delling on density eploring affordable ......uc berele icit 2015 m arian wolfe, phd, scott chilberg,...
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UC BERKELEY [IN]CITY 2015 Marian Wolfe, PhD, Scott chilberg, holly clarke, SohaM DheSi, eleanor fiSher, rebecca PynooS nicola Szibbo, PhD, Sonia-lynn abenojar, eric anDerSon, juStin kearnan
DWELLING ON DENSITY / EXPLORING AFFORDABLE HOUSING DEVELOPMENT IN THE CITY OF BERKELEY
THE PROBLEM
Housing Trust Fund
$$
$
Development fees
Other sources
CountyState
Federal
Affordable housing in Berkeley is produced in two ways:
by private developers mixed into market-rate projects, and
through government-funded nonprofit development projects.
Funding for the latter comes from fees on private development leveraged with county, state, and federal sources. All of these funding sources have declined in recent years.
Berkeley is considering a local policy change that would grant a “density bonus” to developers in exchange for paying fees that would be used to fund affordable projects.
The Bay Area’s population is exploding. With an expected population growth of 24% by 2040, and pursuant to California Senate Bill 375, Berkeley has adopted a high-density, transit-oriented growth-management strategy around identified Priority Development Areas (see map above). With most of its land already developed, Berkeley is now facing the complicated task of accomodating “its share” of regional population growth while expanding availability of affordable housing.
How should Berkeley expand the supply of affordable housing using the density bonus plan?
Downtown Berkeley/ Downtown Area Plan
San Pablo Avenue/ West Berkeley Project
South Shattuck/ South Shattuck Strategic
Telegraph Avenue/ Southside Plan
Adeline Street/ South Shattuck Strategic Plan
University Avenue/ University Avenue Strategic Plan
BAY AREA
Priority Development AreasBay Area Plan
0 1.20.3Miles
PRIORITY DEVELOPMENT AREAS
UC BERKELEY [IN]CITY 2015 Marian Wolfe, PhD, Scott chilberg, holly clarke, SohaM DheSi, eleanor fiSher, rebecca PynooS nicola Szibbo, PhD, Sonia-lynn abenojar, eric anDerSon, juStin kearnan
DWELLING ON DENSITY /
$ $
INCOME BRACKETS Income brackets are defined in relation to Area Median Income (AMI)
Extremely Low Income Very Low IncomeLow Income
<30 % AMI 31 - 50 % AMI 51 - 80 % AMI
Residential density is defined as the number of dwelling units per acre (du/ac)
FLOOR AREA RATIO [FAR]Ratio of total floor area of a structure to the total square footage of its parcel
LOT USE
AFFORDABILITYDENSITY
DENSITY BONUSAn increase in the number of residential units on a parcel beyond what the zoning ordinance allows
ZONING CONCESSIONSReductions in certain zoning regulations, such as:
100% Affordable Housing
Inclusionary Housing
Units that are reserved as affordable housing. Rents for below-market-rate units are set as 30% of the income of target tenant group (see “Income Brackets” table to the right).
100% AFFORDABLE HOUSING
ASSOCIATED PROBLEMSINCLUSIONARY HOUSING
Housing Trust Fund
Parking spaces
Parking spaces
Parking level entrance
4 - 10 du/ac
20 - 40 du/ac
50 - 100 du/ac
Single Family Dwelling
Townhouses
Apartments
Below market rate (BMR) units
Residential affordability is defined as 30% or less of household income spent on rent
BELOW MARKET RATE (BMR) UNITS
DEFINITION OF KEY CONCEPTS
open space parking setbacks height limits
Services
Lack of community Peripheral location
“Ghettoizing” the poor
Lengthy build process
No in-building services
Less affordable
Building
UC BERKELEY [IN]CITY 2015 Marian Wolfe, PhD, Scott chilberg, holly clarke, SohaM DheSi, eleanor fiSher, rebecca PynooS nicola Szibbo, PhD, Sonia-lynn abenojar, eric anDerSon, juStin kearnan
DWELLING ON DENSITY / BERKELEY DEMOGRAPHIC OVERVIEW
20101995
2014
2000
SNAPSHOT OF BERKELEY DEMOGRAPHICS
BERKELEY OVER TIME
ToTal PoPulaTion Median age 27% of Berkeley’s Population is 18-24 yrs old
Workforce eMPloyed by uc berkeley Median houshold incoMe average household size renTer / hoMeoWner households
POPULATION GROWTH NUMBER OF UNITS BUILT(In Buildings with 5+ Units)
% OF INCOME SPENT ON HOUSING
COMMUTER POPULATION
11, 197
52,330
27,176
AT A GLANCE
1970 1980 1990 2000 2010 2013
116,716
103,328 103,137 103,027
112,914
116,768
WhiteAfrican American
Asian, Native Hawaiian/ Pacific Islander
Two or More Races
Hispanic Latino
55%
10%
19%
5%11%
BREAKDOWN BY RACE
1960s 1970s 1980s 1990s 2008
4027
2125
578 573
1150
2010 Census Data, Berkeley Daily Planet
2010 Census Data
Workers commuting into Berkeley daily
Work & live in Berkeley
Berkeley residents working elsewhere
Data from LEHD
City of Berkeley - Consolidated Plan for Housing & Community Development (2010)Berkeley Housing Element (2009)
2010 Census Data, 2015-2023 Berkeley Housing Element
Housing in Berkeley has become more expensive over time; construction has declined while demand, especially from students, has increased.
