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
While battles are brewing in Congress over the future parameters of the EB-5 program, developers in dense urban areas, from New York to Los Angeles, are innovating in new ways to create affordable housing while providing profits to their investors.
New York City recently sponsored a citywide competition challenging developers to help solve the affordability problems in city housing. Due to skyrocketing land costs, without financial incentives, such as tax abatements or attractive financing rates, developers cannot justify building badly needed affordable multifamily projects. Programs such as 80 / 20 tax incentives and EB-5 have helped developers get back into the development of affordable housing projects.
In July 2012, Michael Bloomberg, then-mayor of New York, sponsored a competition and invited developers through a Request for Proposal( RFP) process to propose micro-unit apartment housing models. His idea was that in areas with high per square foot apartment costs, developers could create micro-unit apartments that allowed tenants to get access to less expensive, but not inferior, housing.
The adAPT NYC competition, as it was called, received 33 proposals from developers in the United States and internationally. In January 2013, the winners were announced. As a result, New York’ s first micro-unit apartment building constructed on a city-owned site in the Kip’ s Bay neighborhood of Manhattan started construction in early 2014.
In order to operate and outfit the Kip’ s Bay micro-unit apartments, Monadnock Development partnered with Ollie™, a specialist in micro-housing and co-living. The company was founded by brothers Chris and Andrew Bledsoe who left successful finance careers and spent several years designing and fine tuning the program.
The project opened in June 2016. The typical micro-studio ranges between 265 and 365 square feet, though variations exist from one property to another, as well as on a market-by-market basis. Every square inch of space has been designed and redesigned to ensure maximum efficiency. The micro units are fully functional with no wasted space.
The bathrooms are handicap accessible. The beds are multi-functional and durable. The bed retracts into the wall during the day and converts into a sofa. Each micro-unit has a full kitchen and plenty of storage space. When furnishing and designing the space, the focus was to maximize useable floor area and functionality. Most importantly, the units are aesthetically sharp and offer full amenities and a service package. The units are attractive to young professionals and other renters whose budgets may otherwise limit them to older units or to seeking roommates on Craigslist to share a room.
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EB5 INVESTORS MAGAZINE