Originally published on Forbes Business Councils by Seth Gellis, President of CPP.
It’s no secret that there is a nationwide housing crisis. According to the National Low Income Housing Council, "there is a shortage of more than 7 million affordable homes for our nation's 10.8 million plus extremely low-income families." And that’s just one of many sobering statistics. It’s clear that there is a need to develop affordable housing across the nation. While there isn’t a silver bullet to solve the crisis, I believe a solution that supports reducing per unit cost while also increasing generation of affordable units is a step in the right direction.
Affordable housing tax credits, issued through the Low-Income Housing Tax Credit (LIHTC) program, are instrumental for developers and partners looking to develop and preserve affordable housing nationwide. Qualified Action Plans (QAPs) outline housing priorities of the state and create the rules by which LIHTC applications are scored and credits are awarded. Examples of set-asides include geographic preferences, local housing market conditions, building characteristics (e.g., unit size) and type of project (e.g., new construction, rehabilitation), among others.
LITHC remains an essential part of the housing crisis solution in the U.S. Since 1987, it has helped to place 3.55 million affordable housing units in service. However, the guidelines and scoring mechanisms used to award tax credits for affordable housing projects have remained largely unchanged for decades—meaning that we are consistently evaluating (and funding) today’s affordable housing projects by 1986 standards.
At a high level, the goal of these guidelines is to promote the development of suitable, community-based affordable housing properties. But many of the guidelines are based on antiquated schemas and use cases that don’t factor in how people work, live, and interact with their community today. As a result, the scoring guidelines in the QAPs have the unfortunate and unintended consequence of discouraging affordable development—usually by increasing the cost of the development until it becomes unattainable, even with LITHC.
So, how do we increase affordable housing development while also maintaining a reasonable per unit cost? One key may be for affordable housing developers to take a critical and collaborative look at QAP scoring mechanisms to ensure that LITHC is operating effectively and efficiently. Based on my experience working in this sector, here are three scoring areas ripe for re-examination and collaboration among affordable housing stakeholders.
Many current state QAPs require affordable housing units to be a certain size, with California’s most recent QAP requiring one-bedroom LITHC units to be at least 450 square feet. At the same time, we’re seeing the emergence of market rate micro-units (apartments between 140 and 350 square feet) in urban cores as a solution to the need for more rental units in densely populated areas. Cities like Seattle have incorporated thousands of micro-units in their downtown core housing supply, resulting in high occupancy and more affordable rent.
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Downsizing the square footage requirement for affordable units to reflect trends in market rate units could enable developers to increase the density of affordable units within a property—making the property more affordable to develop and enabling the property to serve more people. In today’s world, where common property amenities and greenspaces may take precedence over primary living spaces, we must ask ourselves if unit square footage matters as much as it did previously.
Today’s tenants are looking for spaces that allow them to live, work, play and thrive in a seamless and convenient environment. Currently, many QAPs provide higher scores to affordable housing developments that are within certain distances of parks, libraries and other community cornerstones. However, many proposed affordable housing developments are looking to create those cornerstones within property lines—making the address’ location relative to existing cornerstones less important.
One example being explored involves including on-property parks, gathering spots, community rooms and social services. By providing your residents with free or subsidized high-speed internet access, they can access library materials online. There is also an opportunity for developers and property managers to subsidize subscription services (like Amazon Prime) for residents, which would allow for access to books and other entertainment media that would otherwise be accessible via library services. Through collaboration and implementation of creative on-site and technological solutions, you can create access to amenities and build community cornerstones within your own developments.
When LITHC scoring was first developed, there were no such things as Uber, Lyft, work-from-home or Amazon. Everyone was required to go to their place of work to get a paycheck—either via personal vehicle, public transportation or walking—and they’d have to visit a brick-and-mortar store to get their goods. Today’s mobile and gig economy enables residents to reap the benefits of a downtown core location while living further out from a city’s epicenter, where land costs for development are cheaper. For example, people can use rideshare services as transportation to work and can order groceries and medications to be delivered directly to their doorstep.
Looking forward, there is an opportunity to come up with flexible and innovative solutions that account for these types of amenities. One solution could be to work directly with cities to expand bus stops and routes further outside of the downtown core. However, there are other creative solutions to the issue to consider. If a property is not on a direct public transportation route, you may be able to work with rideshare companies to provide ride credits or reduced rates for their services to create affordable transportation options for your residents. Similarly, credits or partnerships with major retailers like Amazon, Target and Walmart could be explored for groceries and medications.
