If you believed that Nishi would come down to issues like traffic impacts on Richards or connectivity promises to the university or even air quality, you may end up being right, but the early battle seems to be on the issue of affordable housing.
Opponents of Nishi are arguing that the city gave away millions to the developer in affordable housing commitments. Supporters can counter that adding 1500 beds to the city, at a time when the city is facing a student and rental housing crunch, will only help affordability.
As we noted on Sunday, the opposition argues, “Nishi’s housing will not be affordable nor designed for students as promised. Because the City exempted the project from its low-income housing requirements and millions in alternative in-lieu fees, Nishi’s housing will all be luxury rental apartments and for-sale condominiums. Independent analysis projects rent for an average 1,100 sq. ft. 2-bedroom, 2-bath apartment at over $2400 a month!”
In the rebuttal to the argument in favor they add, “Rental units are not ‘oriented towards students…with small units,’ as claimed. Instead, apartments are very large (average is 1,100 sq ft 2-bedroom, 2-bath) and affordable only to the richest students.”
Proponents note, “The project will provide 440 multi-family rental units oriented towards students at the edge of campus obviating the need for car travel for residents.” They add in their rebuttal to the argument against Nishi, “Students, seniors, and workers need affordable, small, efficient multifamily units in the core area within walking distance of campus and downtown. This reduces costs of living, car trips, traffic, and our carbon footprint.”
The developers argue that, without the rental units and the up to 1500 new beds, rents will continue to skyrocket in the city. UC Davis continues adding up to 1000 additional students each year, increasing enrollment as well as market demands.
The argument that proponents are making is that, with the additional supply of housing, Nishi will put pressure on older rental units to lower their rents in order to compete with the new supply from Nishi.
This links into the article the Vanguard published on Monday highlighting council candidate responses to the need to resolve the rental housing issue. As was pointed out in the comment section, the answers focused mostly on working with UC Davis to expand their commitments to student housing, but for the most part failed to address the city’s end of the equation.
Councilmember Brett Lee noted, “We have several proposals before us – most of the problems I have with them are size and scale. They can be scaled down. There haven’t been any large apartment complexes in quite some time.”
However, interestingly enough, the biggest issue before the voters this spring is Nishi, and none of the candidates mentioned Nishi as a possible solution to alleviate some of the rental housing crunch.
Large “A” – Affordable Housing Requirements
Meanwhile, the lawsuit filed by Michael Harrington continues to demonstrate confusion on Affordable Housing requirements (large A this time, rather than general affordability).
The city’s explanation of the Affordable Housing Contribution comes out of a November 2015 staff report which states, “The current affordable housing ordinance exempts vertical-mixed use rental housing and stacked-flat condominiums from inclusionary requirements. This was reflected in preliminary draft deal points presented with the predevelopment agreement in 2012.”
The November 27, 2012, agenda includes a note, “If residential density is greater than 30 units per acres gross, no affordable housing obligation or fees.”
Opposition notes that there is no clause in the pre-development agreement indicating a deal on Affordable Housing. It should also be noted that the city has revised its Affordable Housing policies at least twice since 2012.
The question of the legality of these actions is unclear. As the Vanguard has noted, the city’s Affordable Housing ordinance is a local document that can be changed and altered with three votes.
In July 2013, the city council by a 3-2 vote approved a measure to allow accessory dwelling units to count toward Affordable Housing obligations – with no requirements that those ADUs adhere to affordable regulations.
This allowed the city to include 35 of the 40 ADUs at Cannery to be counted toward meeting Affordable Housing Element requirements.
A little over a year later, in September 2014, the council voted 3-2 to rescind that decision.
Clearly, it takes just three council votes to change the Affordable Housing ordinance. The question for the courts is whether the city is correct that the Nishi project is exempt from the city’s Affordable Housing ordinance, but, even more importantly, does it even matter if it is? After all, if a council can take a simple vote to alter the ordinance at their whim, perhaps they do not need to alter the ordinance, but rather simply agree to a provision of Affordable Housing on a site-by-site basis.
That was the explanation I was given a few months ago – the council has the authority to alter the applicability of the ordinance as it sees fit.
