Who Lives In Affordable Housing? A Person, Not A Number
Communities have long devoted considerable resources to attracting trophy developments for the jobs, tax revenue and prestige they can bring. Increasingly, though, they are finding themselves forced to address what these projects can inadvertently take away — namely, affordable housing.
That is the case in Arlington County, Virginia, home to Amazon’s HQ2 campus. While HQ2 is a major feather in the region’s cap, stakeholders there, including county officials, developers and Amazon itself, want to preserve housing for residents who are at risk of being displaced by new market-rate and luxury developments.
D.C.-based developer Jair Lynch Real Estate Partners recently took ownership of the largest community of privately owned affordable housing in the county. It plans to maintain the community’s historic role as an island of middle-class housing in a fast-developing area.
“Our company has always understood the ramifications that income inequality can have on communities,” said Anthony J. Startt, director of investments for Jair Lynch. “As developers, we strive to shape the built environment, but we have always been in a position to act as community stewards and to create better places for people to prosper.”
As of 2022, Jair Lynch is the steward of several developments in the mid-Atlantic area, with its most notable recent acquisition being Barcroft Apartments. The 1,334-unit apartment complex located on 60 acres in Arlington County has provided naturally occurring affordable housing since 1939.
The developer said it intends for Barcroft to continue to play that important role and has pledged to maintain affordable rents at Barcroft of up to 60% of the area median income for 99 years. Startt, however, noted that projects like this transcend statistical formulas like AMI.
“We've seen a change in the last five years where there is greater attention paid to affordable and attainable housing by a broader spectrum of the general public,” he said. “When we talk about affordable housing, we always refer to ‘60% of AMI’ or ‘80% of AMI.’ But now we’re starting to recognize AMI not as a number, but as a person.”
In Arlington County, these people can include teachers and civil servants who might be priced out of the housing market as HQ2 and other high-profile developments raise property values.
“There is such an obvious need for affordable housing, and people have started to realize that mixed-income communities are a good thing,” said Steve Gilbert, senior vice president of marketing and business development with Gates Hudson, which will manage Barcroft for Jair Lynch. “There was a NIMBY attitude in years past, when communities really did not want to have affordable housing in the neighborhood. Now, you can contrast that with the Arlington County Board’s embrace of Jair Lynch’s plans for Barcroft. Their attitude has been: ‘What can we do to support you?’ That never used to happen.”
One way the county is supporting Jair Lynch’s acquisition of the property is with a $150M loan. In addition, Amazon committed a $160M low-rate loan to the project.
Startt said the participation of stakeholder organizations is essential to the success of a project like Barcroft, where traditional tools such as Section 8 vouchers or low-income housing tax credits either might not apply or move too slowly.
“Those tools are incredibly important but they were not necessarily the right solutions at the time for something like Barcroft, given its size, complexity and the speed at which we had to move in order to acquire this,” he said. “Having the commitment of both a private sector organization like Amazon and a public sector organization like Arlington County, who were both able to move extremely quickly, was absolutely crucial.”
Jair Lynch has embraced this segment of the housing market, investing more than $1B in attainable housing since 2019. Barcroft is its largest acquisition in this sector.
The company is not the only developer active in the affordable sector, and still more developers might be tempted to enter it. But Startt cautioned that this work requires a serious level of commitment.
“If you're getting into affordable housing because it's trendy or just for the bottom line, people will quickly see through that,” he said. “You should only be in this space if you really are committed to affordable housing and are going to do it right. Because otherwise, the entities that you really need on your side — the lenders, investors, local governments and affordable housing advocates — will quickly see that you're not truly committed to making it work.”
A developer who is new to affordable developments might be tempted to cut corners to reduce costs. But Gilbert said that residents of affordable housing deserve the same level of care and consideration as people who live in more expensive developments.
“As the management partner, our job first and foremost is to take care of our residents at Barcroft and communicate what we want to accomplish: to make sure that everybody has access to safe and affordable housing,” he said. “We're not there to displace anyone.”
One way to accomplish this, Gilbert added, is to get to know the residents and learn their goals and concerns. It is also important to keep in close contact with other stakeholders, he said.
“I'm really proud of the relationship built between Gates Hudson and Jair Lynch and the county of Arlington," Gilbert said. "We meet regularly to talk about our progress on attaining what we promised we would deliver to the residents of the community, and how we can best coordinate services mutually between public and privately available resources. This teamwork is something that I didn’t used to see in this industry, and it's great to see the commitment to residents and to preserving affordable housing.”
Gilbert called the Barcroft experience a "case study in how private enterprise and local government can partner to improve a community."
This article was produced in collaboration between Studio B and Gates Hudson. Bisnow news staff was not involved in the production of this content.
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