I believe looking at the affordable issue from a modernized lens will be an important first step in beginning to solve the nation’s affordable housing crisis, and that exploring creative options that allow developers to increase densification and unit creation will be foundational to the solution. Developers, businesses and public entities can (and should) work together to determine how QAPs can both better reflect the needs of modern-day residents and reduce per unit costs.
CPP, a mission-driven affordable housing preservation developer, has announced the acquisition and planned renovation of Ramona Park, an affordable housing complex in Baldwin Park, Calif. This is CPP’s fourth project in the Los Angeles area in the past year.
Ramona Park is located at 13870 Ramona Boulevard in Baldwin Park, approximately 15 miles east of Downtown Los Angeles. Designed with families in mind, the property is comprised of eight, two-story, garden-style buildings which house 49 one-, two-, and three-bedroom units. Community amenities include a community room, playground, and laundry room, as well as on-site management. CPP plans to invest $75,000 per unit in renovations.
"The renovations at Ramona Park reflect our ongoing commitment to preserving and enhancing affordable housing in Metro Los Angeles, where the need has never been greater. With more than 500,000 low-income households in the region struggling to find affordable rental options, it is critical that we invest in maintaining and modernizing these communities,” said Belinda Lee, Vice President of Development at CPP. “This acquisition, preservation and rehabilitation of the property will not only improve the quality of life for our residents but also ensure long-term sustainability, accessibility, and security for families who call Ramona Park home."
Ramona Park is set to undergo significant renovations to address long-overdue maintenance needs. The improvements will include both interior and exterior upgrades, such as new windows, flooring, cabinets, countertops, appliances, and lighting. Additionally, ADA-compliant units and pathways will be enhanced to meet local accessibility requirements. As part of the revitalization, new amenities will be introduced, including a picnic area, bike racks, a business center, social services, and surveillance cameras.
“Preserving and improving affordable housing is essential to supporting the well-being of our communities. The renovations at Ramona Park will provide residents with safer, more modern homes while also enhancing accessibility and adding valuable amenities,” said Philip Choi, Development Manager at CPP.
CPP is partnering with LifeSTEPS to provide on-site, instructor-led adult education, health and wellness, and skill-building classes and services to residents.
Renovations are expected to be complete by the end of 2025. The property’s affordability was set to expire in October 2025, but with CPP’s involvement, the Section-8 Housing Assistance Payment (HAP) contract will be renewed for 20 years. All units will be income restricted to family households earning 30%, 40%, 50% and 60% percent of the Area Median Income (AMI).
Additional partners on the project include the California Tax Credit Allocation Committee (CTCAC), who issued and allocated 9% LIHTC. WNC & Associates serves as the equity partner. US Bank is providing construction financing and Capital One serves as the permanent lender, using a Freddie Mac product.
CPP (Community Preservation Partners), a mission-driven affordable housing preservation developer, in partnership with Bettencourt Properties and The Beneficial Housing Foundation, has announced the acquisition and planned renovation of Sundance Apartments, an affordable housing complex in Bakersfield, Calif. This is the first community in Bakersfield for CPP.
Sundance Apartments is located at 6000 White Lane in the Spice Tract neighborhood of Bakersfield. The convenient location allows residents easy access to multiple bus stops, as well as a nearby grocery store, shopping center and restaurants. Originally built in 1981, the property has not received any substantial rehabilitations. The property is comprised of 10, two-story buildings and an additional single-story building which contains the community room, laundry room, and leasing office. Designed to accommodate families, Sundance Apartments offers 40 two-bedroom and 20 three-bedroom units. CPP’s total development investment is approximately $32.5M, which includes the purchase price of $20M and estimated renovation costs of approximately $80,000 per unit.
“Bakersfield, like many cities in California, is experiencing an affordable housing crisis. In fact, studies indicate that nearly one-third of Bakersfield residents are spending more than 30% of their income on housing,” said Belinda Lee, Director of Development at CPP. “The preservation of Sundance Apartments’ 60 affordable units will play a part in helping to ensure that the Bakersfield affordable housing supply is maintained for years to come.”
Sundance Apartments will receive significant renovations aimed at improving the property’s energy efficiency and modernization. Specific improvements include the replacement of solar and electrical panels, HVAC units, water heaters and appliances. Additional interior upgrades include the modernization of bath and kitchen surrounds and fixtures, and replacement of unit flooring. Exterior improvements include roofing replacement, repairs to the property’s asphalt, pavement and paths of travel, as well as upgraded landscaping. CPP also plans to upgrade the property’s community room.
“By preserving 60 affordable units and investing in significant upgrades, we aim to ensure that these homes remain safe, energy-efficient, and sustainable for years to come. Our partnership with Bettencourt Properties and The Beneficial Housing Foundation underscores our shared commitment to providing quality, affordable housing to the communities that need it most,” said Alexis Castillo, Assistant Development Manager at CPP.