48% of commuters to Berkeley make <50% of AMI
36% of Berkeley residents make <50% of AMI
UC BERKELEY STUDENT POPULATION GROWTH
37,581
Census Data, American Community Surveys
Census Data
UC Berkeley
10 15 20 23 27 30 33 37 40 45 50
¯
70,000-140,000
30,000-70,0000
0-5000
5000-10,000
10,000-15,000
15,000-30,000
DENSITY
29,662
116,76831 yrs
23%$61,960
2.1759% / 41%
UC BERKELEY [IN]CITY 2015 Marian Wolfe, PhD, Scott chilberg, holly clarke, SohaM DheSi, eleanor fiSher, rebecca PynooS nicola Szibbo, PhD, Sonia-lynn abenojar, eric anDerSon, juStin kearnan
DWELLING ON DENSITY /
1979
2008
2009
2011
2013
2015
1990
California passes Senate Bill 375
California Superior Court effectively bans Inclusionary Zoning for rental residences
Berkeley creates Housing Mitigation Fee
Association of Bay Area Governments passes Sustainable Communities Strategy
Changes proposed to Berkeley density policy
Berkeley creates Housing Trust Fund
California passes Density Bonus Law
STATE DENSITY BONUS LAW
BERKELEY’S CURRENT PATHS TO AFFORDABLE HOUSING
PROPOSED CHANGES
DISINCENTIVESReduced rent from BMR units
Density bonus granted
% of total units in project that are reserved for:
DISINCENTIVESPer-unit mitigation fee
INCENTIVESDensity bonus
Mitigation fee exemption
INCENTIVES100% market- rate rents
Berkeley City Council is reviewing a proposal that, if passed, would grant a 35% density bonus to developers who pay the housing mitigation fee as well as a density bonus fee.
moderate income
low income
very low income
10%
5%10%
11%20%
5%
10%
15%
20%
25%
30%
35%40%
California’s density bonus policy reduces Berkeley’s discretionary control over zoning and density, and gives developers incentives to include affordable housing on-site. The proposed changes could create an enticing local alternative.
POLICY BACKGROUND
Grants a % increase above local limits on the allowed number of residential units for a project along with two zoning concessions in exchange for inclusion of below market rate (BMR) units. Local governments cannot deny a density bonus to proposed projects that meet the state’s criteria.
