"Affordable housing crisis threatens vitality of Colorado’s high-country economies"

The Colorado Sun — jason@coloradosun.com

First-ever Mountain Housing Summit looks for ways to move developers toward “missing middle” projects, and that may mean focusing on wealth creation rather than wealth extraction.

VAIL — Willa Williford, an affordable housing consultant who has worked across Colorado’s high country, this week tallied some classified ads in the Crested Butte News. In Wednesday’s edition of her hometown paper there were 85 listings for jobs, from entry-level gigs to high-paying executive jobs. There were 11 listings for rental properties, most of them seeking roommates. And the back of the paper was heavy with color ads for homes in a region where the average price exceeds $1 million. “Housing is one of the key components to our long-term sustainability as communities,” Williford said. “So why are we not building more affordable housing?”

Affordability is at crisis level in Colorado’s mountain communities, where income gains are not nearly matching the soaring cost of housing. Construction and labor costs are skyrocketing, with developers understandably focused on high-return luxury projects. Investors are parking money in resort-area real estate — usually paying cash and easily pushing out locals who have to borrow to buy. 

This week in Vail, the cacophonous chorus echoing across the West’s increasingly pricey high country joined together at the first U.S. Mountain Communities Summit. Dozens of planners, developers and civic leaders led the summit’s choir, stirring conversations and uncovering possible solutions to a housing crisis that threatens the character and sustainability of mountain communities. “This work is hard. It’s multifaceted. There’s no perfect answer and solutions will always elude us, but it’s so worthwhile,” Williford said on Thursday, the final day of the four-day summit.

The summit was sponsored by APX1 Partners, a group that provides community-building resources for mountain development and investment. Natalie Spencer founded APX1 less than a year ago with hopes of creating a “knowledge bank” where mountain communities developers and leaders could find policy solutions, such as agreements for residents in deed-restricted housing or development plans for projects that can house a wide array of residents and income levels. 

“So we can leverage off of each other’s wins and potentially circumnavigate the losses. So if something isn’t working consistently in Telluride or Jackson, we will be able to know that right away,” Spencer said. “That’s how we can get communities out of the cyclical conversation of ‘This is our problem,’ and into the very proactive, solution-based dialogue.”

These mountain-community confabs tend to dissolve into group commiseration. The lamentations shared across resort landscapes often are similar. Construction workers have fled for jobs in disaster-ravaged communities like Houston. Prices for land and homes continue to climb. Old building codes prevent density. The lack of affordable housing is starving an already emaciated workforce. Workers in far-flung communities are spending hours commuting. 

But this rally included a celebration of affordable housing successes, where walkable communities of diverse residents are thriving. They are places where low-income families mingle with second-homeowners and middle-class locals. In the parlance of mountain housing, these are hoods that combine residents earning somewhere between 30 percent and 300 percent of the average median income. 

Places such as:

  • Chamonix Vail, a 32-home affordable neighborhood in West Vail, which involved the  Town of Vail financing more than $17 million for construction.

  • Miller Ranch in Edwards, which offers 282 deed-restricted homes.

  • Anthracite Place and the under-construction Paradise Park, in Crested Butte.

These neighborhoods offer the so-called “missing middle” housing. They aren’t always apartments for seasonal workers and they aren’t million-dollar homes that demand impossible monthly mortgage payments. They are middle-class friendly, populated with the architects, doctors and business owners who keep communities vibrant. 

“As mountain communities evolve this segment of our population is very important,” said Melissa Sherburne, the head of acquisitions for the innovative Brynn Grey Partners, which has developed innovative communities in Summit County, including Wellington, Peak One and 24 new “micro-condos” at the mixed-use Basecamp project. Sherburne lives in Peak One. “We are raising families … we are dedicated to our communities and we give back in so many ways.”

Part of the summit’s sessions fell under the banner of the “YIMBY Jamboree,” with speakers focusing on how to dispel the notion that affordable housing development brings negative impacts. The YIMBY Jamboree — the tongue-in-cheek offshoot of Eagle County’s year-round housing taskforce — is pushing to overcome the overwhelming “Not In My Backyard” chants that engulf just about all density development projects in the mountains. 

“How do we make the development process easier and more attractive?,” said Dr. Bobby Lipnick, a long-term Vail resident who helped found the jamboree. “There are a lot of people in our community who say no more growth. They say they got here in the 60s or 70s and it’s time to just stop. We need to stand up and meet with YIMBYs in the room to offset the NIMBYs who are often loud and incredibly vocal.”

But Lipnick pointed to 5.7 million residents in Colorado, 3.3 million of them living on the Front Range. “Those people are going to come up here in the next 25 to 30 years,” he said. “We need to think about smart growth and responsible growth and not bury our heads in the sand.”

Communities of local residents in resort valleys are critical to high-country economies. And they are endangered. Without homes for employees, businesses falter. But in these land-constrained corridors, property and construction costs are high and developers understandably are drawn to erecting single-family castles that sell for millions. But then those homes sit unused for most of the year, owned by investors who reap appreciation that often beats traditional investments. 

“If I had a magic wand I would wave it at the 1 percent who own the homes in our beautiful  state, the homes that are dark … 348 days of the year. If I had a magic wand, a social-justice wand, I would wave it and say you are buying into a community and let’s focus on a wealth-creation model instead of wealth extraction,” said Chantal Unfug, the director of Colorado’s Division of Local Governments during a panel discussion on Thursday. 

Unfug pointed to the state’s Rural Economic Development Initiative, the Office of Economic Development and International Trade’s Rural Jump-Start program and the new federal Opportunity Zone designations as ways to entice developers to projects with incentives and tax breaks. And not just large-scale developers, said Clark Anderson, the head of Glenwood Springs’ non-profit Community Builders, which works with rural and resort communities in fostering smart growth. 

Anderson said the mountains need to grow “developer capacity.” “Looking at the scale of problems in these communities, we have to empower an army of smaller mom-and-pop developers that can expand housing choices and affordability,” Anderson said. They won’t build a mid-rise apartment complex, but they can build a four-unit complex on a single-family lot.

“We need to build that capacity in the development community,” said Anderson, who uses the same “civic capacity” idea to encourage progressive candidates in joining local planning commissions and town boards to spur innovative growth. And the YIMBYs need to show up at planning and town hall meetings, said a trio of big-project developers. 

“The NIMBYs show up at every single project. It doesn’t matter if the basis of their opposition is factual,” said developer Gerry Flynn, whose construction costs have climbed four times in the last year as builds 282 apartments on a site in Gypsum abandoned by a previous developer after $18 million was spent. “Part of the goal of the community should be to show up in significant numbers to at least outnumber the NIMBYs and probably be more credible.”

If mountain communities want to address their critical supply-and-demand housing problem, it will require more than market forces, especially to develop homes that locals can afford, developers and municipal leaders say. Steve Spessard is building 120 apartment units in Edwards. His 6 West project, adjacent to a massive mobile home community, spent $2 million on impact fees and the Eagle County planning process. Impact fees and entitlements on a larger, more complex project his company is developing in Houston cost about $400,000.  

“That translates into real differences in rent amounts,” said Spessard, who has a list of 150 people ready to move-in when 6 West opens later this year. “If you are a government entity or you are a utility provider, figure out ways to say ‘yes’ sometimes Or maybe even ‘if’ instead of ‘no.’ ”

https://coloradosun.com/2019/01/18/affordable-housing-crisis-colorado-high-country/

Natalie Spencer