Rafael Cosio, Director of Development
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Hollywood, CA 90028
T. (323) 957-7200
Housing Projects for LGBT Elders Stalled Due to Economy
New America Media, News feature, Inga Buchbinder
Wednesday, December 09, 2009
SAN FRANCISCO -- The economic crisis has stalled the construction of many housing projects run by the public and private sector, and top among them is affordable housing for lesbian, gay, bisexual and transgender (LGBT) seniors.
A case in point is Openhouse, an organization dedicated to providing social, health and community services for LGBT elders. After 10 years of working to gain entitlement from the City and County of San Francisco, in April 2008, Openhouse was finally granted permission to build an affordable housing facility in the heart of San Francisco for low-income LGBT seniors.
The organization struggled to clear many hurdles, even gaining a positive vote on the project from the SF Board of Supervisors and support of neighborhood groups. Unfortunately, the economic crisis stalled the building project.
“Right now things are a little bit slowed down on that project, but we are still moving forward and working with our private developer to identify investors, said Seth Kilbourn, Openhouse’s executive director. “But the Mayor’s Housing Office will help us finance the project since it’s an affordable housing facility.”
In Boston, Mass., Stonewall Communities is another organization with a similar project in the works. All the paperwork cleared to begin building their LGBT elder facility in Kennmore Square. However, according to David Aronstein, founder of Stonewall Communities, city approval coincided with the real estate market crash. That project too is now on hold.
“Construction loans are hard to get,” Aronstein said. The housing community at Stonewall will be a co-op, but buyers are not willing to commit because they don’t want to be in limbo with both their money and their homes, he said.
Non-profit organizations are not the only groups that have suffered. Faith-based organizations are also facing a similar challenge. Spirit of the Lakes, part of the United Church of Christ, has also planned to build a new building for their congregation, as well as have 41 units of limited equity co-op for LGBT seniors.
Spirit of the Lakes already owns the site in South Minneapolis, Minn., and the units are up for sale.
The project stemmed from the unique needs of the congregation of Spirit of the Lakes, as well as the neighborhood looking to create “higher density land use.” Additionally, the project will support the growing immigrant entrepreneurial businesses that are flourishing. Moreover, “to have a 24-hour presence on the street will deter crime,” said Kathy Wetzel-Mastel, who is the project manager of PRG Inc., a non-profit housing developer.
The project initially planned to cater to mixed-income buyers: 20% of the units are intended for households making less than 50% of the median income; 20% of the units are intended for households making less than 80% of the median income, and the rest are to be sold at market rate.
Unfortunately, the co-op project has not met the 70% pre-sale requirement by the HUD loan that is needed to begin building. The problem has to do with the market rate units. “It appears that the interest and the demand is really on those affordable units,” Wetzel-Mastel said. “Some of the folks who are interested can’t even afford the lowest income unit. So there’s been some talk about restructuring the project as a low-income or mixed- income senior rental project.”
The amount of the capital a project needs to raise and the diminishing housing program for low-income tax earners aren’t the only roadblocks on the path to building affordable housing for LGBT seniors.
Mark Supper, executive director of Gay and Lesbian Elder Housing (GLEH) in West Hollywood, Calif., believed that there’s an overall anxiety with all those involved – the organizations, the developers and the lenders – when it comes to starting a multi-million dollar project when times are so uncertain. “It’s a perfect storm,” he said.
“There’s money there,” Supper said, referring to the stimulus and government programs. “Everyone just has to be more creative in the process to obtain the funding to build the project.”
Metropolitan Community Church (MCC), based in Abeline, Texas, is looking for those alternate routes to funding. MCC has received permission and had picked a site for their LGBT senior complex in Sarasota, Fla., near one of their congregations, according to Barbara Crabtree, interim director of operations at MCC.
Although the housing complex will be heavily marketed to the MCC community, it will be open to everyone.
Two years ago, MCC took concrete steps towards creating this facility, but about six months ago, as the banks crashed and the country faced an economic downturn, the project was put on hold.
Crabtree said that after the holiday season, talks would resume on how to get the project back on track. The developer has been obtaining funding, but the facilities units will be sold individually.
“Overall, in affordable housing across the country, it is going to be a devastating situation, from top to bottom,” Supper said.
“We have not given up on it; we are hoping to energize [the project] again,” Crabtree said. “The desire is still there.”