If this is accurate, then the Affordable Housing ordinance is relatively toothless. The ordinance can force a developer to adhere to Affordable Housing requirements, but the city council can do that through the development agreement anyway.
The city council or community, if it really cares about large “A” affordable housing, can pass an Affordable Housing ordinance at the ballot box. This would force the city council to adhere to the ordinance or go back to the voters for changes, or it can write Affordable Housing requirements into the next version of Measure R.
Short of that, three votes on the council seem sufficient to change the ordinance as the city council sees fit.
—David M. Greenwald reporting
“The argument that proponents are making is that with the additional supply of Nishi will put pressure on older rental units to lower their rents in order to compete with the new supply from Nishi”
“There haven’t been any large apartment complexes in quite some time.”
Now I am not criticizing Brett whose approach I greatly admire, but the statement “in quite some time” is a bit vague. In the 25 years that I have been in Davis continuously, there has always been a major housing shortage for students. A number of large apartment complexes have been added to the city within that time frame ( perhaps Don could provide a list, although I believe he has done so before ) and yet they have not come close to alleviating let alone solving the problem. I do not see continuing to do what has been demonstrably unsuccessful in the past is a good plan.
Please note that I do not pretend to know what “a good plan” would be given the city’s obvious inability to leverage UCD into doing anything that it does not want to do, namely slowing growth sufficiently to allow for the housing of its students in a responsible manner. But I do not believe that buying into the current “more is always better” philosophy currently dominating UCD is likely to be a helpful approach since it has already proven not to be.
David wrote:
> “Tuesday” Morning Thoughts: Affordable Housing as the Surprise Issue in Nishi
Were you really “surprised” (be honest)?
The people that want to preserve Davis home and condo values can’t just come out and say “we want stop residential development so the value of the real estate we own to goes even higher” so they will keep looking for other things to kill any new development, from “protecting kids” to “protecting farmland” finding some “endangered species” to “protect” (I won’t be “surprised” if they find a rare lizard in the next month).
> Independent analysis projects rent for an average 1,100 sq. ft. 2-bedroom,
> 2-bath apartment at over $2400 a month!”
Who is the “independent analyst”? Forgetting the unrealistic rent (that is higher than any 2-bedroom apartment rent in Davis or even the West Village) can anyone name a a single apartment built in 30 years that has 1,100 sf 2-bedroom units? Only an idiot would build a 1,100 sf 2-bedroom apartment in Davis when they could get about 25% more rent by throwing up a couple walls and turning them in to 1,100 3-bedroom units (the developers of this project know more about apartment renting than the rest of us combined so I’m pretty sure they are NOT planning to build “apartment” units that are bigger than most 2-bedroom “homes” in built in Davis before the war).
Following are the size and number of apartments in the Baseline features of the project as approved by Council. The median size apartment is 1,100 sq. ft. 2-bedroom, 2-bath apartment.
Nishi Residential Square Footage
Unit Type Sq. Ft./Unit No. of Units
Studio 580 44
1 Bdrm – 1 Bath 780 132
2 Bdrm – 2 Bath 1,100 88
3 Bdrm – 3 Bath 1,320 44
4 Bdrm – 4 Bath 1,600 132
The projected residential rent for the project is given in Table 2 (2nd Page) of the memo to Mike Webb on January 8, 2016 from Goodwin Consulting Group entitled Preliminary Analysis of Infrastructure Funding Alternatives – Nishi Property Development Plan.
“Rent per Square Foot/Month $2.20 per square foot (average)”
Thus, 1,100 sq. ft x $2.20 per sq ft = $2,420
“Only an idiot would build a 1,100 sf 2-bedroom apartment in Davis …” South of Davis
John Whitcombe may be a lot of things, but he’s definitely not an idiot.