CPP is partnering with LifeSTEPS to provide on-site adult education, health and wellness, and skill-building classes and services to residents.
Renovations are expected to be complete by the end of 2025. The property’s affordability was set to expire in 2027, but with CPP’s involvement, the Section-8 Housing Assistance Payment (HAP) contract will be renewed for 20 years. Additionally, the property will encumber a new Land Use Restrictive Agreement (LURA) to ensure affordability for 55 years. All units will be income restricted to family households at 60% or below Area Median Income (AMI).
Additional partners on the project include the California Tax Credit Allocation Committee (CTCAC), who issued and allocated 9% LIHTC. WNC & Associates serves as the equity partner. Banner Bank is providing construction financing, while Key Bank serves as the permanent lender, using a Freddie Mac product.
CPP (Community Preservation Partners), a mission-driven affordable housing preservation developer, has announced the acquisition and planned renovation of Normandie Villas, an affordable housing complex in Los Angeles. The property is situated in the highly desirable Adams Normandie neighborhood of Los Angeles. This is the sixth community in the greater Los Angeles region for CPP.
Normandie Villas is located approximately one mile from the campus of the University of Southern California and five miles from downtown Los Angeles. The transit-oriented location allows residents easy access to a bus stop, grocery store, public park and elementary school. Originally built in 1983, the property has not received any major renovations. The property is comprised of a single one-story garden style building and three, two-story townhome style buildings. Designed to accommodate families, Normandie Villas offers 15 two bedroom and 10 three-bedroom units, two of which will become fully handicap accessible as a result of the renovation. CPP’s total development investment is approximately $20.6M, which includes the purchase price of $11.5M and estimated renovation costs of $165,916 per unit.
“The south-central region of Los Angeles has a strong need for quality affordable housing and as evidenced by its long wait list, Normandie Villas reflects this need,” said Evan Cramer, Development Manager at CPP. “We are pleased that we are able to preserve 25 units of critical affordable housing for this community for years to come.”
Normandie Villas will receive significant renovations, including new shingle roofing, and energy-efficient HVAC systems and gas water heaters. Additionally, by implementing energy efficient improvements throughout the project, including upgraded roof insulation, installation of Energy Star windows and appliances, and use of high-efficiency LED lighting, CPP expects to double the property’s 10% energy efficiency improvement required by the California Tax Credit Allocation Committee (CTCAC).
“We are proud to be part of the solution to the affordable housing crisis in south-central Los Angeles and look forward to seeing the positive impact these improvements will have for years to come,” said John Fraser, Vice President at CPP.
Additional in-unit upgrades include new kitchen and bathroom cabinets, sinks, faucets and solid surface countertops, new entry and patio doors, new flooring, new toilets, shower surrounds and shower heads, and upgraded patio fencing. During the renovations, two of the property’s units will be made ADA compliant.
CPP will also make significant improvements to the property’s community spaces, including new site signage, landscaping improvements, new mailboxes, leasing office and laundry room upgrades, the installation of a new playground, ADA path of travel upgrades, new fencing at pedestrian gates, and exterior painting, among others.
CPP is partnering with LifeSTEPS to provide on-site adult education, health and wellness, and skill-building classes and services to residents.
Renovations are expected to be complete by June 2025. The property’s affordability was set to expire in 2027, but with CPP’s involvement, the Section-8 Housing Assistance Payment (HAP) contract will be renewed until 2044. Units will be set to 30%, 40%, 50%, or 60% of Area Median Income (AMI).
Additional partners on the project include the California Tax Credit Allocation Committee (CTCAC), who issued and allocated 9% LIHTC. WNC & Associates serves as the equity partner. Banc of California is providing construction financing, while Key Bank serves as the permanent lender, using a Freddie Mac product.
CPP, a mission-driven affordable housing preservation developer, has announced the acquisition and planned renovation of Ramona Park, an affordable housing complex in Baldwin Park, Calif. This is CPP’s fourth project in the Los Angeles area in the past year.
Ramona Park is located at 13870 Ramona Boulevard in Baldwin Park, approximately 15 miles east of Downtown Los Angeles. Designed with families in mind, the property is comprised of eight, two-story, garden-style buildings which house 49 one-, two-, and three-bedroom units. Community amenities include a community room, playground, and laundry room, as well as on-site management. CPP plans to invest $75,000 per unit in renovations.
