Work on Dick Gregory Place Apartments well underway
The other day I was driving in and around the Ville neighborhood and I spotted work on the Dick Gregory Place Apartments:
This project was one of a handful of projects that got the go ahead with help from federal stimulus funds used by Missouri to provide gap funding:
“$7,875,000 for the Dick Gregory Place Apartments, located in the 1500 to 1900 blocks of Dick Gregory Place, the 4600 block of Aldine, and the 4600 block of Martin Luther King Drive in St. Louis. The project is being developed by two community organizations – Northside Community Housing Inc. and the Greater Ville Neighborhood Preservation Commission. The development will have a mix of 40 newly constructed and renovated units.” (Source: Stimulus boosts eight projects for $18 million – St. Louis Business Journal)
The project includes both new construction and renovations of existing structures. I’m thrilled to see two buildings included:
The above building on the NE corner of Dr. Martin Luther King Dr and Marcus Ave. is among my favorites in the city. The buff brick, overall massing, the arched openings onto Marcus & MLK and the 2nd floor bay window are features that make it a winner. I’ve been following it for a while.
In the far right of the above picture you can see the other building I’m fond of.
Both of these structures have come very close to being razed, especially in the last few years. The impact of this project will be outstanding for the area — both in utilizing vacant structures and filling in holes where other structures had been razed.
– Steve Patterson
Are they going to take out the brick infill and glass block of the buff colored building? It looks like at one time it was a glass store front. Neither seems fitting on a historic building like this.
I'm conflicted. While saving these structures seems to be a good thing, I'm not so sure about spending the $7,875,000 (!) in “gap funding”. That seems to be a whole lot of money, especially for just 40 units (that's $196,875 per unit). And with the current 11.3% vacancy rate* in north city, is there really that much need for any more units?! I know, I know, I sound like a broken record on this, but why is the government spending our money on projects that the private sector doesn't see as viable (otherwise they WOULD be doing them and making money at it)?
I understand (and support) spending money to attract new businesses, support existing ones and to assist local start-ups – they all should generate more and better-paying jobs, which, in turn, will increase demand for better housing of all types. But just building new housing, and renovating existing structures, without a parallel growth in jobs, is no different than using TIF's to build new shopping centers. Sure, residents will move into these new units, but from where? Are we just reinforcing the cycle of accelerated decline of the other, unsubsidized, existing units? By “stealing” from a finite supply of tenants?
*http://www.special-assets.com/?p=311
Ditto JZ71. Conflicted, but for me, the magnitude of this project wins out for me.
Steve, can you explain the gap funding? Is it a loan or a grant? How much are the community groups investing? Is it $20K/unit or $300K? ($200K per unit sounds like the majority is coming from the government.)
The only other option is demolition. That's what already is happening with lots of the historic structures in and near The Ville. And these were just listed on the National Register of Historic Places.
It's not an exaggeration to think that if not for the community groups behind this project, most of these buildings would have been headed for the landfill, within a year or so of being listed on the National Register.
I agree, without some support, the future was probably grim for these structures. My concern is the magnitude needed/granted. The article identified several other projects with apparently much better returns on investment – $750K for 31 units, $800K for 50 units, $1M for 117 units, $2.3M for 77 units, even $2.2M for 34 units. The $7.9M here for just 40 units seems to be extremely generous.
Not probably grim. Fatal. All neighborhoods are not equal. More disinvested areas require deeper levels of assistance. The list of gap projects is not an apples to apples comparison.
Most of those projects are built on green fields with new construction. Since it costs more to do rehab in low income (often black) neighborhoods, maybe we should focus all of our public investments in places like St. Charles and Jefferson Counties? It would certainly be cheaper and you'd get a higher “return on investment”! Like this approach? Rand Paul does. The rest of us call it institutional racism.
Nice. Play the racism card. “All neighborhoods are not equal.” Agree. “More disinvested areas require deeper levels of assistance.” Agree. “The list of gap projects is not an apples to apples comparison.” Agree. “Most of those projects are built on green fields with new construction.” That's not what I'm reading:
“$2,295,000 for North Tower Group’s Water Tower Village at 4518 Blair Ave., St. Louis [near Grand & I-70]. The development will have 77 units in rehabs of existing buildings.”
