NOTES AND REFERENCES
★ The SouthEast Preservation team recently held a webinar reviewing the full toolkit, highlighting how you can use it most effectively, including the interactive financial modeling tool.
i New housing construction has barely kept pace with household growth for the past eight years. According to the Joint Center for Housing Studies, annual construction should be producing 260,000 units more than were produced in 2018 to keep up with demand while maintaining slack for normal vacancies. And while cost-burden rates have been improving among homeowners, renter cost-burdens are rising among most income groups. Nearly one-half of renter households (47 percent) experienced cost- burdens in 2018, and this figure is much higher in some areas of the country. Meanwhile, the United States’ lower-cost housing stock shrunk by four million units since 2011. For more information, see the Joint Center for Housing Studies’ State of the Nation’s Housing (2019): www.jchs.harvard.edu/sites/default/files/Harvard_JCHS_State_of_the_Nations_Housing_2019.pdf.
ii Depending on the market, “lower-income households” may mean different things. This toolkit focuses on low-income households, and particularly low-income renters. The U.S. Department of Housing and Urban Development (HUD) defines low-income as 80 percent of the area median income. This income level is equivalent to $63,750 for a family of four in the Atlanta metro area and $67,750 for a family of four in Miami-Dade County, per HUD FY2019 Income Limits.
iii Additional discussion of the term “NOAH” is available in this working paper from The Reinvestment Fund: www.reinvestment.com/wp-content/uploads/2019/05/Reinvestment-Fund-Policy-Report-Working-Paper-NOAH.pdf.
iv An, B. et al. (2017). Understanding the Small and Medium Multifamily Housing Stock. Report prepared by Enterprise Community Partners, Inc. and USC Price School of Public Policy. Available at https://www.enterprisecommunity.org/resources/understanding-small-and-medium-multifamily-housing-stock-19423.
v Enterprise Community Partners, Inc. tabulation of 2017 American Community Survey (ACS) 1-year microdata. Median renter income was used instead of area median income to focus on the accessibility of rental units for renters.
vi There are about 1.7 million units actively subsidized at the property level in SMMF buildings nationally, which accounts for less than one-quarter of the total SMMF units affordable to households at 80 percent or less of median renter income. Enterprise Community Partners, Inc. tabulation of 2017 ACS 1-year microdata and National Housing Preservation Database.
vii Brennan, M. et al. (2013). Comparing the Costs of New Construction and Acquisition-Rehab In Affordable Multifamily Rental Housing: Applying a New Methodology for Estimating Lifecycle Costs. Center for Housing Policy Working Paper. Available at https://pdfs.semanticscholar.org/5337/abc2544ae5820a1bc92e52ce3d8f6d5fb8f9.pdf and HUD. (2013). “Preserving Affordable Rental Housing: A Snapshot of Growing Need, Current Threats, and Innovative Solutions.” Evidence Matters. Available at www.huduser.gov/portal/periodicals/em/summer13/highlight1.html.
viii This local attention on unsubsidized affordable SMMF preservation is evidenced in a variety of recent planning efforts in Atlanta and Miami, including HouseATL, the City of Atlanta’s Housing Action Plan, Miami Connect Capital, the City of Miami’s Housing Plan and the Miami-Dade County Housing Plan.
ix The median renter income was tabulated from 2017 ACS 1-year microdata and is not equivalent to HUD income limits. HUD income limits include homeowners and are adjusted for household size. The 2017 median renter income in the Atlanta metro area was roughly equivalent to 55 percent of the HUD-defined area median income.
x Enterprise Community Partners, Inc. tabulation of data from the National Housing Preservation Database.
xi The 2017 median renter income in Miami-Dade County was roughly equivalent to 64 percent of the HUD-defined area median income.
xii Community Development Financial Institutions (CDFIs) are mission-driven financial institutions dedicated to expanding economic opportunity through lending and financial services in underserved communities, such as low- and moderate-income neighborhoods.
xiii Enterprise Community Partners, Inc. tabulation of 2017 ACS 1-year microdata.
xiv These factors were derived from a literature review of national frameworks for identifying, evaluating, and prioritizing preservation projects and public policy priorities for preserving housing affordability in Atlanta and Miami.
