Partners (Summer 1997)
Partners (Summer 1997)
by Marie Easley
The view from Centennial Place is a breathtaking juxtaposition of rolling hills and skyscrapers. The first of five phases completed — and the second well underway — Centennial Place enjoys a dignified presence along Techwood Drive in Atlanta.
Centennial Place is a mixed-income apartment complex that replaces Techwood Homes, America's oldest public housing development. The new development is the only one of its kind in the country, according to the Property Manager, Ross Lloyd, with each complex combining a mix of public housing-eligible residents (40%), residents who would be eligible for low income housing tax credit subsidized housing (20%), and renters that pay market rates (40%).
The apartments, which are located adjacent to the campus of the Georgia Institute of Technology (Georgia Tech), feature 1 to 4-bedroom garden apartments and 2 to 4-bedroom townhouses. All units are equipped with new appliances, including a washer and dryer, track lighting, intrusion alarms and carpet. The complex has a pool, fitness center, and Tot Lot. It is located on two MARTA bus lines, and within five blocks of the North Avenue MARTA rapid rail station. Off-duty city police officers provide security for the complex from 8 p.m. until 6 a.m.
Beyond HousingThe complex has received a "Campus of Learners" designation. Apartments are wired for computer communications and residents have access to on-site job training and computer-based learning. A new math and science magnet elementary school will be constructed and will be linked on-line with Georgia Tech. Financing for the $9 million school will come from the Atlanta Public School System.
The existing library, built in 1909, will be restored and enhanced by an addition for a media center. A community center will be housed in another rehabilitated structure, circa 1941.
The Cupola Building, where President Roosevelt stood to dedicate Techwood Homes in 1936, will be converted to corporate suites. According to Egbert Perry, President of the Integral Group, the suites will be occupied as additional space by some of the development's corporate neighbors.
A New ApproachTwo hundred twelve families that once occupied Techwood Homes have been given the choice of residing at Centennial Place, or using Section 8 vouchers to subsidize alternative housing in the private market. Potential Centennial Place residents are carefully screened and have to be either employed or in job training through AHA's Workforce Enterprise, or some other job training program. In addition, every six months, the complex management will train a resident in an area of his or her choice — leasing or property management, for example.
Market rents range from $679/mo. for a 1 bedroom, 1 bath garden style apartment, to $1,259/mo. for a 3 bedroom, 2.5 bath townhouse. For the same townhouse with a garage, the monthly rent is $1,359. Tenants with incomes less than 60 percent of the Atlanta MSA median income are eligible for below-market rate rents, subsidized by low income housing tax credits. A tenant's subsidy is strictly confidential, and market and subsidized units are rotated to make them indistinguishable, thereby removing the stigma of a subsidy. See the chart on page 5 for income-restricted requirements and comparison to market.
Mixed Income HousingIdeally, residents of mixed income housing can avail themselves of many advantages. Better schools, professional role models, lower crime, retail services, and more competitive pricing from area businesses are some of the goals. Ross Lloyd observes that, "Already, former Techwood Homes residents are taking pride in their surroundings, and getting involved in the neighborhood. Having a place they look forward to coming home to generates enthusiasm, as opposed to the reaction to dilapidated surroundings which encourages an attitude of 'Why should I care?' Now, they have the opportunity to talk to people who have experienced different lifestyles, and observe new approaches." Renee Glover, Executive Director of the Atlanta Housing Authority, goes on to say, "How you mold and shape a young person is all about the kind of environment you raise them in."
The idea is that the social and economic opportunities provided low-to-moderate income residents will ultimately lead to subsidized residents becoming market rate tenants, or homeowners. Recertification of subsidized benefits is undertaken annually, and once a resident who was initially eligible for income-restricted housing reaches 140% of the maximum allowable income, he or she must either move or pay market rate. Likewise, unemployment and violation of conduct codes will result in residents being evicted.
Management StructureThe project is a joint venture among the Atlanta Housing Authority, the Integral Group, and SunAmerica Insurance Company that Ms. Glover hopes will reduce the amount of taxpayer money used to fund public housing. Centennial Place was developed by the Integral Partnership of Atlanta, a joint venture between McCormack Baron and Associates, Inc. and the Integral Group, L.L.C. It is managed by The Village Management Company of Atlanta, a partnership between McCormack Baron Management Services, Inc. and Integral Management Services, Inc.
Financial StructureThe primary subsidy comes from HUD's $1.4 billion HOPE VI program, which grants up to $50 million to remake an entire development, including complementary services. AHA's share of the total development was financed by a $42.6 million grant from HUD. The cost of the entire project including non-residential structures and programs is projected to be approximately $110 million. Housing will absorb approximately $75 million of that total, to be completed in five phases. AHA has granted a 55-year ground lease on the land.
The first phase of the project consisted of 181 units, including 73 public housing residences, 36 units for low-income housing tenants, and 72 market rate apartments. Both public and private funding sources were combined to structure the deal.
American Capital Resources, a private investment company, supplied the first mortgage - insured by FHA - in the amount of $3,972,600.
AHA, using HOPE VI funds, financed a second mortgage in the amount of $3,520,000. AHA also used the HOPE VI funds to provide a grant of $2,409,300.
SunAmerica Insurance Company provided equity of $3,971,900 through the purchase of low income housing tax credits.
An additional $159,379 was garnered from revenues earned from parking during the Olympics, bringing the total financing of Phase I housing to $14,033,229. According to Carol Naughton of AHA, financing of the four other phases will be similarly structured.
Funding for exterior renovations of auxiliary buildings will be provided by a $3 million grant from the HUD HOPE VI program. A partnership between the Integral Group and AHA, using proceeds from the sale of historic tax credits, will finance the additional $3 million it will take to renovate the interior. Revenues from a coffee shop on the premises, along with the income stream from the corporate leases, are expected to repay the partnership and enable the enterprise to be self-sustaining.
A state-of-the-art YMCA, independently financed with $4 million in grants from private foundations, will be built on the land. In addition, retailers, including a national grocery store chain, and other service providers are expected to occupy two blocks along Techwood Drive at Alexander.
Will It Work?The ultimate question will be whether the mixed income housing will hold the necessary appeal to fill all 900 new units. "You've got location, location, location here," says the Integral Group's Egbert L.J. Perry. Not only does the location offer panoramic skyline views, but the development's close proximity to such prominent corporations as Coca-Cola, NationsBank, Georgia Tech, and CNN is a compelling reason to live there. Perry says waiting lists already exist among the three groups of tenants who will share the Village.
A great many hopes are pinned to the success of Centennial Place and other mixed-income developments of its kind. No one expects an overnight cure, but with its diversity, prime location, educational facilities, transportation, and neighborhood support, Atlanta's Centennial Place shows a lot of promise.
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