The Ann Arbor housing commission board was updated recently about efforts to renovate and redevelop the city’s public housing properties, a massive undertaking that’s been in the works for more than a year.
Norstar Development president Rick Higgins and Lori Harris, the firm’s senior project manager, briefed commissioners at the board’s June 19, 2013 meeting. The board had selected Norstar as a co-developer for this overhaul in January.
Norstar’s presentation included a review of the two low-income housing tax credit applications that the AAHC plans to make in August to the state of Michigan. The applications will cover a total of five public housing properties: Miller Manor, South Maple, Baker Commons, Hikone and Green/Baxter complexes. These properties make up the bulk of public housing units in the AAHC portfolio – 248 out of a total 326 units.
If approved, the tax credits would provide a large funding source for renovating those properties. It’s part of Norstar’s effort to help AAHC convert Ann Arbor’s public housing units into public/private partnerships through a new rental assistance demonstration program, known as RAD, offered by the U.S. Dept. of Housing and Urban Development (HUD). AAHC was accepted into the program late last year. The goal is to allow AAHC to use private financing for capital improvements in its existing housing stock, which is decades-old and in need of major upgrades.
The Ann Arbor city council signed off on this process by unanimously passing a slate of resolutions at its June 3, 2013 meeting. One of the most crucial actions was approval of an ownership transfer for public housing properties – from the city of Ann Arbor to the housing commission. AAHC has managed, but does not own the properties.
As part of the tax credit application review process, Norstar representatives described the financing and legal structure to be used in renovating these first five properties. Among the challenges is the potential need for significant asbestos abatement at most of the locations, as well as major HVAC infrastructure upgrades at Miller Manor. Higgins indicated that he’s somewhat worried about the budget for these renovations, and thought it might be necessary to seek additional funding from the city and other sources.
In addition to the five initial properties that will be renovated, Norstar also is developing site plans – working with AAHC and the city’s planning staff – for four AAHC complexes that will likely be demolished and, with some exceptions, rebuilt: North Maple Estates, Platt Road, White/State/Henry, and Broadway Terrace. Redevelopment of these sites, particularly at North Maple Estates and on Platt Road, is expected to add 26 new units to the city’s low-income housing stock.
Related to this conversion process, no action was taken by the AAHC board on June 19 . Jennifer Hall, AAHC executive director, told commissioners that she plans to bring forward a voting item for them at their July 17 meeting – related to amending the city’s RAD application. The original application covered only about 80% of AAHC properties, but now the goal is to include all properties in the RAD conversion. Hall noted that because Norstar representatives were in town on the date of the June 19 board meeting, she’d asked them to brief commissioners on the redevelopment efforts so far.