Ithacating in Cornell Heights

For today, let’s take a look at the entrants competing for the city’s affordable housing funds.

The Ithaca Urban Renewal Agency will be holding public hearings on Thursday 3/22 and Thursday 3/29 s part of the process to determine who will receive money from the Housing and Urban Development (HUD) grants awarded to the city. The 28 applications, three more than last year, range from jobs training to community services to the development of affordable housing.

In aggregate, there is $2,042 million requested, and about $1.239 million available. For the sake of comparison, that’s a 60.6% funding vs. request ratio, slightly more than last year’s 58%, but less than the 83.2% ratio of 2016, and the 67% ratio in 2015. 2016’s ratio was high because of $273k in unspent money originally earmarked for the earlier INHS plan for 402 South Cayuga Street.

Roughly speaking:

Year    Request    Amount Available

2015 / $1.78m / $1.215m

2016 / $1.85m / $1.54m

2017 / $1.982m / $1.149m

2018 / $2.042m / $1.239m

Unfortunately, HUD funding is not going up – of that $1.239m, about $184k is carried over from 2017 – Finger Lakes ReUse decided to decline last year’s $50k award, as did 402 South Cayuga Street ($80k, Habitat for Humanity’s cancelled project) and Housing for School Success (~$34k). The other roughly $20k was unallocated funds. In truth, the award for 2018 is $1.055 million, while requested amounts continue to rise, and the head of HUD gets embroiled in scandal for, among several reasons, ethics issues involving HUD business dealings with his family, and trying to spend $31k on a dining set for his office.

Without discounting the value of the other applications, the focus here will be on the real estate development projects. A full rundown is provided by my Voice colleague Kelsey O’Connor here. For the record, writing about a project is neither an endorsement or opposition from this blog.

1. First, 402 South Cayuga Street. This site has had a rough history, unfortunately. It’s a small vacant lot just south of Downtown Ithaca that has had little good luck in the past several years. Five years ago, INHS originally attempted to build four units of for-sale housing on the property, but could not make it financially viable, as construction costs rose beyond what they could do within budget. Another developer proposed a market-rate plan, but the city, which owns the lot, has a strong preference for affordable for-sale housing. Habitat for Humanity also made an effort to build for-sale housing on the site, but it too saw construction costs rise beyond their capacity.

The grant application, $150,000 towards that $1.057 million project, would revive the INHS plan the planning board approved a few years ago. Two of the townhomes would sell to households making at or below 80% of Area Median Income (AMI, at or below $42,400/year for a single person), while the other two would sell to those making at or below 100% AMI (at or below $53,000/year), sometimes called “missing middle” housing. The funds would be used for construction and soft costs (legal paperwork, permit fees) on the two lower-priced units.

The reason why this is feasible now is that for one, the planning and design costs from 2013 have been paid off and the design is nearly the same, and two, the project will be modular instead of stick-built. INHS would partner with Cayuga Country Homes to build the four units. The units would be locked into the Community Housing Trust, and include features not in the previous plans, such as air-source heat pumps. However, the bay windows on the north and south walls have been removed from the new plans.

Breaking it down a little more, the construction cost would ring in at around $177/SF, about 10-15% less than stick-built. The three 2-bedroom units are 1190 SF and will cost about $210k to build, while the three-bedroom will be 1352 SF and cost about $239k to build (total about $870k, of which $830k is consumed by hard costs, materials and labor).

INHS will sell the 80% AMI two-bedroom at $121k, and the 80% AMI three-bedroom at $139k. The two 100% AMI units will sell at $159k. INHS will need to cover the remaining $291,000 with grants and subsidies just to break even. It is possible to build marginally cheaper, but insurers require INHS has to use contractors with at least $1 million in workplace liability coverage.

If funding were awarded later this spring, the units could be ready by April 2019. Although the construction method is different, the exterior changes are generally cosmetic – slightly different window arrangements, deleted bay windows, and porch details. It’s still at its essence four 2.5 story townhomes with ground-level rear garages and cantilevered rear decks. It is possible they could be signed off on at the staff level, but it’s more likely they would need to pay a quick visit to the planning board. The exterior changes could be reviewed and approved in one meeting.

