CASE STUDY: The vagabond group & omni cra public-private affordable housing partnership
Rendering of 1540 & 1550 NW 1 Ct
BACKGROUND
On February 22, 2018, the Omni CRA Board unanimously approved a public-private partnership between developer Avra Jain of The Vagabond Group, the Omni CRA, and the Mt. Zion Community Development Corporation (CDC) to renovate forty-four units over five garden-style apartment buildings in the Historic Overtown neighborhood. By preserving the architectural character of the early 1950s buildings, the project will provide much needed quality affordable housing to existing residents while contributing to the social resiliency of the neighborhood and the City of Miami as a whole.
SIZE
The development will consist of forty-four affordable and workforce rental apartments over five buildings located at in the Historic Overtown neighborhood. The unit mix consists of (6) three-bedroom, two-bathroom units, (6) two-bedroom, one-bathroom units, (20) one-bedroom, one-bathroom units, and (12) studio units. The three contiguous parcels cover 29,400 sf of land and 20,312 sf of total building area over two-stories. They border the Overtown CRA along the north-south axis of NW 1st Pl, and provide a critical node to one of the more challenging areas bounding the Omni CRA district.
WHY IS IT SIGNIFICANT
This landmark project was the first issuance of Tax Increment Financing (TIF) funding from the Omni CRA towards their affordable housing mandate. A case study project, several important factors were critical to the success of the project as a true community-wide benefit: no off-site displacement of existing residents during construction, no increase of rent to existing tenants, improved quality of life for existing residents, a true historic restoration of the properties including all major system upgrades, utilization of local construction crews, and community outreach and involvement. To create a more equitable community, providing safe and quality affordable housing through public-private partnerships is a key factor to improving residential health and financial stability.
PARTICIPANTS
Avra Jain, The Vagabond Group; Omni CRA; Mt. Zion Community Development Corporation
A case study project, several important factors were critical to the success of the project as a true community-wide benefit: no off-site displacement of existing residents during construction, no increase of rent to existing tenants, improved quality of life for existing residents, a true historic restoration of the properties including all major system upgrades, utilization of local construction crews, and community outreach and involvement.
PROJECT FINANCING & DEVELOPMENT COSTS
The proposed project will be developed in partnership with the Omni CRA with a $3.8 million forgivable loan after satisfying the 30-year Affordable Housing Covenant. The property was purchased for $3.7MM (~$83,000/unit) and allocated $2MM (~$45,000/unit) for renovation costs, with a total development cost of $6.6MM (~$150,000/unit). On the $3.8MM investment, the Omni CRA will achieve an approximate $8MM rental subsidy (monthly savings of $320/unit) for existing residents compared to the allowable AMI rents. Essentially a buy down of “vouchers” had it been a Section 8 project. The local partner, Mt. Zion Community Development Corporation, will have a 7.5% ownership interest in the value of the improved and maintained property at the end of its 30-year cycle. This project demonstrates the importance of providing an efficient means of public-private funding while improving community-wide social benefits.
Written and researched by Laura Weinstein-Berman