“$750,000 for North Newstead Association’s development of the North Newstead V project located in the 4100 block of Newstead and the 4400 block of Lee in St. Louis, which will have 31 rehabbed units” northwest of Fairgrounds Park.
“Since it costs more to do rehab in low income (often black) neighborhoods, maybe we should focus all of our public investments in places like St. Charles and Jefferson Counties?” I did not say anything like that. You may want to stoop to calling it “institutional racism”, but I see nothing wrong expecting fiscal prudence from our government.
Yes, we have an incredible stock of old, many times historic, structures in the city that are worthy of saving. We also have finite resources to accomplish that laudable goal. My question is simply whether we'd be better off spending $7.9M here for just 40 units, or potentially replicating THREE PLUS of Tower Group's model and producing some 250 units (!) for the same investment in a similarily-disadvantaged neighborhood?!
The article you are reading is a partial list (St, Louis only). Many (if not most of the projects listed are new construction (apples and oranges to gut rehab of historic building).
The gap funds mentioned in the article are a variation of tax credits. Because of the downturn in tax credit pricing duye to economic conditions, the federal government offered tax credit replacement funds as part of the ARRA to states having difficulty attracting investors for tax credits.
Regardless, whether in the form of tax credits or tax credit replacement funds, the federal government is subsidizing the development of affordable housing. To see the sort of across the board investing in affordable housing supported by the federal low income housing tax credit program, you should read from the Missouri Housing Development Commission's website. They have the total list.
You will see many large, new construction developments completed across the state at a much lower cost per unit than Dick Gregory Place. To get Dick Gregory done, the city, the state, and the federal government cooperated on a project of local and national cultural and historic significance. There is much more to be considered than simply cost per unit.
Every project is unique. Gut/rehab ones even more so (apples and oranges). I do not expect identical or lowest cost per unit (a valid and accepted metric), but when one project has significantly higher costs (as in 3 to 10 times higher per unit), one has to ask why? Are there other components included, like commercial spaces, that the other projects don't have? Are we replicating plaster crown moldings or terra cotta cornices? Are we (the taxpayers) simply paying a much higher percentage of the total cost, with the development group adding a relatively insignificant amount?
I'll repeat. We have finite resources. We need to balance our desire for historic preservation with economic justice with simply housing as many people as possible. Yes, this article focused only on the city. You may want to question statewide funding choices, but I don't want to go down that road, except for questioning perceived extravagance, which could be used against us.
I'll admit that I don't know any of the details on any of these projects. I'm just here in south city (where no ARRA funds are apparently being spent) asking honest questions about how the funds are being spent. You keep repeating that “Many (if not most of the projects listed are new construction”, yet the article states that three are rehabs, three are new builds and the last, for the Eliot School, sounds like another rehab. The article also states that this project is a mix of both new and rehab, so, by your logic, it should fall in the middle of the pack, pricewise.
If the only reason costs are significantly higher here is the need to replicate historic details, I have a real fear that it'll be used to justify future spending in non-historic areas. Paying a 20% or 30% premium can be justified to the luddites. Paying a 300% premium “just to save an old building” is the type of thing that makes the news, especicially if the goal is getting more people into acceptable housing. But if there are other issues (which there likely are), focus on explaining why, because cost per unit will continue to be an easy issue to question.
JZ, where in your area of Southwest City would your Southside Neighbors support a low income housing tax credit rental housing development? Where in your area of Southwest City is reinvestment needed at the rate of North St. Louis and the Ville? To your question re. historic rehabilitation details, yes, Dick Gregory is historic rehab. It qualifies for federal and state historic tax credits. The project is close to 90% historic rehab.
Here in the northeast we suffer from a similar problem. We have many truly historic, even beautiful, buildings that are regrettably functionally obsolete but there is no viable business or rehab plan the numbers won't work. If the math doesn't work the work shouldn't be done. IMHO
I disagree. Without this project a larger area would remain marginal. The value of each dollar will go way beyond each of the complete units.
