New affordable apartments are coming to Meridian. Interested? Here’s what we know
After a 20-year dry spell, Meridian may soon gain new low-income apartments.
Developers and City Council members broke ground on Meridian’s newest low-income housing development Friday on West Ustick Road near the intersection of North Linder Road, ushering in a hope that the 46-unit complex could act as a bulwark against ballooning housing prices and stagnant salaries.
The Housing Co. is leading development of the complex at 1160 W. Ustick Road and is working in partnership with the city of Meridian, Red Stone Equity Partners, Banner Bank and the Idaho Housing and Finance Association.
The Housing Co., an independent nonprofit that shares board members with the Idaho Housing and Finance Association, is a development and property management company that builds, owns and operates affordable housing developments across the state.
According to Nate Wheeler, development manager at The Housing Co., Meridian’s median income has nearly doubled from $39,500 to $77,000 since Meridian’s last affordable housing development was built 20 years ago. But the median house price has almost quadrupled in that time.
“We need affordable housing,” Wheeler said.
The $15.6 million complex, known as the Wood Rose Apartments, would provide apartments for those making between 30% and 60% of the area median income – which is significantly lower than many other affordable housing developments in Ada County.
For a two-person household in 2023, 30% of the median income in Meridian is $21,390, while 60% is $42,780. Rents at these incomes would be limited to $601 and $1,203 per month respectively.
The Department of Housing and Urban Development determines these numbers annually and updates them every spring, so there may be an increase by the time the apartments open.
Brad Hoaglun, Meridian City Council president, said that when he married his wife 43 years ago, they were able to move to a duplex near downtown Meridian with one full-time and one part-time income.
“That is no longer a reality for people to come to Meridian and say ‘This is where I want to start,’” Hoaglun said. “A project like this is something that fulfills that need.”
Hoaglun mentioned that there are misnomers about those with low incomes. Many have jobs with incomes that just can’t keep up with increasing costs, some are young people who are just starting out, and some are retirees whose incomes come from retirement savings and Social Security, he said.
“This project is exactly what we need to see more of today: a haven for tenants who come from all walks of life,” said Irene Choi, senior vice president of acquisitions at Red Stone Equity Partners.
Red Stone is a New York real estate investment firm that specializes in low-income housing. The company has worked on five projects in Idaho, according to Choi.
Taking a chance
It was not easy to make the development pencil out, said Erin Anderson, the director of The Housing Co.
“When I found the listing for this piece of land in 2021, I was honestly at that time feeling very discouraged in my career,” Anderson said. “I’d spent over a year tirelessly looking for opportunities to purchase land, in several communities in Idaho, with zero luck.”
With “incredibly high” prices and a hot market, Anderson said it was challenging to find people who wanted to work with the complexities and long timeline of an affordable housing development. The idea nearly sputtered out multiple times.
When The Housing Co. found the 166,253 square-foot property at 1160 W. Ustick Road half a mile west of Settlers Park and about half a mile south of Sawtooth Middle School, Anderson decided to take a chance on it despite it being the most expensive piece of land the nonprofit had ever purchased.
“I actually live in this community,” Anderson said. “My children talk about their friends having to move out of town, because they can’t afford to live here anymore. My employees talk about not being able to live in Meridian. I knew that even though it was an expensive piece of land, it would be worth it.”
How and when to apply
The development will likely take 15 to 20 months before the partners cut the ribbon and open the complex. But The Housing Co. will start filling units before then.
It won’t start building a waiting list for about another year, Anderson said. Then, the process for snagging one of the units will be to call The Housing Co. or visit its website.
There will be an application form to complete. Interested tenants will have to prove their incomes through pay stubs or W-2 forms. Applicants will go through standard background checks, including a credit check and landlord verification.
What it takes to make affordable housing profitable
One of the most difficult aspects of building affordable housing, Anderson said, is making it profitable. With rent capped lower than market rate, it can be difficult to attract investors with the slim returns.
Like many affordable housing developments, funding had to come from a number of sources for The Housing Co. to reach the $15.6 million cost to build the complex.
The biggest boost came from Red Stone Equity Partners, which was able to take advantage of federal tax credits that promote low-income housing. Over half of the funding for the project came in tax credit equity totaling $8.8 million with Red Stone.
The Wood Rose Apartments also received a $3.6 million loan from Banner Bank, $400,000 from the city of Meridian and $528,000 from The Housing Co. itself.
The Housing Co. was also awarded a $1.5 million loan from the Department of Housing and Urban Development and a deferral of developer fees totaling $752,000.
Big downtown Boise apartment & YMCA development is threatened. What just happened
More housing for the chronically homeless is proposed in Boise. What we know
See the most expensive Boise mansion for sale now and the most expensive ever sold
These apartments are coming to site of popular former Boise shop. And they’re affordable