10% very low income
50% accessible for seniors
20% low income
Housing Trust Fund
Housing Trust Fund
$28,000
$28,000 $10,000
35%density bonus
mitigation fee per unit
per unit fee per base unit fee for the developer for affordable housing
INCLUSIONARY
100% AFFORDABLE
+ &$
UC BERKELEY [IN]CITY 2015 Marian Wolfe, PhD, Scott chilberg, holly clarke, SohaM DheSi, eleanor fiSher, rebecca PynooS nicola Szibbo, PhD, Sonia-lynn abenojar, eric anDerSon, juStin kearnan
DWELLING ON DENSITY / COMPARISONS: SAN FRANCISCO & SANTA MONICA
SAN FRANCISCO
SANTA MONICA
SquARE MIlES POPulATION MEdIAN INCOME RENTERS/ OwNERS % Of RENTERS SPENdINg >30% Of HOuSEHOld INCOME ON RENT
47837,442$75,604
65% / 35%38%
884,084
$71,40072% / 28%
41%
AFFORDABLE HOUSING POLICY Residential developers building 10 + multifamily units must choose from the following options:
Mayor’s Office of Housing and CommunityDevelopment
Build affordable housing off-site, within 1 mile radius of market rate projectInclude 12% BMR
DEMOGRAPHICS
AFFORDABLE HOUSING POLICY Residential developers building multifamily housing must choose from the following 4 options:
Housing Trust Fund
Build affordable housing off-site, within .25-mile radius of market rate project
Donate, sell, or option land to city or non-profit hous-
SquARE MIlES POPulATION MEdIAN INCOME RENTERS/ OwNERS % Of RENTERS SPENdINg >30% Of HOuSEHOld INCOME ON RENT
San Francisco and Santa Monica both have instituted housing policies not present in Berkeley, namely setting density standards and a radius requirement for off-site affordable housing.
DEMOGRAPHICS DENSITY STANDARDThe San Francisco planning code standards outline maximum dwelling unit density based on zoning district and building use.
DENSITY STANDARDThe Santa Monica municipal code outlines maximum dwelling unit density based on zoning district and building use.
Inclusionary units
UC BERKELEY [IN]CITY 2015 Marian Wolfe, PhD, Scott chilberg, holly clarke, SohaM DheSi, eleanor fiSher, rebecca PynooS nicola Szibbo, PhD, Sonia-lynn abenojar, eric anDerSon, juStin kearnan
DWELLING ON DENSITY /
GEOGRAPHIC DISTRIBUTION ECONOMIC DISTRIBUTION
5 - 1,407 1,407 - 5,616 5,617- 12,00012,001 - 22,45022,450 - 35,076
BERKELEY POPULATION BY INCOME BRACKET
AFFORDABILITY LEVELS These bar graphs show the number of BMR rental units in Berkeley affordable to low, very low, and extremely low income households, broken out by method of production
# LOW-INCOME UNITS
# EXTREMELY-LOW- INCOME UNITS
# VERY-LOW-INCOME UNITS
JOB DISTRIBUTION (jobs per sq mi)INCLUSIONARY
HOUSING UNITS MAPPED
100% AFFORDABLE HOUSING UNITS MAPPED
AVG. MARKET RENT*
HOUSEHOLD INCOME NECESSARY TO AFFORD AVG. MARKET RENT
2010 2014
INCOME DISTRIBUTION
54% of Berkeley renters are overpaying for rent. While sheer production of housing is necessary, it’s important to look at the distribution of affordable housing, both geographically and economically, to ensure that that production is equitable. Below- market-rate units should be available within Berkeley’s economic centers, and should meet the needs of the lowest income groups.
15,00020,00025,00030,000
40,000
50,00075,000100,000
35,000
45,000
DISTRIBUTION OF AFFORDABLE HOUSING
33 units
168 units
3,650
7,865
# of households
4,305
126 units
255 units 248 units
0 units
9,565Extremely Low Income
Very Low Income
Low Income
Moderate & Upper Income
0 to 19 units
20 to 39 units
0 to 19 units
20 to 39 units
40 to 59 units
60+ units
100% affordable housing, in contrast to inclusionary units, is distributed outside job centers and provides more deeply affordable units.
$1,765
$70,600
$2,171
$86,840*3-person, 2-bedroom
MODERATE & UPPER INCOME
LOW INCOME
VERY LOW INCOME
EXTREMELY LOW INCOME
Berkeley 2010 & 2015 affordable housing nexus studies
Job distribution data from LEHD, income distribution data from 2013 ACS
2007-2011 American Community Survey data
UC BERKELEY [IN]CITY 2015 Marian Wolfe, PhD, Scott chilberg, holly clarke, SohaM DheSi, eleanor fiSher, rebecca PynooS nicola Szibbo, PhD, Sonia-lynn abenojar, eric anDerSon, juStin kearnan
DWELLING ON DENSITY /
There is significantly better access to neighborhood amenities, public transit, and retail in the areas with a high concentration of inclusionary housing than in the areas with a high concentration of 100% affordable projects.
