Asheville City Council approves ownership approach to Hilliard affordable housing

360 Hilliard Ave. development plans
CONDO SWEET CONDO: New plans for affordable housing on city-owned land at 360 Hilliard Ave. would develop 64 for-sale condominiums, with 33 affordable units. Screen capture courtesy of the city of Asheville

The third time may be the charm for an affordable housing project on city-owned land that once was home to Asheville’s Parks Maintenance Facility. Having previously approved two other proposals, both of which were subsequently withdrawn before construction started, City Council members unanimously moved ahead with a new plan by Charleston, S.C.-based Kassinger Development Group at its Nov. 13 meeting.

In June 2017, Council had agreed to offer Kassinger a 50-year lease of its land at 360 Hilliard Ave. for a 64-unit rental development including 33 affordable apartments. But the developer, explained city consultant Jeff Staudinger, found that construction cost increases of 25-40 percent since the project’s approval made a rental approach financially infeasible. Instead, Kassinger proposed building the same number of units as for-sale condominiums.

As agreed in Kassinger’s original proposal, the city would still offer a $1.28 million, 2-percent loan from its Housing Trust Fund to help finance the project. However, Kassinger would also buy 1.7 acres of the 2.7-acre property outright instead of leasing it — at half of the appraised value, representing a $375,000 total subsidy and $12,098 per affordable housing unit. This benefit would replace a previously agreed Land Use Incentive Grant, a program only available to rental projects, which had an estimated value of $385,000.

The city would retain the other acre of the property, on which Kassinger would build (and pay half the cost of) a new parking lot for the nearby Aston Park Tennis Center. The developer would also actively market the affordable units to Asheville Housing Authority residents, with an “aspirational goal” of selling 20 units to those households.

Vice Mayor Gwen Wisler raised questions about Asheville’s ability to enforce the agreed-upon 50-year affordability period once the city let go of its land ownership. Future Councils could easily revoke a lease if Kassinger broke its promise, she said, but a sale might leave few options “other than taking them to court.”

Staudinger said that the deeds to each individual condo could be restricted such that future sales were limited to households meeting the income qualifications. Furthermore, he suggested that the Asheville-Buncombe Community Land Trust could be offered the right of first refusal at the affordable price for all sales.

“If employed, [that mechanism] could actually extend that 50-year period on to a far longer period — in fact, permanent affordability, as permanent as the state of North Carolina allows, which is 99 years,” Staudinger noted.  

With those concerns allayed, Council members praised the plan as a creative housing solution. Keith Young, who voted against Kassinger’s original proposal, called the new project a step toward fighting gentrification and a welcome change from policies focused on affordable rentals.

“This would be the first project before Council that would directly secure ownership opportunities for those at the lower price points of our community,” Young said. “That directly contributes to providing generational wealth to those who would not otherwise have an opportunity in such an expensive and desirable area as downtown.”

Council member Julie Mayfield agreed, noting that she had voted earlier this year with Young and Sheneika Smith on the Housing and Community Development Committee to add language about affordable homeownership to city policy. “I don’t want to say it’s a great experiment — I think it’s going to be a great success,” she said.

No community members rose to speak about the project before Council gave its unanimous assent. According to Staudinger, land clearing on the site is scheduled to begin in February, with construction to commence in March and project completion to follow within a year.

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About Daniel Walton
Daniel Walton is the Green Scene editor and a reporter for Mountain Xpress. His work has previously appeared in Capital at Play, Edible Asheville, and the Citizen-Times, among other area publications. Follow me @DanielWWalton

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12 thoughts on “Asheville City Council approves ownership approach to Hilliard affordable housing

  1. luther blissett

    “That directly contributes to providing generational wealth to those who would not otherwise have an opportunity”

    Maybe some day they too can become property developers and renege on a deal for a leasehold with a city council, then get a sweet $1.2 million loan to buy city-owned land at a 50% discount? How “creative.” Let’s come back in a year’s time when the developer has decided that a restricted deed is too onerous. And I’d like to see the raw numbers that back up the claim of “construction cost increases of 25-40 percent” over the past 17 months.

    • Enlightened Enigma

      builder grade construction costs seems to have jumped from $90-100 to $125 per square foot overnight and contractors cannot guarantee costs on materials fast increasing…

      • luther blissett

        If it’s a short-term spike in materials (“trade wars are good, and easy to win”) then more reason to pause on the development to see how it resolves. If the cost spike is driven by wages, then that would require a more thorough reassessment.

        The more I think about this, the less it makes sense. If “affordable” units are priced at $135-155k for people on below-median incomes, then who’s going to provide the mortgages? Who’s going to afford a downpayment?

        • Lulz

          It’s not materials insofar as labor. Mission’s new building has sent the cost of labor up. And that’s a good thing.

  2. Enlightened Enigma

    WHY must City Council continue to try to control the market? It’s just not their business. This project, as presented, smells of future failure. Investors will not be amused. Get out of the way, city.

    • Lulz

      I’ve read the words of the leftist buffoons who can’t wait to proclaim they’ll pay more to the city in taxes for the place they want it to be. Me thinks that they should pay higher rents from now and stop complaining. Not the 1500 a month but 2000 , 2500, and 3000. Why should they be fleeced by the cronies alone? If they want to be fools then I won’t stand in their way and neither should you. Let them compete with each other in the rat race to see how much money they’ll pay for the place they assume they’ll get. Enough of trying to reason with a bunch of morons hell bent on working for high taxes and a corrupt government.

    • luther blissett

      I agree with this, though probably for different reasons. Affordable housing only works if it’s forcibly disconnected from the property market. The original proposal attempted to do that. The revised proposal doesn’t.

  3. North Asheville

    The Council is to be commended for giving consideration to this affordable home ownership plan.

    • Enlightened Enigma

      No, No…they are NOT to be commended for anything like this…nor many of the other things they do!

  4. jason

    So these units will be sold to people who can’t afford repairs, upkeep, taxes etc…This place will be a dump in two years.

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