2. The other INHS submission is titled “Scattered Site Phase 2: New Construction”. The request is for $100,000 to help cover soft costs (architectural and engineering fees) associated with the projects in the application. Calling them “scattered” is a little bit of a stretch – it’s two sites. One is 203-209 Elm Street on West Hill. That will have thirteen units, replacing twelve existing units, a count that includes 4-unit 203 Elm Street, currently vacant due to structural concerns. Six of the thirteen will be targeted to households at 50% AMI ($26,500/year for a single person), and the other seven at 60% AMI ($31,800/year). Ten of the units are one-bedrooms, and the remaining three are two-bedrooms.

The big question is the $16 million project planned for Downtown Ithaca. Although INHS cannot name the applicant, there were enough hints to figure it out with a fairly high degree of certainty. I can’t run conjecture on the Voice, but here, well, take the disclaimer that I could always be wrong. But consider the following:

From the notes in the application, we know it is:

• In census tract one – mostly Downtown and the State Street Corridor.
• The current site is a small commercial building.
• It is in the CBD – Central Business District.
• The site would host 20,000 square-feet of commercial space, and 40 housing units. The 30 one-bedroom and 10 two-bedroom units would be set aside for those making 30-60% AMI ($15,900-$31,800/year).
• An unknown number of units would be set aside for formerly homeless individuals or those in need of supportive housing. The current owner would provide supportive services in the first-floor of the commercial space.
• The partner in the project has provided services for over 150 years.
• INHS would buy the land for $750,000.

The only site that checks off all the boxes is the Salvation Army property at 150 North Albany Street. It is currently valued at $800,000, following a $100,000 bump upward last year. A back of the envelope suggests a gross square footage of 55,000 SF, plus or minus a few percent. That would put the new build at roughly the same size as Breckenridge Place (55,300 SF).

Zoning at the site is a little odd – it’s a split, CBD-60 on the southern two-thirds, and more restrictive B-2d on the northern third. CBD allows up to 60 feet in height, 100% lot coverage no parking requirement. B-2d allows four floors, 40 feet in height, and has no parking requirement if a building is more than 60% residential use – which there’s a fairly high chance this project would exceed. I’m picturing something five or more likely six stories on State, and stepping down to four on West Seneca Street. But, there’s still a chance I could be wrong, and this may isn’t the right site.

An approximate construction time frame for the mystery project appears to be October 2019 through January 2021. A sketch plan revealing the mystery partner and site is expected to be shown to the city planning board in June. SWBR Architects of Rochester is in charge of design.

3. The last one I’ll cover is the Finger Lakes ReUse expansion. Let’s preface this by saying they don’t own the site – the former grocery store turned BOCES turned eco-services non-profit entered into a purchase agreement with John Novarr in February 2014 to purchase the building for $1.25 million (below the assessment of $1.35 million), which they will do exactly five years after the agreement was signed, in February 2019. The $100,000 requested would be assistance towards the purchase of the property, freeing up their money to work on their upcoming construction projects.

As is, the site is a 17,000 SF retail building, and a 1,330 SF former garage/repair shop. Plans have been proposed for major additions – 6,500 SF of retail, 65,000 SF of office space, and 12,000 SF of supportive housing, which consists of 22 studios for low-income individuals, with emphasis on formerly homeless and/or incarcerated individuals. Welliver, INHS and TCAction have provided guidance and assistance; Welliver may be the general contractor as construction proceeds, and TCAction may manage the housing units. STREAM Collaborative is the architect.

Point of confusion – the approved plans call for a 26,100 SF, 4-story building with mixed-use retail, office and living space components, and an 8,100 SF open-air metal warehouse for reclaimed wood processing and storage. That all totals 34,200 SF, not 83,500 SF. There’s 49,300 SF that is not clearly spoken for.

The warehouse is phase one, will cost about $500,000, and be ready by Q3 2018. It will generate at least three living-wage jobs (an estimate Finger Lakes ReUse says is conservative). Phase two is funding dependent on the affordable housing component, and will provide at least six new living-wage jobs. Although NYS HCR affordable housing grants don’t typically cover commercial space, they can be applied to mixed-use structures.

The total project cost is $10.521 million. $1.89 million of the costs are covered with a NYSERDA grants, and Empire State Development has also offered a $500,000 economic development grant. Add in other grants and awards received or being pursued, and it appears that only about $3 million will be covered through loans. IURA funding an extra $100k makes the project more competitive for other grants, since FLR will have demonstrated they have more secured funds, and a higher chance of moving forward. The idealized time frame calls for a late summer 2019 construction on Phase II with completion a year later, but sit back and see what happens with applications and awards first.