xv This is particularly true for unsubsidized affordable SMMF properties, as research conducted by the National Trust for Historic Preservation has demonstrated that neighborhoods with a mix of older, smaller buildings also tend to contain more age diversity, woman and minority-owned small businesses, and have greater walkability than areas with newer, larger structures. See Older, Smaller, Better: Measuring How the Character of Buildings and Block Influence Urban Vitality: https://dillonm.io/articles/NTHP_PGL_OlderSmallerBetter_ReportOnly.pdf.
xvi Neither Atlanta nor Miami have explicit public policy priorities around preserving unsubsidized affordable SMMF properties (as of December 2019). There is growing acknowledgement in both cities of these properties’ role in offering diverse housing options and affordability without public subsidy. Miami-Dade County plans to devote more resources to SMMF preservation in 2020 by making funding available through a competitive process to preserve these properties.
xvii Minnesota Preservation Plus Initiative. (2013). The Space Between: Realities and Possibilities in Preserving Unsubsidized Affordable Rental Housing. Available at https://noahimpactfund.com/wp-content/uploads/2016/08/gmhf-space-between.pdf.
xviii Abdelgany, S. (2017). Catching Affordability Where It’s At: Acquisition/Rehab of Oakland’s Unsubsidized Affordable Housing. Available at www.urbandisplacement.org/sites/default/files/images/pr_somayaabdelgany_5.25.pdf.
xix Treskon, M. and Sara McTarnaghan. (2016). Anatomy of a Preservation Deal: Innovations in Preserving Affordable Housing from around the United States. Report prepared for the Urban Institute. Available at www.urban.org/research/publication/anatomy-preservation-deal-innovations-preserving-affordable-housing-around-united-states.
xx The City of Miami and Miami Homes for All. (2019). Connect Capital Miami. Available at www.miamihomesforall.org/connect-capital-miami.
xxi For a detailed discussion of the challenges of financing SMMF properties, see Small Multifamily Rental Property Financing by the Office of the Comptroller of the Currency, U.S. Treasury Department: www.occ.treas.gov/publications-and-resources/publications/community-affairs/community-developments-investments/pub-cdi-may-2015.pdf.
xxii For instance, the New Generation Fund, a revolving loan fund for acquisition and predevelopment, offers up to 120 percent loan-to-value for nonprofit sponsors and up to 95 percent loan-to-value for for-profit sponsors.
xxiii A focus on 5+ units leaves out more than 39,000 units in 2–4-unit properties in Miami-Dade County and nearly 49,000 units in 2–4-unit properties in Atlanta’s five-county region. Enterprise Community Partners, Inc. tabulation of 2017 ACS 1-Year microdata.
xxv For more recommendations on ways to support unsubsidized affordable SMMF preservation in Atlanta, see Preserving Naturally Occurring Housing Affordability in Metro Atlanta Neighborhoods; in Miami, see Miami-Dade County Affordable Housing Preservation Plan.
xxvi In a lending consortium, bankers “pool their risks and resources to address areas of need.” For a detailed discussion of the challenges of financing SMMF properties, see Small Multifamily Rental Property Financing by the Office of the Comptroller of the Currency, U.S. Treasury Department: www.occ.treas.gov/publications-and-resources/publications/community-affairs/community-developments-investments/pub-cdi-may-2015.pdf.
xxvii Ha, H. et al. (2016). “Analysis of Pollution Hazard Intensity: A Spatial Epidemiology Case Study of Soil Pb Contamination.” International Journal of Environmental Research and Public Health, 13(9). Available at www.ncbi.nlm.nih.gov/pmc/articles/PMC5036748/.
xxviii It is important to have your own attorney (separate from that of the seller or lender) when title issues are identified.
xxix Muniz-Stewart, S. The Miami Parking Debate. The Real Deal. Available at https://therealdeal.com/miami/2016/06/15/the-miami-parking-debate.
xxx City of Atlanta Department of City Planning. Atlanta Zoning Ordinance Update: Phase II. Available at www.atlantaga.gov/home/showdocument?id=39209.
xxxi See Section 6.H. of the Atlanta Zoning Ordinance 18-O-1581: http://atlantacityga.iqm2.com/Citizens/Detail_LegiFile.aspx?ID=16064&highlightTerms=Z-18-100.
xxxii Mattera, P. (2006). Breaking the Codes: How State and Local Governments are Reforming Building Codes to Encourage Rehabilitation of Existing Structures. Available at www.goodjobsfirst.org/sites/default/files/docs/pdf/breaking_the_codes.pdf.