I can accept that we might not really know what the rents will be yet (though all indications point to over $2100/month) but are you telling me we don’t know yet what they are actually proposing to build? Times have changed as far as what space people want and will pay for (even though my 3BR 1955 house was 1060 sq. feet before I added a working studio to it in 1992). In fact if they did make them 3 or even 4BR, that would go a long way toward better addressing and having value for the rental crunch. But my talking about it does not even begin to move that toward a reality. Someone mentioned in a previous Vanguard piece comment last week that it is anticipated students will make them 4 to a unit to even begin to make them affordable at $600 each per month. That’s just awful but I think that is reality. But I doubt students who are cheering this on realize how high the rents will be.
dlemongello wrote:
> I can accept that we might not really know what the rents will be yet.
We don’t know what the rent “will” be but “today” a nice 2-bedroom on campus (built and managed by one of the Nishi developers) is $1,825/month. That is a lot of money (it is more than my monthly mortgage payment), so I don’t see why people keep talking about the “2,400 month 2-bedroom” when $2,400/month is more than any 2-bedroom rent in town (and is the monthly payment on a typical $550K 30-year loan)
> Times have changed
True, that is why I asked “can anyone name a a single apartment built in 30 years that has 1,100 sf 2-bedroom units?” In the 50’s and 60’s (when land, labor & material was cheap) developers like (Chargers Owner) Spanos built a lot of 1,200sf + 2-bedroom units in the central valley, but I have not seen (or heard of) one in the past 30 years.
Are you saying that “times have changed” since Tandem built the Colleges at La Rue ~15 years ago and Carmel Partners built the West Village ~5 years ago?
http://colleges.tandemproperties.com/floorplans.aspx
” That is a lot of money (it is more than my monthly mortgage payment), so I don’t see why people keep talking about the “2,400 month 2-bedroom” when $2,400/month is more than any 2-bedroom rent in town (and is the monthly payment on a typical $550K 30-year loan)”
Because it’s new
Alan:
Thanks for the data, do you know that using the “average” rent per sf is a bad way to find the rent of a 2-bedroom apartment (unless you are trying to make the rent seem higher)?
At the Colleges of La Rue the rent per SF is $2.17/sf for the 1br units but only $1.76/sf for the 2-br units.
P.S. using both “average” rents and “median” size units make things look even worse.
Exactly. In the present Davis/Woodland rental market they aren’t going to be asking or getting $2.20/sq. ft. for the 2 bedroom apartments. This is a misuse of statistics.
Necessity is the mother of invention. Those that find it necessary to block every development will always find something they can use to justify their opposition.
True – But the fact is that the Council did NOT change the ordinance for Nishi. Rather, they just simply ignored it
The question is whether they have the ability with three votes to do that. I don’t think you’re going to find a court that will say they can’t.
They also have an escape clause – they can change the law retroactively making the point moot.
It seems that they implicitly changed the affordable housing requirement simply by approving the development agreement. Do they have to do it explicitly?
To me that’s the key question but if they do, they can do it retroactively.
If an ordinance it was passed with votes of a prior city council. So why couldn’t the current city council change the ordinance? I would need to review the exact language of the ordinance, but my expectation is that there would be exception clauses… or room for discretion. Otherwise we would find ourselves in a situation where our elected leaders would be stuck in perfection being the enemy of the good position.
It only takes three votes to change the ordinance
That was my point. So why all the conspiracy theory tone from others that the CC did a bad thing… broke the law or something?
Frankly: Because people are trying to justify voting against the project.
Frankly: If you read the full staff report, you will see that there is no amendment to the affordable housing ordinance. So while the Council has the power to amend the ordinance, they didn’t exercise their power.
So presumably they can do that retroactively if they feel that is necessary.
Yep
Nope
That’s the type of conduct that opens the door to the Mike Harrington’s of the world.
There’s nothing illegal about it.
The affordable housing ordinance is not designed to make housing affordable. It is a tax on new housing, adding tens of thousands of dollars to the cost per unit, with the specific purpose of increasing the cost of building new housing in town. The affordable housing ordinance is a publicly funded program designed to make housing more expensive and protect the property value for existing investors and homeowners. In addition, the City’s Staff have demonstrated over the past several years that they lack the capacity to run the program effectively, resulting in millions of dollars of losses for the City and residents. The Affordable Housing Ordinance and the City’s Affordable Housing Program should both be scrapped.
In its place, we should simply start building affordable apartments, townhouses and condominiums, lots of them, spread all over town. Solutions, not vacuous and expensive ‘feel good’ programs.
