Portland’s affordable housing community raises the bar again
In the first quarter of 2009, financing on only one affordable housing project closed in the state of Oregon: the Madrona Studios project. On March 10, that project opened for business. Now, those most in need can start to move in to this signature development with national implications for housing low income populations.
Madrona Studios is an ambitious undertaking designed to place hundreds of poor and often homeless Portland residents in comfortable, affordable studio apartments. Located just north of The Rose Garden/Coliseum complex on Northeast Broadway Avenue in what was once a largely African American neighborhood, Madrona represents a major step forward in affordable housing in Oregon and beyond.
In a celebration in a meeting room in Madrona Studios today, housing execs and pols heaped praise on the project. It was richly deserved. Central City Concern, a nationally recognized urban social service agency, took a sagging Ramada Inn and turned it into a showcase for affordable housing.
But a more compelling validation of Madrona’s significance came from a virtually unseen man in a purple shirt standing in the back of the room. Miguel Tellez, a longtime Portland drug and alcohol counselor, a man whose addiction had led him to prison and beyond, gasped in amazement when he heard that 176 homeless and near homeless individuals would be able to live in the clean, hip studio apartments at Madrona. And he shook his head in disbelief when he learned that the Hooper Detoxification and Stabilization Center, a multi-day residential and detoxification services facility, would also be housed at Madrona.
“My goodness, this is unbelievable,” Tellez whispered. “Simply unbelievable!”
Madrona Studios is the sort of public project other cities dream about but Portland delivers.
“The unique thing about the Madrona Studios is the co-location of affordable housing and a recovery center. While, to a large degree, they’re functionally independent of one another, together they represent the spectrum of services and approaches that are needed to help people improve their lives,” says Central City Concern’s Sean Hubert, director of housing and development. “Housing does not exist in a vacuum. It’s part of the fabric of a community and is only one element of what makes a person, a community, and a city healthy and vital. I think this larger vision, which Madrona Studios highlights, is representative of the true overall mission of affordable housing.”
Central City Concern took on the aging hotel and dictated that it would create an energy-efficient first-class facility for the poor with green building practices and the detox center located within to demonstrate the range of services available at Madrona.
Previously, the building housed The Ramada Inn/Rose Quarter. Fallen into disrepair, Central City Concern proposed a complete rehabilitation for the aging structure. CCC’s proposal called for turning it into housing for three tough-to-house groups: homeless individuals; Central City Concern clients in need of stable housing; and low-wage urban workers who were being priced out of most of Portland’s rental housing market.
But, says Hubert, it almost didn’t happen. What kept the dream alive was a partnership with a low-profile nonprofit called the Housing Development Center.
“Madrona was a particularly tough deal,” Hubert says, recounting how the collapse of worldwide financial markets caused nearly all affordable housing dollars to vanish overnight. “You bring in Housing Development Center to structure a deal. They know the players, they’re used to putting together a number of sources. But this required twice as many sources as usual. Still, they got it done.”
When Central City Concern first floated the proposal in 2004, the Portland housing market was in superheating mode. The construction costs, Hubert said, seemed to escalate daily. Then the housing and credit markets collapsed. Now the challenge became falling tax credit prices and a very tight lending environment.
But Housing Development Center delivered, as it had so many times in the past. It patched together 23 distinct funding sources–including US Bank and Wells Fargo–to raise the $19 million required for Madrona’s renovation. Housing Development Center “brings weight to the table, they get everyone going,” Hubert says. “They get the job done, time after time, even when you’d think it couldn’t be done.”
Putting the loans in place is just one critical role played by Housing Development Center’s team. Led by veteran project manager Craig Kelley, Housing Development Center assisted with the construction and asset management aspects of the Madrona Studios project. When the construction phase of Madrona closed, the project came in under budget, largely thanks to Kelley’s eagle eye on spending, Hubert says.
Housing Development Center’s work didn’t end with the Grand Opening either. The team stays with the partnership to the point where the facility reaches a stable occupancy, handling final paperwork associated with the project, making sure each unit meets the owner’s expectations, and generally doing what needs to get done so that 176 people can have a decent place to call home.
