Building affordable housing not so affordable
Some affordable housing developers question Portland's claim that more expensive projects pay for themselves over time.
The high cost of creating publicly supported affordable housing projects in Portland came into sharper focus over the past week.
On June 1, Oregon Housing and Community Services announced it was recommending grants to nine affordable housing projects in different parts of the state. The state agency that helps fund such projects said the most expensive ones were in Portland. According to the announcement, the costliest was the North Williams Apartments, which is being developed by Bridge Housing for $387,468 per unit. The cheapest outside of Portland was the Claxter Crossing Apartments, being built in Salem by North River Development, which will cost $121,520 per unit.
Then on June 5, Mayor Ted Wheeler unveiled the first new apartments being purchased with the city's affordable housing bond. The building nearing completion at 105th Avenue and East Burnside Street will cost $275,000 per unit. The City Council is expected to approve spending $14.3 million of the voter-approved $258.4 million bond on it this Wednesday.
And on June 7, the Metro Council referred a $652.8 million affordable housing bond to the November general election ballot. The regional government estimates the cost of the new projects it will finance at $253,186 per unit. Preservation and renovation of existing housing is estimated at $225,180 per unit.
There are many reasons why the costs in Portland are so high. For starters, land prices in the city are the highest of anywhere in the state. Construction costs also are high because of the shortage of workers and the number of other projects already underway, in addition to the requirement that contractors pay the equivalent of union wages on publicly funded projects.
The council also has approved a number of goals for city-funded projects that increase costs. They include locating them in desirable areas near transit and other amenities, where land costs are especially high. The council also wants such projects to last up to 100 years, which means they must meet high standards. And the council wants them to include such features as common rooms and open spaces for the residents, and to be energy efficient, all of which increases construction costs even more.