New Harvard Report Charts Presence of High Rents, Even as Pace of Apartment Construction Picks Up1/25/2024 While rents in some sections of the country appear to have topped out, costs overall remain generally burdensome with upwards of 22.4 million tenants now spending more than 20% of their incomes on basic housing and utilities. So says a comprehensive new report just released by the Joint Center for Housing Studies of Harvard University, which also notes that a record 12.1 million people are shelling out more than half of their incomes on rent. The report, America’s Rental Housing 2024, acknowledges that for all of the forbidding numbers, rents in general appeared to reach a peak last year, with rent growth for “professionally managed apartments” at the 0.4% level. That’s a significant decrease from where things stood in early 2022 when the number came in at 15.3%. Perhaps contributing to the decline has been the growing number of new apartment construction. As of the final quarter of last year, some 436,000 new units had been completed. “This abrupt deceleration was geographically widespread,” notes Whitney Airgood-Obrycki, a senior researcher at the Harvard program and lead author of the new report. In a press release, Airgood-Obrycki added: “While the slowdown is a welcome change for renters, asking rents still remain well above pre-pandemic levels.” Even though the increase in new apartment construction is being seen in all regions of the country, the report notes that the nation’s rental stock is “older than it has ever been,” up from 34 years on average two decades ago, to around 44 years as of the end of 2021. “And many of those units fall short of baseline habitability and safety,” says the report. “Nearly 4 million renter households live in physically inadequate units.” Many of the units additionally are in need of energy efficiency and electrical system upgrades. Not helping matters is the ongoing decline in the number of low-rent units nationally. Rentals of $600 a month or less have declined by 2.1 million in recent years. Says the report: “Since 2012, the market also lost an astounding 4.0 million units with rents between $600 and $999.” In total, the market has seen a drop of some 6.1 million units under $1,000, with the Harvard report noting that “various market forces have contributed to those losses, including rental increases among existing units, building condemnations and demolitions, and tenure conversions.” While the problem of rent affordability won’t go away overnight, the report ends on a somewhat encouraging note, remarking that “state and local governments are seeking to reduce barriers to building housing that is more affordable and located in desirable neighborhoods.” These moves are leading to the reforming of zoning laws "to allow for a greater variety of housing types.” At the same time, suggests the report, the building industry “must continue to innovate less costly ways to build homes. If successful and achieved at the needed scale, these efforts could address the affordability challenges facing middle-income renters.” By Garry Boulard
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Planning is still underway on a project set for the south side of Fort Collins that will see the building of 116 new apartments. The Collins apartment complex will be built on the southeast corner of Harmony Road and College Avenue and was originally approved in the fall of 2016 by the city’s Planning and Zoning Board. But due to a variety of factors, including construction costs and delays prompted by Covid 19, work on the project has yet to begin. The project by Massimino Development, which was formerly called Brick Stone Apartments on Harmony, will feature master suites with such amenities as walk-in closets, nine-foot-high ceilings, and in-unit bike storage. Architect for the The Collins is Ripley Design of Fort Collins. The larger project parameters will include 5,300 square feet of common interior space, as well as four terraces and a roof top swimming pool. Earlier reports indicated that the project would consist of seven 3-story buildings. While the original city approval for The Collins is now more than seven years old, the planning and zoning board this month agreed to give the project more time for development. It is thought that work on the The Collins will launch later this year. Massimino Development, which is based in Boulder, advertises itself as a “fully integrated real estate development firm” investing in projects primarily located in the West. Among its other endeavors, the company, working with the Chicago-based Origin Investments, spurred construction of the nearly $69 million Farm Haus Apartments in Longmont, a 280-unit development. By Garry Boulard Public input in Phoenix will soon be solicited on a project that will see the replacement of one of the city's busiest fire stations. Located on the north end of the city at 403 E. Hatcher Road, Fire Station Number 7 is a one-story, two-stall facility that Phoenix Fire Department officials is too small for current needs. According to city documents, plans are calling for the building of a new 18,000-square-foot facility, with four bays designed to support