Because of Portland’s commitment as a community to ending homeless, it boasts groups like Housing Development Center with special expertise in areas of affordable housing construction and financing that one might not find in other cities. These Portland based organizations are looking beyond Portland for clients, in part to expand thinking nationally about what can be achieved to create good housing for the poor.
Hubert thinks other cities have an opportunity now to take a closer look at converting aging and underutilized motels and hotels into viable housing for the poor.
“I think [Madrona] is very replicable and the conversion of hotels into affordable housing is the cheapest way that I know of to bring on new units of affordable housing,” he says.
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[...] Portland’s affordable housing community raises the bar again … [...]
It is so sad that this place is good news. Bear with me, please.
What do you consider a ‘living wage?” How much you are willing to pay for your groceries, your widgets, and your next tune up at a jiffy lube?
Because whenever you talk about “pushing down wages” you are also talking about ‘keeping down prices’. Yes, profits to corporations are large; they are capitalistic institutions, and their corporate charter is to maximize profits. Labor being the lions share of production cost, low wages make consumer prices lower. (This is not the thread to thought experiment about what might happen to prices if health care costs were not part of the employers cost of production or a tirade on viva la revolution, citizen – much fun as that would be.)
When Bob mention’s that there are two separate issues at play here, welfare housing for those not working, and a place where a low wage worker can afford to live, I agree wholeheartedly. I first read the headline thinking that when Dan referred to affordable housing, he wasn’t going to be talking about low income/subsidized housing. But I’ve run some numbers, and….. low income subsided housing and affordable housing for the ‘working poor’ are, actually, sadly indistinguishable.
Let me explain; Specifically looking at the Madrona. Can we agree that the market this project is aiming to serve are folks who would otherwise be sleeping under bridges with a bottle in their hands? Seems plain enough to me, since they’ve placed the detox center in the lobby (ok, ok, Dan- that’s an overstatement, the detox center probably has a separate entrance, around the corner or something)
Still, the picture painted for me by these stories is one of someone moving from the detox center, steadily up the floors into their very own studio as their addiction comes under control. (temptation to relapse with junkies all around at all hours is a valid concern, but I’m really trying not to digress) Noble, and necessary- drunks under bridges are not good for general social welfare, giving them dry beds is ok with me.
How these homeless, crawling out of addiction folks will pay the rent on these units is, I imagine, via their disability checks or their section 8 housing vouchers. They will qualify for food stamps, and voila, no more dying in the streets! There are undoubtedly enough people in these dire straights in Portland metro to fill the Madrona many times over. The building was falling into disrepair and a blight, now it has a good practical use. So, great! This is a wonderful place to keep our unfortunates (ah, word choice) off the streets at night.
Now lets look from the perspective of the so called ‘working poor’. Does this housing complex have a benefit for the low earners who ARE working? I’ve run through some numbers.
The rents on these studios (studios. a 10×10 room and a kitchen and a toilet, noise leaking in from all 4 sides) range from $400 to $490, depending on the view, utilities included. Let’s call it $450.
Income restrictions on the units put a max for single occupancy income at $24,500 per year. This pencils out to a full time worker earning $11.50/hr – good retail, basic services – a more difficult wage to procure these days than you might imagine, practically a kings wage to many.
But these lucky ones can live in a studio apartment for about 27% of their income.
Traditional wisdom recommended 25% of income toward housing (utilities included, which the Madrona provides) and that percentage has been upped to 33% by ugly long-term economic forces I need not detail here. So our $11.50/hr worker, after paying rent, will have a little over $1000/mo left over (assuming 20% payroll deductions, about what I saw come out of my checks at that wage -after declining the luxury of medical insurance). This is could be that hard first step out of the poverty trap!
$125/week for food, $100 month for a bus pass, $50 a month for laundry quarters… that’s a few hundred dollars left over at the end for savings, education, entertainment (don’t they deserve? they are, after all, working hard for their dollars) and, oh, those nickels and dimes that add up, so quickly, under the mystery heading “incidentals”. (Heaven forbid an accidental overdraft at $35 a pop, again, I digress).
