In recent months, the need for workforce housing has been highlighted on the Vanguard and elsewhere. Coming before the council on Tuesday is the proposed 3820 Chiles Road Project which “would redesignate and rezone the existing commercial property to a high-density residential use and demolish the existing building (an eligible historical resource) to redevelop the site with a 225-unit apartment project.”
The result is unlike previous apartment projects, as this project does not target student population but instead “focuses on meeting the demand for workforce, professional, and family rental units.”
In addition, unlike other recent projects which focus heavily on three to five room apartments, the proposed three and four-story buildings consist of more traditional one, two, and three-bedroom units – rented by the unit.
A big matter of concern, tracked in the Vanguard and elsewhere, has been the efforts at addressing affordability-related concerns. Staff notes that “a recent economic analysis of multi-family residential housing prototypes, prepared for the City by A. Plescia & Co. and Gruen Gruen + Associates, identified economic challenges for this type of development.”
Staff writes: “For the Large Traditional prototype, which is similar to the proposed project, the analysis determined that the project is marginally feasible without affordable housing requirements and would be infeasible with affordable housing requirements under the scenarios reviewed.”
Thus, as covered previously, “The project’s Affordable Housing Plan takes an alternative approach and proposes to create an ongoing contribution to the City’s Housing Trust Fund to help fund the City’s affordable housing programs.”
Overall, “Staff believes that the proposed project would be compatible with the surrounding mix of commercial and residential uses and would enhance the neighborhood. It meets a housing need and provides a housing type, which has not been constructed in the City in recent years, with a new approach to the affordable housing issue.”
The applicant is requesting to redevelop the current 7.4 acre office property located at 3820 Chiles Road. It proposes a new multi-family residential project which would demolish the existing office building, remove 92 trees, and construct three residential buildings with 225 apartment units and other amenities.
The project will also provide a maximum of 319 vehicle parking spaces and 361 bicycle parking spaces.
Staff notes, “The primary benefit would be the development of a housing type for groups that have been recently underserved.”
Of paramount importance, staff notes: “Although a number of single-family residential subdivisions, student-oriented apartment developments, and affordable housing projects have been approved or built in recent years, no sizeable market-rate apartment project catering to the local workforce, working professionals, mature singles, or small families has been constructed in the City for some time.”
The need for workforce housing was seen as a critical driver of this proposal. Staff notes that the applicant met with various stakeholders and dialogued with neighbors, community leaders, employers and employees, and ordinary citizens.
“Particularly vocal were owners of businesses ranging from fledgling enterprises to established firms in industries ranging from retail to tech. According to the applicant, these employers see the limited and expensive housing stock in Davis as impediments to attracting and retaining qualified staff,” staff writes.
Companies they talked to noted that “more than one-half of the employee workforce travels daily from Woodland, Sacramento, Dixon, and beyond.”
Staff adds: “Employers and employees alike cite the existence of a ‘Missing Middle,’ a cohort of middle income residents who earn too much to qualify for below market rate housing, but too little to be able to afford suitable rental housing in Davis. This project begins to fill the demand.”
Affordable Housing Plan
The current plan calls for the project to “make an on-going annual payment to the City’s Housing Trust Fund of 1.65 percent of the total gross rental income in perpetuity, with a minimum annual payment of $100,000.”
Staff estimates that approximately $125,000 would be generated in the first year of implementation and it “would be expected to increase over time commensurate with rents.”
Both staff and the developer believe that the structure and amount of this payment is feasible for the developer who would not have been able to pencil out a more traditional arrangement.
Importantly, “it provides a dedicated revenue stream to implement the City’s affordable housing goals and programs. The proposal would be allowed under the Alternative Affordable Rental Housing Requirements of the Affordable Housing Ordinance with approval of the amendment mentioned.”
Staff notes – and this will be discussed separately – that council will be asked “to consider an amendment to the City’s Affordable Housing Ordinance. It is necessary for consistency with the project’s Affordable Housing Plan.”
The amendment would add ongoing funding for the city’s affordable housing program. The Social Services Commission reviewed this proposal two weeks ago, saying, “While the Commission expressed general support or interest in the concept, there were also comments requesting more analysis and research on the possible alternative, as well as concerns about setting a precedent and a comment wanting to prioritize on-site affordable units.”
—David M. Greenwald reporting