both fire and emergency response equipment Funding for the project, which does not yet have an official schedule, will be coming through a $500 million general obligation bond approved by city voters in November. Of that $500 figure, $214 million is designed to directly target fire and police department facility projects. According to a list prepared last year by the city's General Obligation Bond Committee, work on the Fire Station 7 project is expected to cost $21.4 million. The Fire Station 7 project comes as the city is contemplating the building of three other stations, with price tags ranging between $21.4 million and $24.5 million. Work, meanwhile, was launched three months ago on the $6.2 million building of the new 21,000-square-foot Fire Station 62 at 9300 E. Lower Buckeye Road, which is expected to be completed by the end of this year. By Garry Boulard A Supreme Court decision that for the last 40 years has been criticized by many in the business community for giving federal agencies too much regulatory power is being re-visited by the higher court. In the summer of 1984, the Court issued a unanimous decision granting the doctrine of judicial deference when it came a federal agency’s interpretation of an ambiguous statute. What has come to be popularly known as the Chevron Deference came about as the result of Chevron U.S.A. v. Natural Resources Defense Council. The NRDF took the Environmental Protection Agency to court during a time when that agency was being criticized for being too lax in its interpretation of the Clean Air Act, especially when it came to companies like Chevron. In its deference ruling, the Court ruled in favor of giving agencies a certain amount of latitude when it came to enforcement activity, thus substantially empowering them in areas where the wording of a statute is not entirely clear. The agency’s judgment in such cases, said the higher court, should be deferred to, thus creating what has since been known as the Chevron Deference. A variety of industry groups have since attacked the ruling, with the National Association of Home Builders in a recent statement declaring that the Chevron Deference is “biased toward federal agencies by granting them broad leeway to interpret and implement regulations.” It is not known when the Supreme Court will make a decision on the Chevron Deference, but already court observers are making predictions: law reporter Amy Howe last week wrote in her website Howe on the Court that it seems unlikely that the Chevron Deference “will survive in its current form.” Howe added that a majority of the justices seem “ready to jettison the doctrine, or at the very least significantly limit it.” Reporting on the oral arguments in the case, the New York Times agreed, remarking that the "foundational doctrine of administrative law called the Chevron Deference appeared to be in peril.” By Garry Boulard A nearly 5,000-square-foot building in the Denver suburb of Lakewood that once housed a bank is set to go to auction beginning on February 5. The one-story structure is located at 9210 W Colfax Avenue and for roughly a decade was a branch office for Chase Bank, before closing some 3 years ago. Built in 2011 on the site of a former car dealership, the building features a spacious lobby, office space, and three detached car drive-through lanes. Designated as a Class B structure, the building sits on a less than one-acre site. In a restructuring move, Chase last year closed nearly 160 branch locations across the country, with six of those branches located in Colorado. Although the publication American Banker recently suggested that Chase was “running out of branches that it wants to close,” the banking giant has said that more location closings are planned for this year. A starting bid of $150,000 is specified for the two-day auction to be conducted by Cushman & Wakefield, which serves as the bank’s official realtor. The realtor currently has nearly one hundred listings of former Chase bank properties across the country, including half a dozen in Colorado. By Garry Boulard A long-simmering plan to build a new multi-use public park on the southeast side of Chandler has taken a significant step forward. Members of the Chandler City Council have given their approval to the City entering into a contract with the company J2 Engineering & Environmental Design, which has offices in Phoenix, to come up with a plan for what is a 100-acre site. The company specializes in landscape architecture, civil engineering, and hydraulic and water resources engineering, among other areas The City Council vote comes three years after Chandler's Parks Strategic Master Plan listed turning the property at the intersection of Val Vista Drive and Riggs Road into a park as a top priority. That master plan envisioned a three-phase development and construction schedule for the new rectangular-shaped park at a cost of around $16 million. According to city documents, the early visions for the project included space for a dog park, amphitheater, skate park, restrooms, shade structures, and multi-use fields. Some 10 acres of the site saw the construction nearly two decades ago of the Mesquite Groves Aquatic Center, which in