A frugal life, a careful life, but not impossible for a clean hardworking soul with some old-fashioned determination and drive.
To do so at the Madrona, however, they will still need to tromp through the lobby of a building that also houses a detox center. They are no better, really, than their neighbors, poverty being relative and all.
Remember – this is not a Walmart cashiers starting wage we’re working with. This is a Walmart department manager or pharmacy tech, an entry level cna, or a technical support rep at the call center (in Beaverton). Those jobs may not require a 4 year degree, but they do require skills, often a certification, and represent what could, in a ideally distributed world be called a career- if we didn’t have a socially ingrained desire to spend all our lives class jumping until we reach the corner office.
And ya’ know what.. these jobs pay $11.50 an hour. That is what they pay. They will adjust for inflation, and barely match the increase in the cost of bread, but that is what they pay because that is the portion of the cost of production calculus that these ’some skills required’ positions merit. We need people to do them, but raising their wage to $15 or $20 an hour would only spread increased cost over everything else, and they would be right where they are now, no better, maybe even worse.
What are their other options?
A craigslist search on ’studio’ with a max price of $490 returns only 55 results. Many of them are $150-200/week rooms – overshooting the $490 per month price tag, the rest are far away from the central city (Oregon City, Wilsonville — adding hours each day of commute time to that $11.50/hour job if it’s in Portland proper). None of them are lovely places to live.
I do not mean to disparage… too much….. it really is a good idea to turn old useless hotels into places where people can stay dry at night. but when they put Hoopers in the same building this became 176 units of great news for junkies. That’s what it is, and that’s ok… that really is great news.
But saying this is great news for affordable housing is ….hell, Dan, it’s just bullshit…. once you get over the ‘living wage for everyone’ fantasy and see the reality of how much it really costs to live indoors, the price for housing junkies at the Medrona still is too high.
Why not support a living wage instead of affordable housing? That way we aren’t ultimately subsidizing corporate profits.
Many of the people who live in affordable housing don’t work, Bob, so a living wage wouldn’t have much impact on their housing choices. Sadly, though, a growing percentage of those who can’t afford decent housing are working–two and three jobs, in many cases. The trouble with today’s “solutions” is that everyone wants to tighten or loosen just one screw somewhere instead of taking an integrated approach toward problem-solving. To truly help the people who will live in Madrona Studios, we need affordable housing, access to decent health care for everyone, a living wage for all workers, a good, free education, and so on. I thought the true/slant piece on the Kansas City schools addressed this point very succinctly.
In response to another comment. See in context »I think there are two separate issues, welfare for those who will always need it and affordable housing for the working poor. I think the greatest number of people will be helped by creating a living wage. As to health care, it isn’t so much about access as about controlling costs. We pay 2.5 times more per capita in the US as in the UK. Again, we’re back to corporate profits trumping all other considerations in our society.
In response to another comment. See in context »Well, Bob, we are the nation that fine-tuned capitalism, adding that twist of socialism designed to benefit major campaign contributors. You can talk about Utopia but most of us are stuck living in Kansas City. People need to be housed decently now, not after the revolution. And you and I both know it’s gonna be a very long time before wages rises again. The class structure in America is more rigid than at any time since the Great Depression.
In response to another comment. See in context »Yes, people need to be housed now. But the long term solution is to recognize that poverty is institutionalized as a benefit to big business, which demands a minimum of 4% unemployment so as to keep labor costs down. Government and philanthropy has to clean up the mess while those guys party in the front of the bus. Privatization of profit; socialization of cost and of risk. Some fine kettle of kapitalism we got ourselves into, Ollie.
In response to another comment. See in context »One example of this, one that progressives are terrified to discuss, is our high levels of immigration, especially how we wink at illegal immigration. It bids down wages and it costs a lot to assimilate and service them. Biz gets cheap labor and new customers, we get the taxes, the congestion, the sprawl, the crime, the welfare costs, all the while watching jobs that once supported families become jobs that require taxpayer support.