NEIGHBORHOOD AMENITIES
INCLUSIONARY UNITS
TRANSIT
WALK, BUS, BIKE SCORES
WALK, BUS, BIKE SCORES
LAND USE
Shat
tuck
Ave
MLK
Jr
Way
Virginia St
Blake St
University Ave
Hearst Ave
Bancroft WayEducation
Bus RoutesBart
Community Center
Park
Grocery
Hospital
Cultural Institution
Cultural Institution
InstitutionResidential UnitsCommercialMixed Use ResidentialRecreational
959869
AMENITIES AREA
Shat
tuck
Ave
MLK
Jr
Way
Virginia St
Blake St
University Ave
Hearst Ave
Bancroft Way
AFFORDABLE UNITS
TRANSIT
LAND USE
M.L
.K Jr
Way
Sacr
amen
to S
t
San
Pabl
o A
ve
Alcatraz
Russel St
Ashby St
Dwight Way
Education
Bus Routes
Institutional Residential UnitsCommercialMixed Use ResidentialRecreationalMixed Use Light Industrial
Bart
Community Center
Park
Grocery
Hospital
8859 99
AMENITIES AREA
M.L
.K Jr
Way
Sacr
amen
to S
t
San
Pabl
o A
ve
Alcatraz
Russel St
Ashby St
Dwight Way
UC BERKELEY [IN]CITY 2015 Marian Wolfe, PhD, Scott chilberg, holly clarke, SohaM DheSi, eleanor fiSher, rebecca PynooS nicola Szibbo, PhD, Sonia-lynn abenojar, eric anDerSon, juStin kearnan
DWELLING ON DENSITY /
INCLUSIONARY HOUSING
100% AFFORDABLE HOUSING
Ashby Lofts (54 Units)
Communal Outdoor Courtyard/ Terrace
Computer Work Space
On-Site WorkshopsHelios Corner (80 Units)
“ARTISTS THRIvE IN lIvE/wORK lOTS AT 800 HEINz AvE.” - The Berkeley Daily Plant, August, 2005Margaret Breland
Homes (28 Units)
Wheel-Chair Accessible
“IT OffERS MORE THAN juST AN APARTMENT HOME, IT OffERS A wORRy-fREE lIfESTylE.” - HARRIET TuBMAN TERRACE wEBSITE
Workout FacilitiesActon Courtyard (70 Total Units, 20 BMR)
Washer-Dryer In-Unit
Berkeley Central(118 Total Units, 23 BMR) Pet friendly
Allston Place(60 Total Units, 12 BMR)
Communal Outdoor Courtyard/ Terrace
In-building Access to car-share services
“SET yOuR HOME APART fROM THE REST”- HIllSIdE vIllAgE APARTMENTS
[wE PuT AN] EMPHASIS ON HIgH-quAlITy dESIgN THAT lOOKS lIKE A MARKET-RATE BuIldINg- SAHA HOMES
“OuR MISSION IS TO CREATE ANd PRESERvE AffORdABlE HOuSINg...TO BuIld COMMuNITy ANd ENRICH lIvES” - RCd HOuSINg
“wE gO TO gREAT lENgTHS dESIgNINg AMMENITIES ANd CHOOSINg lOCATIONS THAT PuT EvERyTHINg wITHIN REACH.” - AvAlON BERKElEy
“A HOME THAT SuITS yOuR PERSONAl NEEdS” - EquITy RESIdENTIAl (gAIA BuIldINg)
Both emphasize clean, modern designs.100% affordable projects put a strong emphasis on empowering residents through community activities, while inclusionary buildings focus on giving residents access to services on a more individual level.
IN-BUILDING AMENITIES
BUILDING TYPOLOGIES
BUILDING TYPOLOGIES
AMENITIES & SERVICES
AMENITIES & SERVICES
QUOTES
QUOTES
UC BERKELEY [IN]CITY 2015 Marian Wolfe, PhD, Scott chilberg, holly clarke, SohaM DheSi, eleanor fiSher, rebecca PynooS nicola Szibbo, PhD, Sonia-lynn abenojar, eric anDerSon, juStin kearnan
DWELLING ON DENSITY /
SCENARIO EVALUATION
CONCEPT-TO-OPERATION TIMELINE
50-unit building
SCENARIO A:
SCENARIO B:
PRODUCTION OF AFFORDABLE HOUSING
INCLUSIONARY HOUSING
100% AFFORDABLE HOUSING
Meets 10% BMR unit req.
