will be a new round of public funding for affordable housing. How the administration spends it will reflect its new housing policy, Janelle says.
The plan is data-driven and balances what government can do with what private developers need to boost affordable housing production by 65%, says Walsh housing task force member The Community Builders CEO Bart Mitchell (yesterday at the ribbon cutting for TCB's $46M mixed use multifamily development on Chicago’s South Side, Shops and Lofts at 47). Now, the "great conversation" is about where to build, and Bart says developers will work with the City to ID sites. But do it fast; Bart says Boston should take advantage of the economic and population growth before this great boom expires.