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Affordable housing strategy gets buy-in from developers

Posted at 4:26 PM, Apr 27, 2022

SAN DIEGO, Calif. — Few zip codes are immune to America's affordable housing crisis. Impossible for city and state leaders to ignore, they're rolling out new strategies to try and solve a disaster decades in the making.

“We just made a lot of rules of what’s allowed to be built and where," said Colin Parent, executive director and general counsel at Circulate San Diego. "You're seeing policymakers around the country recognizing they really do have a problem. They've been making it too hard to build homes."

The debate centers around how and where to build more affordable homes.

"Even if you own your own home and are not worried about the price of housing for yourself, you're worried about your kids being able to have a place to live, you're worried about your parents being able to retire and live in dignity," said Parent.

Once an attorney at a corporate law firm, Parent now spends his days tackling the issue in his hometown of San Diego — home to some of the most unaffordable living in the country.

Circulate San Diego partners with local governments, school districts, and private planning firms to advocate for better transportation and more sustainable land use choices in the region.

In 2016, the organization backed a program enacted by the city to address the region's housing crisis.

The Affordable Homes Bonus Program (AHBP) builds upon California Density Bonus Law, allowing developers to build more homes if they agree to dedicate a portion of a new multi-family project as affordable.

Analyzing it in a new report, Parent says the program is boosting the production of both market-rate and deed-restricted affordable homes.

“If you create some powerful incentives that make sense for developers to use, they’ll use it. And build some affordable homes along the way," he said.

AHBP allows up to a 50% bonus if a developer agreed to dedicate up to 15% of the base zoning as affordable to very low-income households.

Affordable housing developer Jimmy Silverwood is among developers embracing the new incentives.

"We're able to spread the construction costs across more units," said Silverwood, executive vice president of Affirmed Housing. “Developments like this, they allow for people who work in the community to walk to work. There’s a lot of different transit options."

According to the report, 44% of homes entitled in 2020 were in developments that used the AHBP.

Parent says similar programs offering lower bonuses have failed to generate a significant boost in housing.

"Now you're seeing broad acceptance in the market of doing projects like this, incorporating affordable units into new developments," said Parent. "Not just because it's the right thing to do but because it's good for the bottom line too."

It could serve as a model for cities statewide and across the nation.

"You definitely have to get creative," said Silverwood. “Such a wide range of residents that we serve in California — over 10,000 veterans, formerly unhoused Californians, seniors, families. To hear all their stories, it really makes the work worthwhile.”