the years since, with its swimming pools, interactive water features and lazy river, has turned into one of Chandler's most popular recreation offerings. A public input process is expected to launch later this spring, asking residents for their views on the development of the new park. According to a release issued by the City of Chandler, the Mesquite Groves Park project will be "designed and constructed in three phases, which will be determined as part of the conceptual design phase." By Garry Boulard Legislation has now been passed in both houses of Congress, forestalling an imminent government shutdown. But lawmakers must still pass a slew of appropriations bills before February 2 designed to keep a handful of the federal government's largest agencies in operation. By a 77 to 18 vote, the Senate passed a short-term funding extension that will keep things in place until a new funding deadline of early March. The vote in the House: 314 members in favor of the funding extension and 108 voting in opposition. House Speaker Mike Johnson said the short-term spending legislation is what is required to "complete what House Republicans are working hard to achieve: an end to governance by omnibus, meaningful policy wins, and better stewardship of American tax dollars." But Congressional reporters noted that within the Republican caucus, a large 106 voted against the extension. Those in opposition include Representatives Andy Biggs, Elijah Crane, Paul Gosar, Debbie Lesko, and David Schweikert of Arizona; and Lauren Boebert and Ken Buck of Colorado. No members of the New Mexico delegation were opposed. Congress must come to an agreement on a separate series of appropriations bill by the end of next week that will fund, among other agencies, the Department of Commerce, Justice Department, Homeland Security, the Defense Department, and the Department of Interior. Sources have earlier confirmed that a government shutdown could have an impact on infrastructure projects already in the planning stage, particularly when it comes to obtaining various agency permits. According to the Washington-based Center for American Progress, funding additionally coming through the Department of Agriculture for water and wastewater infrastructure projects would come to a halt in a shutdown, as would funding for "electricity infrastructure and communications infrastructure." By Garry Boulard Work could begin later this summer on the building of a new 102,000-square-foot multi-level recreation center in Grand Junction. Members of the Grand Junction City Council have given their approval to a proposal calling for the issuance of $70 million in bonds to fund the project. As planned, what is officially being called the Community Recreation Center will go up within the borders of the city's 200-acre Matchett Park and will house a three-court gymnasium, a wellness pool, regulation lap pool, indoor walking track, and climbing wall. Additional features are set to include a hot tub, family game room, and multi-purpose event space. Initially rejected by Grand Junction voters nearly five years ago, an updated proposal for the project was approved in May of last year by a 60% to 40% margin. Public input on the project, which was originally proposed at 83,000 square feet, has been spurred by the firm of Barker Rinker Seacat Architecture of Denver which specializes in recreation center work. It is thought that the building project will have a roughly one-year schedule, with the center expected to be open in the fall of 2025. By Garry Boulard New Mexico Governor Tasks State Lawmakers with Energy, Infrastructure, and Housing Legislation1/19/2024 A greater abundance of advanced energy technologies, as well as increased state funding for infrastructure projects, are among the marquee items to be voted on by members of the New Mexico State Legislature in the next month. Governor Michelle Lujan Grisham in a State of the State address, outlining her priorities for the legislative session, is specifically calling for the dedication of up to 2% out of the state's Severance Tax Permanent Fund to back advanced energy technology projects. That funding, which would amount to $170 million, will "catapult forward the advanced energy sources of the future," said the Governor, specifically referring to "hydrogen, geothermal, and next-generation battery storage," and in so doing will further commit "our state to the climate goals of the country." The Severance Tax Permanent Fund, which was created by lawmakers in 1973, is designed to serve as a depository for severance taxes that are not being used to pay down bonds for capital outlay projects. The dollar worth of that fund as of early last year was in the neighborhood of $6.6 billion. Taking note of the current historic availability of funding coming out of Washington for any number of infrastructure projects, Lujan Grisham also wants to see lawmakers approve some $100 million to support an infrastructure matching fund in order that "communities don't have any federal money on the table for lack of a local match." The Governor also proposed an appropriation of $55 million to "continue expanding a widespread charging infrastructure network for electric