Mark wrote:
> It is a tax on new housing, adding tens of thousands of dollars
> to the cost per unit, with the specific purpose of increasing
> the cost of building new housing in town.
Increasing the cost of building in town is just the secondary cost of “affordable” housing the “specific purpose” is to get “affordable” units to give to friends and friends of donors and when the developers give cash rather than build the units to get money to friends and donors “paying them back” buy buying their land, and then hiring them to design, build and manage the “affordable” property (you can look at every “affordable” project in town and the people involved reads like a “who’s who” of the politically connected)…
I agree with this.
But it goes against the grain of all the government-class people in this town… those that tend to gravitate toward public policy solutions to all our perceived social and economic “fairness” problems.
We need to just accept that we will never be able to make housing truly fair, just as we won’t make college admission acceptance academic achievement “fair”. Some will always have it better than others.
After we accept this truth, then we can focus on “reasonable”. What is reasonable for providing a supply of housing to meet our city demands?
I say it is reasonable to grow our housing supply by 1-2% per year after front-loading some more aggressive growth to make up for the last 15 years where we have grown our housing less than 1% per year.
And then the price of Davis housing is the price of Davis housing.
Just like the academic admission standards for UCD are the academic admission standards.
If we would just be reasonable, we should be able to sleep well at night knowing we did enough.
I don’t have a problem with trying to provide some housing at lower cost to some members of our community, particularly those who are disadvantaged somehow, and in fact I think there is some legal obligation to try to do so. But the goal should be to provide it fairly and efficiently, and as far as I can tell the city has never achieved either of those things. The current system essentially makes some housing more expensive in order to provide other housing at lower cost to other people.
The current affordable housing policies should be scrapped. We have an emergency situation with the shortage of rental housing. That needs to be the focus, not carving out special lower-priced housing for certain people. Maybe when the apartment vacancy rate gets back to some historical average, prior (current) affordable housing policies could resume. As has been noted repeatedly, housing vouchers would be much more efficient than what’s being done now.
“We need to just accept that we will never be able to make housing truly fair, just as we won’t make college admission acceptance academic achievement “fair”. Some will always have it better than others.”
This is only true because we design our society that way. There is no dictate from “God” however one perceives that concept, that says that a society cannot be more egalitarian. We choose it so. We could choose otherwise. Other societies have opted for greater equality. We have opted for vast disparity, and are clinging to it, with some clinging much more fervently than others. This is the real change that I would like to see. But I do realize that creating a much more egalitarian society would necessitate much more change than just pushing for “more, or even much more, of the same”.
Greenwald completely misses the entire point of the affordable housing controversy.
The City now acknowledges that the Nishi project was exempted from it’s affordable housing obligation because of the large infrastructure burden of the UPRR undercrossing.
This means the UPRR undercrossing will be paid for on the back of the City’s affordable housing program – not by the developer … even though developer-financed infrastructure was one of the main talking points for the proponents of the project (including members of the City Council commenting from the dais).
If the City Council wants to subsidize this Whitcombe apartment cluster with affordable housing dollars, they probably have the power to do so. Whether or not the AHO exemption was legally granted probably needs to be adjudicated.
Amazing how they spend money they do not have, even in an election year. And the rest of the City suffers. They can’t even build a playground without making it a toxic dump after 20 years.
“The City now acknowledges that the Nishi project was exempted from it’s affordable housing obligation because of the large infrastructure burden of the UPRR undercrossing.”
Where did the “city” say this?
Mike Webb – public hearing
In other words, Dorms. Good luck with that car thing, or finding parking for the Commercial people doing business there.
Well this is pretty much the end of the Conversation on “Affordable” units. The Press release will be all sunny and happy and people will be in polluted areas, and be close to campus.
And yet, the City will find a way to still be in the Hole when is washes out.I bet the Developer is not working for a negative result.
“The current affordable housing ordinance exempts vertical-mixed use rental housing and stacked-flat condominiums from inclusionary requirements. This was reflected in preliminary draft deal points presented with the predevelopment agreement in 2012.” David Greenwald
The rental housing at Nishi is not vertical mixed use. The requirements for vertical mixed use are clearly spell out in the zoning ordinance, and Nishi does not come close to meeting the requirements.
