Cleveland City Council recently green-lighted three affordable housing developments in the neighborhoods for public funding. Even though these won’t be large-scale projects, they are viewed by council and supporters as holding great promise because the housing is intended for everyday Clevelanders.
These housing developments focus on building primarily single-family homes on vacant lots in North Collinwood, the North Broadway-Slavic Village area and Detroit-Shoreway. The infill units will often be built on lots where houses once stood.
Combined, only up to about 100 houses could be constructed. Still, supporters say, the project shows Cleveland’s redevelopment efforts are expanding beyond the luxury housing market to include options for more working-class and middle-income homebuyers. These are the residents who typically live in many of the city’s neighborhoods.
Have you ever seen someone become wealthier by just renting? Homeownership is the backbone of our city, of our country. We must invest, from the government side, into our neighborhoods.
Councilman Richard Starr, whose ward includes the North Broadway-Slavic Village area, which is slated for affordable housing
Councilman Richard Starr, whose ward includes North Broadway-Slavic Village, said that building housing is essential to improving Cleveland neighborhoods and the lives of residents.
“A lot of these neighborhoods have been without [housing] investment for 25 to 30 years,” he said. “This is creating homeownership opportunities. There will be an opportunity for residents to create wealth.
“Have you ever seen someone become wealthier by just renting?” Starr said. “Homeownership is the backbone of our city, of our country. We must invest, from the government side, into our neighborhoods.”
Funds will provide up to a $40,000 subsidy per single-family unit built
Earlier this month, Council moved the three development projects from the yellow list, or wait-list, for funding to the green list. Last year, Council approved $49 million to help construct 1,400 units of housing and $5 million to help Habitat for Humanity build 50 homes and buy a building. Of the total, $35 million is coming from American Rescue Plan Act (ARPA) dollars, the federal pandemic-era funding Cleveland received. Projects that have gotten the green light also include senior housing and other multi-family housing developments.
The amount the three recently green-lighted projects will receive will vary, Marie Zickefoose, a spokeswoman for Mayor Justin Bibb, wrote in an email to Signal Cleveland. She said $40,000 per single-family unit is likely. Project developers will be responsible for tapping into other public and private funding to raise enough money for the often multi-million-dollar development projects.
What is considered affordable housing in Cleveland neighborhoods?
What is considered affordable housing can vary by the community, region, etc. The three council members representing the neighborhoods slated for infill housing said the definition of affordable to them includes housing that is within the reach of many working families now living in these neighborhoods. In addition to Starr, Signal Cleveland interviewed Councilwoman Jenny Spencer, whose ward includes Detroit-Shoreway, and Councilman Michael Polensek, whose ward includes North Collinwood.
Polensek said a sales price of no more than about $200,000 for new construction is reasonable. He said most homebuyers will qualify for tax abatement and other incentives aimed at making the housing even more affordable.
“My folks cannot afford a $300,000 house,” Polensek said. “We need affordable housing in the city.”
This price would be considered a steal for new construction in neighborhoods such as Tremont, downtown and University Circle, where the city has often played a role in spurring the building of high-end for-sale and rental housing.
“The city has made a lot of developers wealthy over the years,” Polensek said. “It hasn’t done enough to stabilize our neighborhoods. We’ve got to have affordability and we’ve got to have an emphasis on neighborhood reimagining.”
Spencer said it was essential for council to allocate money to jumpstart the construction of affordable housing. She said building housing in the post-pandemic economy has become more expensive for these reasons: The construction industry has experienced supply-chain issues, which have made costly delays more common. Inflation has led to higher labor and material costs and interest rates.
“It’s like a quadruple whammy when you think of the construction industry and what happened to it during the pandemic,” she said. “When you add those four factors up altogether, it is harder to build affordable housing now more than ever.”
She said council’s funding will often be similar to gap financing. It frequently will be a comparatively modest amount of money, in relation to the total cost of a project, but it could determine whether a developer will commit to building affordable housing.
Seth Task, partner at Rebuild Cleveland, which is planning to construct housing in North Collinwood and Detroit-Shoreway, said the council funding is vital. Without it, developers would most likely lose money building affordable housing, he said. Task said Rebuild Cleveland is “targeting” constructing homes under $300,000.
A look at three affordable housing projects planned for Cleveland neighborhoods
The Rebuild Cleveland project is listed on council documents as Rebuild Cleveland West – Phase 1 and Rebuild Cleveland East. Combined, 64 units are planned. The bulk of the units are planned for North Collinwood.
Polensek said Rebuild Cleveland told him they were interested in building on about 50 lots in his ward, many of which would need his approval for the developer to use since they are coming from the Cuyahoga County Land Bank.
“My comment was, ‘I’m willing to obviously consider that, but you’ve got to put something up and see how that works and how that sells,’” Polensek said. “I’m not going to lock up 50 lots until I know this is a reality.”
Construction in North Collinwood would include Arcade Place, a six-unit townhome project planned for the corner of East 156th Street and Arcade Avenue, Task said. In Detroit-Shoreway, he said two houses are planned on Colgate Avenue to flank a house Rebuild Cleveland constructed last year without this council funding.
In addition to the Rebuild Cleveland housing, council green-lighted another project in Polensek’s ward. Cleveland Neighborhood Progress plans to build nine homes on East 174th Street and Nottingham Road.
In Starr’s ward, the Oasis Housing Development is planned for what is known as the St. Hyacinth neighborhood in the area of Francis Avenue and East 61st Street, he said. Thirty units are planned, according to council records. Starr said many in the area had been lobbying for affordable housing for years to meet demand and to play a role in revitalizing the neighborhood.
“They’re going to be very much excited that we are able to build something,” Starr said. “I’ve been committed to support it the whole way.”
Starr said the area is well-positioned for future growth because it is near I-77 and Opportunity Corridor. He said other development is planned for his ward, whose neighborhoods include Central, Midtown, Kinsman and downtown.
“I want to see more affordable housing, but I want to see some homes that are going to be market rate.,” he said. “We need mixed-income housing.”
For now, council’s focus is on building more affordable housing.
Spencer said it was good that council dedicated $35 million in ARPA funding as part of the $49 million total, but it probably was not enough. She said when council sent out requests for proposals focused on gap funding for affordable housing projects, the body received about $90 million in funding requests.
“I would have added way more from our funds,” Spencer said of the ARPA money allocated.
She pointed to an affordable senior housing development project at Kirby Manor in her ward, which is still on the yellow list.
“Kirby Manor is buried on the wait-list even though it is a very viable and worthy project,” she said. “Maybe it would have made it to green if, as we went through our ARPA negotiation, we would have done $40 million.”
Polensek said building more affordable housing in Cleveland is going to require a comprehensive strategy that must include support from banks and other financial institutions. He said the strategy should address streamlining permitting and other city processes required for housing development.
“It’s going to have to be all hands on deck,” Polensek said.
Explore city spending of federal stimulus money on affordable housing and other projects below using Signal Cleveland’s ARPA tracker.