“If the math doesn't work the work shouldn't be done. IMHO” Hmm, I'd like to see how the math comes out on suburban and exurban development if the contractors and developers had to pay for all of the roads, sewers, water treatment, electrical distribution lines, etc. if the federal gubmint wasn't paying for most of it. The City of St. Louis had enough of it's own wealth to build its own roads, sewers, water system, and much more, in the zenith of its history. Did St. Chuck pay for its roads, epecially the Interstates and state roads? No. Did O'Fallon, MO, pay for its sewers without federal help? Not bloody likely. Certainly not modern upgrades. Do automobile and truck owners pay for the full cost of their share of roadway construction and maintenance? No. Don't throw that “numbers don't work” crap at me. That's one of the really infuriating aspects of suburban/exurban residents. They seem to think everything they see–and don't see–around them felleth from the sky, as if made up from whole cloth. Or created in a vacuum. Rampant suburban development after WWII happened for numerous reasons, not least of which was the federal subsidies for it all. And, conversely, the federal gov't essentially paid Cities to destroy themselves, because they wouldn't finance improvements, beyond plowing Interstates through intact neighborhoods. So, urban areas are already at a disadvantage, and you all want to throw the viability card at us? Let's see how the development in suburban/exurban areas would go if we took away ALL of the monies the feds allocate to them. Grab the popcorn, this could get fun. Oh, right, never gonna happen. So, throw us a bone here in the urban areas, will ya'? Thanks.
Amen, the hypocrisy of many suburban residents in their calls for fiscal responsibility amazes me
The article lists 8 projects. It provides some details for 7 of them. Obviously, some of the projects are paying for their construction with something other than ARRA funds/gap funding. Still, no one has really answered why this project requires a subsidy of nearly $200,000 per unit, when the next-most-expensive one is being done with a subsidy of $65,000 per unit. Are the units extra large? With granite countertops, Viking ranges and Sub-Zero refrigerators? Whirlpool tubs and gold-plated fixtures?
Primarily Rehab (building condition undefined):
$2,295,000 for 77 units, northside – $29,805 per unit
$2,200,000 for 34 units downtown – $64,705 per unit
$750,000 for 31 units on northside – $24,194 per unit
$7,875,000 for 40 units, northside – $196,875 per unit
New construction (assumed to be pretty basic):
$800,000 for 50 units on northside – $16,000 per unit
$750,000 for 18 units on northside – $41,667 per unit
$1,000,000 for 117 units downtown – $8,547 per unit
And in response to NN: “where in your area of Southwest City would your Southside Neighbors support a low income housing tax credit rental housing development?” We have a range of apartments, privately owned but at multiple proice points, including Section 8, along both Jamieson and Chippewa, and on both sides of Kingshighway. We don't have a lot of vacant lots, so there's not a lot of development activity.
“Where in your area of Southwest City is reinvestment needed at the rate of North St. Louis and the Ville?” Not much, which is why we're not seeing any ARRA funds. My concerns aren't that ARRA funds aren't being spent here, or that they're only being spent north of Highway 40, it's HOW they're apparently being spent. Just one example of what “nice” apartments are selling for in Chesterfield is Schoettler Village, with 300 units, that sold for $26,000,000 in 2005 ($86,667 per unit). The units there rent for $855 to $1405. Is anyone expecting to see $2000 or $3000 rents at the the Dick Gregory Place Apartments (based on the $196,875 investment)?
I agree with Steve's first statement, that “Without this project a larger area would remain marginal.” We'll just have to wait and see how true “The value of each dollar will go way beyond each of the complete units.” They better damn well be, otherwise we're spending a lot of money for not much return, intrinsic, emotional or real . . .
I thought the Page extension was a lot of money for not much intrinsic, emotional or real return–but I, as a taxpayer, had to pay for it anyway.
JZ, there's a big disconnect in your analysis. You're only looking at the amount of ARRA gap funding per unit, but not adding the amount of low income housing tax credits awarded to each project. If you look at the total picture – ARRA gap funds and LIHTCs, the numbers start to even out.
Like I said, I don't have complete information. Is there someplace where all the numbers are available? But whether it's ARRA or LIHTC, the bottom line is the bottom line – most curent rental-apartment projects, especially those aimed at the “affordable” market, are being constructed for less than $150,000 per unit. 7 out of 8 projects in the article fit that model nicely, while this one doesn't. There may be, and likely are, reasons why, I just haven't seen them articulated, with specifics.
JZ, if you haven't seen the arguments, then you're not reading very closely. Samizdat and Steve Patterson have articulated the case for community reinvestment. What part of that is giving you trouble?
The part where this one project is requiring 3 to 12 times as much “reinvestment” support, per unit, as every other project listed in the same general area.
Jz, your reasoning is flawed because you are not including the value of tax credits on the other projects.