vehicles." Lujan Grisham added that "charging an electric car or truck in New Mexico should be as easy and convenient as pumping gas." The Governor said she would also like to tackle the ongoing issue of a lack of affordable housing in New Mexico via the establishment of an Office for Housing that would serve as a one-stop shop for housing developers and contractors. In this way, the office would streamline a process that often requires the involvement of multiple agencies. On the complicated matter of local zoning codes that are oftentimes one of the most troublesome obstacles to home building, Lujan Grisham was direct: "I am asking the legislature to require local governments to institute zoning and permitting requirements that meet national best standards." "Nobody should be prevented from building vital housing," the Governor added. "And nobody should be shut out of a place to live because of outdated and overlapping regulations." Lawmakers have a brief four weeks in which to pass legislature before the end of the winter 2024 session on February 15. A greater abundance of advanced energy technologies, as well as increased state funding for infrastructure projects, are among the marquee items to be voted on by members of the New Mexico State Legislature in the next month. Governor Michelle Lujan Grisham in a State of the State address, outlining her priorities for the legislative session, is specifically calling for the dedication of up to 2% out of the state's Severance Tax Permanent Fund to back advanced energy technology projects. That funding, which would amount to $170 million, will "catapult forward the advanced energy sources of the future," said the Governor, specifically referring to "hydrogen, geothermal, and next-generation battery storage," and in so doing will further commit "our state to the climate goals of the country." The Severance Tax Permanent Fund, which was created by lawmakers in 1973, is designed to serve as a depository for severance taxes that are not being used to pay down bonds for capital outlay projects. The dollar worth of that fund as of early last year was in the neighborhood of $6.6 billion. Taking note of the current historic availability of funding coming out of Washington for any number of infrastructure projects, Lujan Grisham also wants to see lawmakers approve some $100 million to support an infrastructure matching fund in order that "communities don't have any federal money on the table for lack of a local match." The Governor also proposed an appropriation of $55 million to "continue expanding a widespread charging infrastructure network for electric vehicles." Lujan Grisham added that "charging an electric car or truck in New Mexico should be as easy and convenient as pumping gas." The Governor said she would also like to tackle the ongoing issue of a lack of affordable housing in New Mexico via the establishment of an Office for Housing that would serve as a one-stop shop for housing developers and contractors. In this way, the office would streamline a process that often requires the involvement of multiple agencies. On the complicated matter of local zoning codes that are oftentimes one of the most troublesome obstacles to home building, Lujan Grisham was direct: "I am asking the legislature to require local governments to institute zoning and permitting requirements that meet national best standards." "Nobody should be prevented from building vital housing," the Governor added. "And nobody should be shut out of a place to live because of outdated and overlapping regulations." Lawmakers have a brief four weeks in which to pass legislature before the end of the winter 2024 session on February 15. By Garry Boulard Up to 200,000 new affordable homes may be built in the next several years, depending upon the fate of tax credit legislation just introduced in the U.S. Senate. Oregon Democrat Ron Wyden and Missouri Republican Jason Smith have introduced what is being described as a $78 billion tax deal that will in part spur low-income housing. In a statement,. Wyden. who is also the chairman of the Senate Finance Committee, remarked: "Fifteen million kids from low-income families will be better off as a result of this plan." Wyden said the proposal will expand an existing federal low-income housing tax credit, and in so doing will put back in place a 12.5% cap on a credit device that had been in place to great effect from 2018 to 2021. What is officially called the Tax Relief for American Families and Workers Act of 2024 will also, if passed, increase the use of private activity bonds to finance affordable housing. A recent report issued by the Washington-based National Low Income Housing Coalition indicated that the U.S. has a shortage of some 7.3 million rental properties for would-be renters with low incomes. That report also said that on average only 33 affordable housing units exist for every 100 low-income rental households, with those numbers varying from 30 or less in Arizona and Colorado, to around 40 in New Mexico. The Wyden-Smith proposal will next have to be approved by the full U.S. Senate and House of Representatives. By Garry Boulard |
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