Isn’t Greenwald simply quoting from the city staff report from November 2015?
Moot point – the 440 unit Whitcombe apartment cluster is not vertical mixed use
Isn’t it 5 or 6 stories with retail on the ground floor?
Read the preliminary planned development zoning ordinance – it’s in the staff report. There’s not enough retail in the project to get anywhere close to putting in the required amount of first floor retail to qualify as vertical mixed use.
You can chalk that one up to the protectionists trying to prevent competition with the incumbent retailers downtown.
The Pulgilist wrote:
> Isn’t it 5 or 6 stories with retail on the ground floor?
Then CalAg wrote:
> Read the preliminary planned development zoning ordinance
I have read it and unlike CalAg I (and others) believe that there will be enough retail to call it mixed use.
In which case, they meet the letter of the law, and the council has the right and ability to override the affordable housing code by a simple majority anyway.
Lay it out CalAg – how does the retail fall short? What is the requirement for vertical mixed use?
Note that the code requires that the ground floor uses be “unrelated non-residential uses” and expressly prohibits uses that are “ancillary to residential units.”
The project has four rental buildings – each with footprint of approx 30,000 sq ft. That translates into a need for approx 120,000 sq ft of non-ancillary usesl to meet the requirements for vertical mixed use.
The entire project (R&D plus residential) is zoned to allow only 20,000 square feet of accessory and conditional uses (which would include retail).
Bottom line – There’s not enough non-R&D commercial allowed in the entire 46 acre project to get anywhere close to putting in the required amount of first floor commercial to qualify the for-rent residential as vertical mixed use.
You obviously didn’t understand what you were reading.
CalAg wrote:
> expressly prohibits uses that are “ancillary to residential units”
It does not “prohibit” uses that are “ancillary to residential units, it just says that it won’t be considered “mixed-use” without some “unrelated” non-residential uses on the ground floor and if you “only” have uses ancillary to residential units it won’t count at mixed-use. Think about it unless the residents enter and leave via a helipad (or rope ladder) EVERY mixed-use building has uses “ancillary to residential units” on the ground floor (they don’t make the mailman walk up stairs to deliver the mail).
Like I said.
The City staff is not even using this “explanation” any more – I’m surprise to see it recycled in the Vanguard.
Why not? You use out dated comments that favor your position as if they had been set in stone…
Wasn’t that from November?
Dear Friends and Frenemies: We should have the Nishi full record sooner rather than later, including all the videos of the CC and Commission hearings, most of it transcribed.
You should see first hand in the emails how the AHO was gutted here, and the reasons why. (Donating the RR tunnel costs out of the AHO trust fund, for example.)
I am going to look at the issue of the City giving away public assets to boost the profits of a private company.
In the civil case, we get full discovery, and depositions, so that “behind the scenes” information should be coming out in the months ahead. I
We are welcoming contributions towards the litigation expenses, especially the costs of the admin record. Michael@mikeharringtonlaw.com
Thanks for your support and good cheers, Michael
Mike wrote:
> We are welcoming contributions towards the litigation expenses
After reading this I went to a UC Davis site to see if it says how many more years they plan to let Orchard Park sit vacant and fenced off. I had to laugh when I read that one idea UCD has is:
“Solicit donations to help subsidize construction costs and/or rents”
https://gradstudies.ucdavis.edu/sites/default/files/upload/files/current-students/orchard-redev-status-report-3-2-16.pdf
The “public assets” don’t accrue without development… unless of course, the poster believes all undeveloped/underdeveloped land “belongs to the people” (an asset of ‘the people’). Sounds about 16 klicks to the left of Bernie Sanders… one klick to the left of Lenin. If it is the “peoples’ asset”, that asset belongs, at this point, to Yolo County… am coming to the conclusion that we should not take that asset from the County, and let the County and UCD do the deal… as long as there is no motor vehicle connection to W Olive…
Remember, the Nishi site wasn’t even in Yolo County a few years ago…
I think some local developers who hate to see that THEY are paying the full ride, and watching Ruff and Whitcomb mop up free money after years of CC contributions and schmoozing around City Hall, are probably pretty pissed off … but dare they say anything at City Hall? Not a bats chance in heck; they are not suicidal.
