As the City of Raleigh and its partners move forward with implementing the Wake County Transit Plan, a major public policy objective is to ensure affordable housing opportunities in proximity to these transit investments. Often referred to as Equitable Development Around Transit (EDAT), the policy calls for numerous regulatory tools and direct actions by the City. Many components of the $80 million affordable housing bond focus on the intersection of transit and housing, including the acquisition of sites near planned transit investments for future affordable housing development.
New Bern Avenue is one of four corridors in the City where bus rapid transit (BRT) service will become a reality in the next few years. To be viable, transit systems such as BRT are dependent on the higher densities necessary to generate high volumes of ridership. In turn, the availability of transit creates market demands for proximity that drive land values upward where land costs must be distributed over a greater number of units.
Because the New Bern Avenue corridor is largely fully developed, there are relatively few opportunities for significant affordable multi-family projects consisting of enough units (120+) for a 4% Low Income Housing Tax Credit/Bond deal to be viable. One of the few opportunity sites is a 9.46-acre low density rental development known as Duplex Village which is comprised of 66 duplex units built in 1949. Duplex Village provides affordable housing to mostly low-to-moderate income tenants. Because of the age of the units, it has been marketed as a significant redevelopment opportunity on the New Bern Avenue corridor and is currently owned by Austin-based Artesia Real Estate Investments.
Artesia and the City have discussed options for preserving long term affordable housing opportunities on the site, while at the same time allowing market forces to respond to the BRT proximity. To accomplish this, the City and Artesia negotiated a purchase and sale agreement wherein the City agreed to purchase the eastern portion of the site, consisting of 24 units in total, for future affordable housing opportunities. Through the negotiations surrounding the purchase and sale agreement, the parties agreed to the approximate division of the site as is generally depicted on the recombination plat that was reviewed by the City’s Planning Department.
The City and Artesia fully executed the purchase and sale agreement on November 4, 2020, and the City went on to complete its due diligence investigation of the eastern tract. The City has chosen to proceed with purchase and the closing was held on April 15.
Half of the units are vacant within the eastern tract of the property. The City’s priority is to first work with current tenants in good standing to transition them into other housing options, which may include affordable rental units owned by the City located elsewhere. Recognizing that tenants on both the eastern and western tracts may have been economically impacted by COVID-19, Artesia’s property management company also connected tenants to additional resources including rental and/or utility assistance offered through the House Wake! COVID-19 Financial Assistance Program and CARES Act funds, for which they may be available.
Second, staff will initiate a rezoning of the eastern tract from the existing R-10 to a higher density multi-family district. Third, through a Request for Proposals or another similar process, staff will solicit a developer for a 4% Low Income Housing Tax Credit/Bond project on the eastern tract. Using the tax credit mechanism, the desired objective is to create roughly twice the number of affordable units on the eastern tract that have historically existed on the eastern and western tracts combined.
For more information, please contact the Community Development Division by emailing email@example.com or by calling 919-996-4330.