NEW TRENDS
IN AFFORDABLE
HOUSING
EB-5 FUNDED MICRO-UNIT APARTMENTS ARE
POPULAR IN MARKETS LIKE NEW YORK, LOS
ANGELES AND SAN FRANCISCO.
By Abteen Vaziri
These micro-units rent for approximately 10-15 percent
less than a conventionally sized unit in a comparable
full-service building nearby. The average studio apartment
in New York City starts at about $2,500 per month. HowWhile battles are brewing in
ever, tenants in conven tional New York apartments are on
Congress over the future parameters
the hook for hidden living expenses, like the cost to furnish
of the EB-5 program, developers
the unit, purchase internet service or join a gym.
in dense urban areas, from New
York to Los Angeles, are innovating
These micro-units save residents time too, and not merely
in new ways to create affordable
the time required to assemble furniture or set up cable
housing while providing profits to
and Wi-Fi, but also cleaning, chores and errands. For no
their investors.
additional fee, tenants have access to butler service Hello
Alfred! As a result, busy tenants can come home to their
beds made; their groceries bought, and even their laundry done. And, with hours of time salvaged in their weeks,
they have more time for fulfilling ways to spend it.
The demand for high quality, less expensive alternative
housing is very high in crowded cities such as New York
and Los Angeles. In the Kips Bay project, the 22 below-market-rent units had over 60,000 applications. Of the
22 units, eight were set aside for formerly homeless war
veterans through the Veterans Affairs Supportive Hous-
N
ew York City recently sponsored a citywide competi-
In order to operate and outfit the Kip’s Bay micro-unit apart-
ing (VASH) program and 14 were regular subsidized
tion challenging developers to help solve the afforda-
ments, Monadnock Development partnered with Ollie™, a
units for families with low income. The 33
bility problems in city housing. Due to skyrocketing land
specialist in micro-housing and co-living. The company was
units that were market rate received over
costs, without financial incentives, such as tax abatements
founded by brothers Chris and Andrew Bledsoe who left
500 online registrations.
or attractive financing rates, developers cannot justify
successful finance careers and spent several years designing
building badly needed affordable multifamily projects. Pro-
and fine tuning the program.
grams such as 80/20 tax incentives and EB-5 have helped
developers get back into the development of affordable
The project opened in June 2016. The typical micro-studio
housing projects.
ranges between 265 and 365 square feet, though variations
exist from one property to another, as well as on a mar-
In July 2012, Michael Bloomberg, then-mayor of New York,
ket-by-market basis. Every square inch of space has been
sponsored a competition and invited developers through
designed and redesigned to ensure maximum efficiency.
a Request for Proposal (RFP) process to propose micro-unit
The micro units are fully functional with no wasted space.
apartment housing models. His idea was that in areas with
high per square foot apartment costs, developers could
The bathrooms are handicap accessible. The beds are mul-
create micro-unit apartments that allowed tenants to get
ti-functional and durable. The bed retracts into the wall dur-
access to less expensive, but not inferior, housing.
ing the day and converts into a sofa. Each micro-unit has a
full kitchen and plenty of storage space. When furnishing and
The adAPT NYC competition, as it was called, received 33
designing the space, the focus was to maximize useable floor
proposals from developers in the United States and inter-
area and functionality. Most importantly, the units are aesthet-
nationally. In January 2013, the winners were announced.
ically sharp and offer full amenities and a service package.
As a result, New York’s first micro-unit apartment building
The units are attractive to young professionals and other rent-
constructed on a city-owned site in the Kip’s Bay neigh-
ers whose budgets may otherwise limit them to older units or
borhood of Manhattan started construction in early 2014.
to seeking roommates on Craigslist to share a room.
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