Pays $1.4 million ($28,000/unit) to city
5 BMR units
14 BMR units
A typical affordable housing project costs $350,000-$400,000 per unit to build
Funding sources:
20-25% 75-80%etc.
$100,000 of city funding produces 1 unit of affordable housing
It takes more time to build 100% affordable housing projects; however, you get more affordable units per development with that approach.
I. ConCept II. pre-Development III. Development Iv. ConstruCtIon v. operatIon
I. ConCept & seCurIng FInanCIng II. pre-Development III. FInal DesIgn Iv. ConstruCtIon v. operatIon
3.5 - 8 years
3 - 6 years
UC BERKELEY [IN]CITY 2015 Marian Wolfe, PhD, Scott chilberg, holly clarke, SohaM DheSi, eleanor fiSher, rebecca PynooS nicola Szibbo, PhD, Sonia-lynn abenojar, eric anDerSon, juStin kearnan
DWELLING ON DENSITY / HYPOTHETICAL COST & REVENUE ANALYSIS
PROPOSED DEVELOPMENT:
IMPLICATIONS FOR AFFORDABLE HOUSING
Scenario C, reflecting the proposed policy change, produces more units in aggregate while charging higher fee costs to developers. However, the resulting development has the greatest capitalized value after fees are considered of the three scenarios.
Pay mitigation fee?
Seek 35% density bonus?
Include BMR units?
FEESANNUAL NET REVENUES
CAPITALIZED VALUE NET FEES*
$1.4 million one-time mitigation
fee
$0
$1.9 millionone-time mitigation
& density bonus fees
* At a capitalization rate of 6% (equal to that used in the 2015 Nexus Study)
scenario aCurrent policy: Pays mitigation fee
scenario bCurrent policy: Builds on-site BMR housing
scenario cProposed policy: Pays mitigation+ density bonus fees
Housing Trust Fund
$1.4 million
$1.9 million
This is a hypothetical analysis of the costs a 50-unit proposed development might incur related to affordable housing requirements under 3 scenarios. Scenarios A and B look at the current density bonus policy, and Scenario C looks at the proposed changes.
2124 Bancroft WayBANCROFT APARTMENTS
$1,563,000on 50 market-
rate units
$1,945,776on 62 market- rate & 6 BMR
units
$2,110,050on 68 market-
rate units
$24,650,000
$33,267,500
$32,429,600
Housing Trust Fund
UC BERKELEY [IN]CITY 2015 Marian Wolfe, PhD, Scott chilberg, holly clarke, SohaM DheSi, eleanor fiSher, rebecca PynooS nicola Szibbo, PhD, Sonia-lynn abenojar, eric anDerSon, juStin kearnan
DWELLING ON DENSITY / LOOKING AHEAD
Services
Proposed market-rate development
Proposed 100% affordable housing project
The lack of community issue was qualitatively supported, but needs further research.
Spatial analysis shows 100% affordable projects are primarily in peripheral locations outside job centers. However, the small city size mitigates this issue.
In-building services exist in both cases, but address different needs.
No noticeable income difference between market-rate and 100% affordable development neighborhoods.
Extremely low income housholds are underserved by inclusionary housing. Moderate income households are underserved by both due to structure of policies.
100% affordable housing projects have a slightly lengthier build process, but result in more affordable units per development.
RECOMMENDATION #1: Conduct a feasibility study of the proposed fee structure and levels, looking especially at the potential to administer the fees on all, instead of just base, units. Also look at possible ways to promote unit production for moderate-income households.
RECOMMENDATION #2: Develop systems for gathering and analyzing data on below-market-rate unit production, location, and affordability to allow for a holistic and adaptive affordable housing strategy.
RECOMMENDATION #3: Create mechanisms for early community engagement between developers and community members around new proposals.
RECOMMENDATION #4: Conduct a study on the effects of high-density developments on neighborhoods and incorporate community education.
SUMMARY OF ANALYSIS
RECOMMENDATIONS
Priority Development Areas
PROPOSED DEVELOPMENTS