August 16th, 2011

Acton teardown (not my house)

I stumbled across this:

http://www.fizber.com/massachusetts/buy-acreage-land-home-1063924.html

Describing 80 Hammond as unsafe to live in, being sold as a tear down. The asking price proved to be optimistic at $325K; it ultimately sold in 2009 for $261K (to our builder), who built a house on it, and turned around and sold the house for $820K the following year.

http://www.zillow.com/homedetails/80-Hammond-St-Acton-MA-01720/57031602_zpid/

I haven't bothered to check Mass Land Records, so who knows if this is accurate or not. On the old house, the town was getting a little over $5K in property taxes a year. On the new house, they're getting a little over $15K. Thus, the 3X rule is satisfied not only for the purchase of the land and the sale of the resulting house, but even for the town's benefit through the increase in the tax rolls. It's a big lot -- over 2 acres -- and the house is about 3500 square feet (4/3.5), with a Wolf range.

People trying to understand why affordable housing in this town winds up being for-rent units in new, high-density developments rather than aging, deteriorating for-sale single family stock need look no further: aging housing stock (or, rather, the land it sits on) has a "higher better use" in this town (you don't even need to produce a McMansion to make the numbers work, either; 50% bigger than an average new house gets it done), and there are enterprising developers making steady work out of converting the aging single family stock into that "higher better use". (<-- That's a term of art; that's why it is in quotes, so as to disambiguate where the value judgment is coming from.)

The one route to stopping this process -- legally allowable -- has been constrained by 40B for a long time, and the most recent effort to overcome that was a rousing failure.

http://ballotpedia.org/wiki/index.php/Massachusetts_Comprehensive_Permits_and_Regional_Planning_Initiative,_Question_2_%282010%29

I'm still trying to come up with an illustrative case for the but-you're-exploiting-40B-to-get-density-for-luxury-units complaint. Maybe tomorrow.

Things I Cannot Make Any Sense Out Of

If you were to google things like Chelmsford, Richard McClure, recall, 9 North Rd, etc., you would stumble across a really huge local news story that completely failed to cross my vision (the word "local" is important, as it turns out). It is complex, involves development of a property, decisions made by town officials, (a) lawsuit(s), a judicial decision and a recall election. I'm sure there's a lot to learn from it, altho I'm not entirely certain what that would be.

Westford 40B development, Princeton Properties, Abbot Mills, etc.

http://www.wickedlocal.com/westford/news/x157800964/Affordable-housing-development-could-be-coming-to-Westford

I haven't dug back to get the details on the previous 40B application for this location; I'm betting it was one of the big nationals possibly partnered with a local developer. The current developer is Princeton Properties, interview with CEO Chaban here:

http://www.multihousingnews.com/features/propertymanagement/qa-with-princeton-properties-managements-andrew-chaban/

Solar power for the common areas. Automating the leasing process on iPads. Someone is On Message.

While bigger builders are often going taller to deal with the small lots available in Eastern Massachusetts, not Princeton. Most of their portfolio is "three-story garden-style apartment communities" and most of those rent for "$1,000-$1,700 per month". They are eying student housing but have not done any yet.

Chaban mentions a "tax exempt low floater" deal: I had no idea what that meant.

http://www.icemiller.com/publications/21/1004208.htm

There's no reason to believe that deal has anything to do with Westford.

Here is Princeton's homepage:

http://www.princetonproperties.com/

Like some large apartment REITs, many of their properties have the corporate name as part of the property name.

ETA: Abbot Mills, on the National Register of Historic Places, is a residential renovation project in Westford that will be 129 units of which 19 will be affordable.

http://westford.patch.com/articles/the-spin-on-abbot-mills-renovations

This is another project which started grinding through the process during the boom and stopped during the bust, has since secured financing and started construction earlier this year. Yule Development Company is a local end-to-end for-rent residential and commercial greyfield developer.

I cannot believe I just wrote that. I didn't even quote it. Here's how they self-describe:

http://yuledevelopment.com/home/

"Yule Development Company is engaged in residential and commercial real estate development in the Greater Boston area. Our expertise is in identifying distressed real estate, designing creative solutions, implementing the resultant development plans, and managing the completed projects."

It's a company named after the main person, if you were wondering how the Christmas theme crept into a developer name.

Digging around in their development portfolio .pdfs is enlightening: they don't just take snazzy things like mill buildings and trick them out as expensive housing. They take apartment complexes which have been returned to the lender because of failed septic systems and upgrade them massively: wastewater treatment, new clubhouse and pool, energy savings, "repositioning" in the market, etc. Truly, development that even an anti-development person could love. I think.

