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AHC Inc. Opens 83 New Affordable Apartments on Columbia Pike

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Dozens of supporters, community residents and local officials celebrated the grand opening of The Shell on May 14 in Arlington, VA.

AHC’s newest building provides 83 affordable new homes along Columbia Pike for individuals and families earning between 50% and 60% of the Area Median Income (AMI).

The six-story apartment building includes 5 three-bedroom apartments, 63 two-bedrooms, 10 one-bedrooms and 5 efficiencies. Nine of the apartments are handicap accessible and six are part of the permanent supportive housing program of Arlington County.

The demand for affordable housing in Arlington continues to grow. Since 2000, Arlington County has lost 13,500 market affordable apartments. Reflecting the ongoing need, The Shell’s waiting list quickly grew to more than 650 individuals and families before AHC stopped accepting additional applications.

Planning for The Shell began when AHC discovered a gas station at the corner of Columbia Pike and South Greenbrier Street in Arlington was available for sale. Always on the lookout for potential building sites, AHC began exploring the idea of combining the gas station property with undeveloped land that it owned next door and adjacent to its Harvey Hall Apartments. Several years later, that idea became a reality.

Today, the building features an 800-square-foot community room, a fitness room, ample underground parking and a plant-filled central courtyard.

AHC also incorporated several green features at The Shell to reduce electricity consumption and water usage. The building has a green roof as well as Energy Star appliances, energy efficient heating and air conditioning, and WaterSense faucets, showerheads, and toilets. An on-site storm water filtration system was installed to reduce runoff and improve the quality of rain water draining into local waters such as the Potomac River and Chesapeake Bay.

“AHC is committed to developing top-quality buildings that not only provide welcoming homes for working families, but also include architectural elements and energy-efficient features that improve our residents’ quality of life, enhance the community and stand the test of time,” said Walter D. Webdale, AHC President and CEO.

Located at a busy corner along Columbia Pike, the Shell also includes 6,600 square feet of retail space. The building was the first project to receive approval under Arlington’s innovative Form Based Code, which encourages a blend of housing and commercial spaces to create a lively, walkable community.

“As Columbia Pike redevelops, the County is working to ensure that the Pike continues to be a vibrant place for people at all ages, stages and incomes,” said County Board Chair Mary Hynes.  “We’re proud that, by partnering with AHC using our affordable housing loan program (AHIF), our public-private partnership at The Shell will provide affordable housing AND retail for its residents and the greater neighborhood.”

Financing for the $32 million project included loans from Arlington County’s Affordable Housing Investment Fund (AHIF), Capital One, Virginia Housing Development Authority, AHC Inc., and 9% Low-Income Housing Tax Credit equity from Hudson Housing Capital. Other partners include NeighborWorks America and EarthCraft Virginia.

The Shell was designed by Cunningham l Quill Architects and built by Harkins Builders Inc.

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Founded in 1975, AHC Inc. is a nonprofit developer of affordable housing in the mid-Atlantic region that provides quality homes and education programs for low- and moderate-income families. Based in Arlington, VA, AHC has developed more than 6,500 apartment units in 49 properties in Virginia and Maryland. AHC’s Resident Services program reaches 2,000 children, teens, adults and seniors each year through onsite education programs and activities.

Innovative Financing Strategies

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Financing and developing affordable housing is challenging – especially in dense urban areas like the Washington, DC, metro region. To become more nimble in today’s competitive market, AHC Inc’s multifamily development team is creating innovative financing strategies that go beyond traditional affordable housing tools.

In Arlington, VA, AHC partnered with such organizations as Freddie Mac, Arlington County and the Low-Income Investment Fund (LIIF) to create financing structures that did not rely on the traditional affordable housing tools of Low Income Housing Tax Credits or tax-exempt bonds. The strategy helped AHC move quickly in a competitive marketplace to successfully preserve two mixed-income properties, The Serrano and The Spectrum, with a total of 380 units near the gentrifying Columbia Pike area.

And, in another non-traditional partnership, AHC joined with Housing Partnership Equity Trust (HPET), a social purpose real estate investment trust (REIT), to acquire Woodleaf, a 228-unit apartment community in Silver Spring, MD — the first such partnership in the DC region. HPET is the first affordable housing REIT created and managed by nonprofits; AHC is one of 12 nonprofit housing developers in the collaborative.

AHC also made full use of existing affordable housing tools by pulling together funding from a variety of sources. For instance, AHC combined Low Income Tax Credits, tax-exempt bonds and Historic Tax Credits to finance the $110 million renovation of Woodbury Park, a 1940s historic garden-style community with 364 mixed-income apartments in Arlington, VA. The extensive financing package did not require local housing funds from Arlington County’s Affordable Housing Investment Fund (AHIF).

Photo: Woodleaf in Silver Spring was the first acquisition by a social purpose real estate trust in the DC region.

Affordable Housing for an Aging America

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Every day, 10,000 Baby Boomers turn sixty five years old.  In Arlington, one in five residents will be 60 or older by 2020.  As the number of senior citizens grows, affordable living opportunities for older Americans are becoming an increasing need.