xxxiii Community Investment Corporation. The Rehab Checklist: An Apartment Building Owner’s Guide. Available at www.cicchicago.com/wp-content/uploads/2013/04/RehabChecklist.English.2013.pdf.
xxxiv For more information about estimates for lead paint removal, see HomeAdvisor: www.homeadvisor.com/cost/environmental-safety/remove-toxic-lead/.
xxxv An, B. et al. (2017). Understanding the Small and Medium Multifamily Housing Stock. Report prepared by Enterprise Community Partners, Inc. and USC Price School of Public Policy. Available at https://www.enterprisecommunity.org/resources/understanding-small-and-medium-multifamily-housing-stock-19423.
xxxvi Section 504 requirements apply to developers that receive federal financial assistance, such as Community Development Block Grant or HOME funds, for substantial rehabilitation (a project that has 15 or more units and the cost of the alterations is 75 percent or more of the replacement cost of the completed facility). Under these circumstances, a developer needs to make a minimum of 5 percent of units, or at least one unit, whichever is greater, accessible to persons with mobility disabilities and an additional 2 percent of units, or at least one unit, whichever is greater, accessible to persons with hearing or visual disabilities.
xxxvii ICAST. Multifamily Green Rehabilitation Resource Guide. Available at www.icastusa.org/wp-content/uploads/2017/01/ICAST-Multifamily-Green-Rehab-Resource-Guide-Old.pdf.
xxxviii Definition adapted from 100 Resilient Cities.
xxxix The United States is experiencing a significant trending increase in the number and severity of disaster events across the country as a result of increased exposure, vulnerability and extreme weather caused by a changing climate. In 2018 alone, the United States experienced 14 separate billion-dollar disaster events. The average number of billion-dollar disasters over the past three years was double that of the country’s long-term average. These risks include extreme flooding, wind, and heat, all of which can have significant impacts on housing structures and can lead to loss of units, increased expense, and loss of income. Knowing that these trends are projected to continue, it is imperative that we protect housing and communities through investments in disaster resilience and mitigation. Moreover, investing in resilience before disaster strikes is one of the most cost-effective ways to protect residents and property while strengthening their ability to weather the increasingly severe storms ahead.
xl A national study conducted by FEMA noted that each dollar invested in pre-disaster mitigation leads to an average of $4 in savings from avoided damages. These investments can also help lower energy use, reduce operational expenses, and lower insurance premiums.
xli This tool will be made available on Enterprise Community Partners, Inc.’s website in Spring 2020.
xlii Bay Area LISC and Build It Green. Green Rehabilitation of Multifamily Rental Properties: A Resource Guide. Available at www.novoco.com/sites/default/files/atoms/files/greenrehabmultifamilyrentals.pdf.
xliii For more information about South Florida’s High Velocity Hurricane Zone requirements, see Setting New Standards for Safety: The Florida Building Code: https://floridabuilding.org/FBC/publications/FBC.pdf.
xliv Jakabovics, A. et al. (2017). Small and Medium Multifamily Housing Units: Affordability, Distribution, and Trends. Report prepared by Enterprise Community Partners, Inc. and USC Price School of Public Policy. Available at www.enterprisecommunity.org/resources/small-and-medium-multifamily-housing-units-affordability-distribution-and-trends-19323.
xlv Diaz, M. (2004). Assessing Property Management for Affordable Housing. Paper prepared for the Joint Center for Housing Studies of Harvard University. Available at www.jchs.harvard.edu/sites/default/files/w04-9_diaz.pdf.
xlvi LISC. (2001). Managing Small and Scattered Site Portfolios Workbook. Available at www.lisc.org/our-resources/resource/asset-and-property-management-workbooks.
xlvii For more information about how to account for the full costs of maintaining a property over its lifecycle (i.e., a “lifecycle cost analysis” or “lifecycle underwriting”) see The Lifecycle Cost Adjustment Methodology: An Exploration of the Baseline and Alternative Assumptions by the National Housing Conference: www.nhc.org/publication/the-lifecycle-cost-adjustment-methodology-an-exploration-of-the-baseline-and-alternative-assumptions/
xlviii Diaz, M. (2004). Assessing Property Management for Affordable Housing. Paper prepared for the Joint Center for Housing Studies of Harvard University. Available at www.jchs.harvard.edu/sites/default/files/w04-9_diaz.pdf.