Lexington, affordable housing, Avalon, kids

There's a lot that can be said about Lexington: the fact that they have multiple nursing homes (Brookhaven lifecare, Golden Livingcenter), multiple big Avalon apartment complexes, a Princeton Properties complex, new urbanist development in the town center (I'm not touching that one, because I read the condo limitations on the commercial/retail space in that development and I'm completely speechless), _actually exceeding_ their state 40b requirements, having article 4 on the 2007 town meeting ballot be about possibly _requiring_ affordable housing on developments with more than five houses.

I'll start here:

http://www.wickedlocal.com/lexington/features/x698070514/Projections-dont-match-reality-for-Avalon-at-Lexington-Hills

Avalon at Lexington Hills was going to be 430 units, but was reduced (presumably at the town's behest) to 390, 25% affordable. The assessed value in 2011 is less than was projected when it was proposed in 2004 (little thing happened in between then and now, perhaps you recall it), thus reducing the expected property tax collected from the complex. And they got more schoolkids than they were anticipating. They projected "between 67 and 125 new students to Lexington’s public schools"; they got 166.

What would I have predicted? Nationally, as of 2010, multifamily runs 2.4 people per unit vs. 2.5 in single family. I would have assumed that while some households would have had 2.4 adults and some households would have had a lone adult with 1.4 kids, I couldn't guess which way the fraction would lean. I know metrowest runs heavy to two adult families, and assumed the .4 was all kids. Thus:

390 * .4 = 156.

Unreasonably assuming 100% occupancy -- but I also know that there's a lot of 3 bedrooms in these developments and the Lexington school district is awe-inspiringly good, if your family doesn't suffer from debilitating anxiety in the face of how competitive it is. I would sort of assume that 3 bedrooms in Lexington would attract a disproportionate number of 2 kid families.

I would have come in low, altho not particularly low.

"There was also a failsafe built into the deal brokered between the town and the developer. For every public school student over 111 coming from Avalon, the developer would provide roughly $7,100, the incremental cost of educating that student. Per the agreement, total compensation to the town is limited to $750,000 within 10 years. That cap was reached in the current fiscal year, with the town only able to collect about $331,000 of the $390,500 associated with the 55 additional students coming from Avalon."

That $7100 incremental cost caught my eye -- that sounds low to me based on some research I've done in the past, but never mind that now. That's an amazing deal the town cut with Avalon.

I liked this remark. A lot.

""Something in the intervening seven years changed the normal Lexington response to multi-family housing,” said Connery. “You may be seeing the beginnings of a shift to rental housing in a place like Lexington that has a high-quality school system.”"

Yup. Consistently high gas prices and a massive housing crash. Unemployment around here isn't too bad, especially compared to a lot of the country and, as mentioned above, Lexington school district is excellent.

R. says that when you look at Waltham via satellite view on google, it's densely multifamily, colonizing Lexington. That suggests that the wave outward from the center is currently cresting in Lexington, which goes a long way to explaining Concord being weird on the subject: they know they're next.

ETA: I'm inclined to think that Mehr is full of it, however, I also think that the expected number of kids was ridiculously low. Whether I would have thought that in 2004 is an entirely other question, however, which should make my opinion on this subject very uninteresting.

Maynard

Obviously, Maynard has affordable housing. Also, Maynard has a McDonald's with a drive through, that has recently been razed and redeveloped.

Maynard has another MacDonald, too: James G. MacDonald of MacDonald Development Corporation. We've found three projects: Maynard Place and Maynard Commons (I think both completed, apartment complexes) and a third one that hasn't started yet. His buildings are low-key and fit in well with the town while still being very attractive (this is a bit of a trick in Maynard: the brick and the mill stuff is super cool, but everything is old and aging). Even more stunning, MacDonald has assembled multiple lots for these projects -- something that I _thought_ should be happening, but could find no evidence of.

http://www.wickedlocal.com/maynard/news/x902724217
http://www.wickedlocal.com/maynard/news/x828497174

That latter one also includes discussion of the new Walgreens building.

Here's a summary of Maynard Mixed Use development goals and how MacDonald is contributing to them:

http://www.metrofuture.org/files_metrofuture/userfiles/file/Campaigns/Local%2520Smart%2520Growth/Maynard%2520Downtown%2520Redevelopment.pdf

I have not been able to figure out what fraction of housing in Maynard qualifies as affordable, however, I cannot imagine they are not above 10%. MacDonald is contributing towards "land protection" rather than including affordable housing units in his developments.

I like Maynard. They incubate excellent restaurants.

I will further note that if I were a developer in metrowest, I'd always show up asking for 15-30% more units than I actually intended to build. It's as if multifamily has a knockdown process.