"The renovations at Ramona Park reflect our ongoing commitment to preserving and enhancing affordable housing in Metro Los Angeles, where the need has never been greater. With more than 500,000 low-income households in the region struggling to find affordable rental options, it is critical that we invest in maintaining and modernizing these communities,” said Belinda Lee, Vice President of Development at CPP. “This acquisition, preservation and rehabilitation of the property will not only improve the quality of life for our residents but also ensure long-term sustainability, accessibility, and security for families who call Ramona Park home."
Ramona Park is set to undergo significant renovations to address long-overdue maintenance needs. The improvements will include both interior and exterior upgrades, such as new windows, flooring, cabinets, countertops, appliances, and lighting. Additionally, ADA-compliant units and pathways will be enhanced to meet local accessibility requirements. As part of the revitalization, new amenities will be introduced, including a picnic area, bike racks, a business center, social services, and surveillance cameras.
“Preserving and improving affordable housing is essential to supporting the well-being of our communities. The renovations at Ramona Park will provide residents with safer, more modern homes while also enhancing accessibility and adding valuable amenities,” said Philip Choi, Development Manager at CPP.
CPP is partnering with LifeSTEPS to provide on-site, instructor-led adult education, health and wellness, and skill-building classes and services to residents.
Renovations are expected to be complete by the end of 2025. The property’s affordability was set to expire in October 2025, but with CPP’s involvement, the Section-8 Housing Assistance Payment (HAP) contract will be renewed for 20 years. All units will be income restricted to family households earning 30%, 40%, 50% and 60% percent of the Area Median Income (AMI).
Additional partners on the project include the California Tax Credit Allocation Committee (CTCAC), who issued and allocated 9% LIHTC. WNC & Associates serves as the equity partner. US Bank is providing construction financing and Capital One serves as the permanent lender, using a Freddie Mac product.
CPP (Community Preservation Partners), a mission-driven affordable housing preservation developer, in partnership with Bettencourt Properties and The Beneficial Housing Foundation, has announced the acquisition and planned renovation of Sundance Apartments, an affordable housing complex in Bakersfield, Calif. This is the first community in Bakersfield for CPP.
Sundance Apartments is located at 6000 White Lane in the Spice Tract neighborhood of Bakersfield. The convenient location allows residents easy access to multiple bus stops, as well as a nearby grocery store, shopping center and restaurants. Originally built in 1981, the property has not received any substantial rehabilitations. The property is comprised of 10, two-story buildings and an additional single-story building which contains the community room, laundry room, and leasing office. Designed to accommodate families, Sundance Apartments offers 40 two-bedroom and 20 three-bedroom units. CPP’s total development investment is approximately $32.5M, which includes the purchase price of $20M and estimated renovation costs of approximately $80,000 per unit.
“Bakersfield, like many cities in California, is experiencing an affordable housing crisis. In fact, studies indicate that nearly one-third of Bakersfield residents are spending more than 30% of their income on housing,” said Belinda Lee, Director of Development at CPP. “The preservation of Sundance Apartments’ 60 affordable units will play a part in helping to ensure that the Bakersfield affordable housing supply is maintained for years to come.”
Sundance Apartments will receive significant renovations aimed at improving the property’s energy efficiency and modernization. Specific improvements include the replacement of solar and electrical panels, HVAC units, water heaters and appliances. Additional interior upgrades include the modernization of bath and kitchen surrounds and fixtures, and replacement of unit flooring. Exterior improvements include roofing replacement, repairs to the property’s asphalt, pavement and paths of travel, as well as upgraded landscaping. CPP also plans to upgrade the property’s community room.
“By preserving 60 affordable units and investing in significant upgrades, we aim to ensure that these homes remain safe, energy-efficient, and sustainable for years to come. Our partnership with Bettencourt Properties and The Beneficial Housing Foundation underscores our shared commitment to providing quality, affordable housing to the communities that need it most,” said Alexis Castillo, Assistant Development Manager at CPP.
CPP is partnering with LifeSTEPS to provide on-site adult education, health and wellness, and skill-building classes and services to residents.
Renovations are expected to be complete by the end of 2025. The property’s affordability was set to expire in 2027, but with CPP’s involvement, the Section-8 Housing Assistance Payment (HAP) contract will be renewed for 20 years. Additionally, the property will encumber a new Land Use Restrictive Agreement (LURA) to ensure affordability for 55 years. All units will be income restricted to family households at 60% or below Area Median Income (AMI).
Additional partners on the project include the California Tax Credit Allocation Committee (CTCAC), who issued and allocated 9% LIHTC. WNC & Associates serves as the equity partner. Banner Bank is providing construction financing, while Key Bank serves as the permanent lender, using a Freddie Mac product.