But they sure as heck can contribute to our litigation, and that is private funding.
Here you go, Mike: https://davisvanguard.org/advertise/
You’ll find the Vanguard advertising rates there.
I understand that the CC also gifted millions of exemptions from AHO requirements to Cannery?
I think there is at least probable cause to look into how the CC contributed + $10,000,000 given away to Nishi, taken out of the pockets of housing for the poor and middle class. I know it’s not cash … but it’s pretty close to that.
When this iteration of a Nishi proposal first came along, I was pretty excited. The city agreed to invest some up-front money in the EIR and application in exchange for fee title to some/all of the commercial development. It was on the innovation center site list, and looked like a great spot for UCD spinoff companies to get started and generate tax dollars. Rob White was telling us how strong the demand for these spaces was.
Somewhere along the way the city’s ownership piece fell off the table, but hey, we’re still going to get a bunch of tax revenue from the innovation space, and all those apartment beds will be filled by students, thereby taking some of the heat off the mini-dorm market that’s plaguing single-family neighborhoods all over town.
Later the economic analysis makes the projected tax revenues look kind of dodgy, so the Council patches that up by building some modest guarantees into the DA so that the project doesn’t go net negative on us.
Then a local commercial real estate broker tells me that he’s dubious about the demand for innovation space in Davis, that the cost isn’t going to be able to compete with West Sac, and he’s wondering if the Nishi commercial buildings will actually get built.
Next we learn that those apartments are going to be on the pricey side, and that only well-heeled students will be able to afford them. The hoi polloi will still be pushing hard on the single-family mini-dorm conversion market.
And now we find out that $11M was sort of left on the table due to the affordable housing thing.
Is it any wonder I’m having a hard time mustering enthusiasm for Nishi now? I haven’t decided how I’m going to vote yet, but most of what I was hoping from from the project seems to have evaporated.
Jim wrote:
> Next we learn that those apartments are going to be on the pricey side,
> and that only well-heeled students will be able to afford them.
> The hoi polloi will still be pushing hard on the single-family mini-dorm
> conversion market.
Like all NEW (non-subsidized) apartments the rent will be high, but don’t forget when we get more new units (as long as we get more new bed spaces in the units than we get new students) the rich kids will move to the NEW units opening up a unit for middle class kid to move in to a newer unit that opens up an older unit so a poor kid can get his own room in an apartment and move out of the converted garage he has been sharing with two other guys in a “mini-dorm”.
The apartment market is like the car market, fancy new cars cost a lot, but as they age they cost less. It costs twice as much a month to buy a new Toyota as to buy a used certified pre-owned Toyota just like a fancy two bedroom unit in the West Village costs about twice as much per month as a small older two-bedroom in Central Davis.
Sorry but the “apartment” market is nothing like the car market…unlike cars, homes don’t “lose value” accept for in econ crises or unless they’re so substandard a slumlord will take what they can get below mrkt value and neithet of these instances occur that often here in Davis. Rents may stagnate but won’t drop… they’re already unaffordable here and when newer apts are built the mrkt rents increase which will allow the older ones to also increase.
ruralknight wrote:
> unlike cars, homes don’t “lose value”
You are forgetting that most people buy a home (that drops in value) with land (that over time does not drop in value).
If you don’t believe me look at the value of “mobile homes” (that rent the land under them) or the value of a new home compared to an older home on the same street (or even the value of two identical Davis homes, one with no updates in 40 years vs. a home that has just been featured in a mid-century modern magazine)
> when newer apts are built the mrkt rents increase which will allow
> the older ones to also increase.
Except for some rare examples (like the recent tech boom in SF, the now busting oil boom in the Dakotas and early days of UC Merced when it was growing faster than they were building) new apartments in town cause rents to drop.
P.S. Renting an apartment is like renting a car and use of a road. The nice car and the smooth road is more expensive than the old car and the poorly maintained back road…