AHC currently operates three apartment communities for senior citizens. All provide programs and staff to help residents age in place successfully.

 Hunter’s Park, in Arlington’s Cherrydale neighborhood, opened in 2005 with 74 one-bedroom apartments. The property includes welcoming common areas, including a living room with fireplace, library and rooftop patio. Activities abound, including exercise classes, book club, gardening workshops and special birthday celebrations. The vibrant environment helps keep seniors active and engaged.

MonteVerde Apartments, in Baltimore, serves 301 senior citizens and physically disabled individuals. AHC purchased and completely renovated the property in 2008. Today, AHC’s Resident Services staff help connect residents with the local services they need to live independently and improve their quality of life.  The property provides a shuttle service to local retailers, a library, arts and crafts room and game room lounges, nutrition and wellness programs.

 Charter House, in Silver Spring, MD, has 212 apartments for individuals aged 55 and older. Located near the Silver Spring Metro station, the 14-story building is within walking distance of lots of shops and activities. AHC assumed management responsibilities in mid-2014 and is working on building stimulating programs and activities with such partners as the Fenwick Foundation, which provides a wide variety of social programs and field trips for AHC’s senior citizens at other properties.

 Photo: AHC operates three communities for aging Americans.

Creative Smart Growth Strategies

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One of the biggest advantages of smart growth – housing built in walkable neighborhoods located near mass transit, grocery stores, and shops – is that it creates desirable communities and draws homebuyers. A National Association of Realtors survey found that more than half of respondents preferred a smart growth neighborhood to a suburban subdivision.

But smart growth demand also can have a downside – limited housing stock and high development costs — which makes building transit-oriented affordable housing particularly challenging.

But it doesn’t have to be that way.

In Arlington, Va., AHC Inc. has a track record of using creative ideas to build affordable housing in dense urban areas, where land can be expensive and scarce. Some of its approaches – from land swaps to creating land – could be replicated elsewhere as well. AHC’s experience provides examples of how affordable housing can be a key part of a smart growth strategy, helping to reach the goal of creating communities that are diverse, as well as desirable.

Here’s a look at some of AHC’s projects and strategies – and some of the challenges overcome.

 Swapping Land

Community concerns about density and building heights are a common challenge in smart growth areas. To move forward such a stalled project, AHC engineered a land swap with a prominent developer to reconfigure a multi-pronged project that included affordable housing along with high-end townhouses and 450,000 square feet of office and retail space. The land swap moved the townhouses next to existing single-family homes and nestled AHC’s 90-unit, four-story building closer to the retail and commercial spaces. AHC’s building, The Jordan, which encloses a welcoming courtyard, is separated from the larger buildings by an urban greenway.

 Using Nontraditional Spaces

With space at a premium in Arlington’s dense Metro Corridor, AHC transformed a parking lot next to an existing affordable garden-style apartment complex (Woodbury Park) into twin nine-story buildings – one affordable and one market rate. The condo (The Park at Courthouse) helped subsidize the affordable housing apartments. A passerby couldn’t tell the difference in the buildings, which are connected by a brick-lined courtyard. The end result: On a site just 1/4 mile from the Courthouse Metro Station, AHC created The Frederick with 108 affordable apartments, a 4,300-square-foot community center with onsite Resident Services programs, underground parking, and play areas for children.

 Photo: Twin buildings – one affordable (The Frederick on the right) and one market-rate (The Park at Courthouse on the left). 

AHC Posts $331M in Development in 2014

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As housing costs escalate and the number of affordable apartments dwindles, AHC is working hard to create innovative partnerships and financing opportunities to preserve and develop housing opportunities in the VA-MD-DC region.

In 2014, AHC’s multifamily development team closed on eight transactions with a total development value of $331 million and containing more than 1,400 units — pushing AHC’s total multifamily portfolio above 6,500 units.

AHC also has two affordable apartment projects under construction – the 83-unit Shell in Arlington is opening its doors to families this spring, and the 78-unit Jackson Crossing in Alexandria (opening late 2015).

Underscoring the complexity of today’s housing market, no two developments were alike.

AHC’s 2014 projects include the acquisition of six existing rental communities containing 975 apartments, construction of 76 rental townhomes, and the redevelopment of an existing AHC-owned, 364-unit, historic property.  The apartments are primarily located in the metro region’s high cost-of-living rental submarkets in Arlington, VA and Montgomery County, MD, along with developments in the District of Columbia and Baltimore.

The projects utilized a variety of financing strategies, reflecting the challenges involved in assembling funding in the current marketplace. Several transactions were completed with innovative financing structures that relied heavily on market-rate tools and deal structuring techniques.

The properties provide homes for households with a variety of incomes, ranging from conventional affordability levels (50% and 60% Area Medium Income) to workforce housing (80% AMI) to full market-rate homes.

 Photo: The Shell in Arlington opens its doors to families this spring.