A new kind of housing? 2 micro-housing projects could bring 300+ apartments to downtown

ASHEVILLE - Two impending projects could mean more than 300 units of a new kind of housing in Asheville: Micro-apartments. Slated for downtown, the about 200-square-foot units are billed as "studio apartments," but with a communal living space and only a kitchenette inside the room.

Developer David Moritz said they will be the first projects of their kind in Asheville but pointed to his business partner Scott Shapiro's similar projects in Seattle, Washington, and Nashville, Tennessee, as the blueprint.

It's intended to help fill the gap, he said — creating walkable workforce housing in a city where affordable housing needs have reached a breaking point.

Previous coverage:Asheville's 2nd micro-housing development: 231 units approved downtown; 200-350 sq. ft.

More:Asheville's first micro-housing development approved by planning board

"What is anybody doing about it?” he said. “It’s like, we’ve got to think of something."

But while a need for more housing in Asheville is unmistakable, given one of the worst rental markets in the state, planning board commissioners have questioned how this new housing model fits into the city's Unified Development Ordinance, which contains most local regulations regarding the use and development of land and buildings.

When will the first development break ground?

More:Asheville’s largest landlord stopped accepting rent assistance; How this hurts families

More:Living in less than 200 sq. ft.: New Nashville micro-apartments open in Wedgewood-Houston

The projects, an 80-unit development at 217 Hilliard Ave. and a 231-unit development at 46 Aston St., were approved by the city's Planning and Zoning Commission in October 2021 and November 2022, respectively.

The Hilliard Avenue project, named Hilliard Flats, will be the first to break ground. Moritz anticipated construction would begin in the next several months, by the second quarter of 2023.

An 18-month build, it puts completion near the end of 2024. All construction drawings and permitting is complete, he said, but rising building costs have caused some delay.

All units will be between 200-250 square feet, Moritz said, and the five-story building will be built on a 0.18-acre space of what's now a parking lot next to the former Hot Spot at the corner of Hilliard and Asheland avenues.

More:Answer Man: Hot Spot convenience store closed forever? Or will it become a wine bar?

All 80 units will be for rent and roughly the size of a double dorm room at UNC Asheville, outfitted with a mini-fridge, microwave and sink. Every apartment has a private bathroom, and each floor will have shared kitchen and lounge facilities. Laundry facilities will also be located in the building.

Neither project has associated parking.

Both projects are a joint venture from Moritz's company Mori Blue Holdings LLC and Shapiro's Seattle-based Eagle Rock Ventures LLC.

Developer to seek tax abatement on Aston Street project

Though the project itself is approved, the Aston Street development will be returning to the City Council agenda in February as Moritz seeks a Land Use Incentive Grant, or LUIG, a city property tax abatement program in exchange for affordable housing.

The Hilliard Flats project will be city-subsidized in exchange for 20% of its units, or 16, being deeded affordable at 80% area median income or below for 20 years, following City Council approval in June.

More:Fact checking the Asheville busing myth: Are homeless people being bused into the city?

More:From the Buncombe County archives: Where did the busing story originate and when?

The Aston Street project includes two new seven-story residential buildings, divided into 72 and 159 units, on a 0.64-acre parcel, currently home to a surface parking lot and one-story garage building near outdoor music venue Rabbit Rabbit and Asheville Brewing Co.

For the city tax abatement program, like Hilliard, the Aston project will offer up 20% of its units, or 46, to be deeded affordable at or below 80% area median income for a minimum of 21 years, Moritz said.

According to the city's 2022 appendix of affordable AMI rents, maximum rents for an 80% AMI efficiency/studio with utilities included is $1,125.

Moritz said "at this point," the intention is for all the apartments to be leased at a market rate of about $1,000 a month, with utilities and internet included.

Subject to City Council approval, the LUIG application will appear on its agenda Feb. 14, with stops at the Housing and Community Development Committee and finance committee earlier that month, he said.

Does micro-housing fit Asheville's UDO?

There was some discussion at the Nov. 2 Planning and Zoning Commission about whether micro-housing met the standards of a "dwelling unit" enough to adhere to the UDO definition.

Will Palmquist, the city's principal planner, said Feb. 2 that staff determined micro-housing meets the definition of dwelling units.

"There was discussion about the dwelling unit and kitchen definitions (cited below), and whether this project and the microhousing units met the requirements," Palmquist said via email. "We determined that because the units would have microwaves and a refrigerator provided, they met the definition of a kitchen."

More:West Asheville Baptist Church-owned house gets planning board OK for rezoning request

Per the UDO, a dwelling unit "means one or more rooms physically arranged so as to create an independent housekeeping establishment for occupancy by one family with separate toilets, sleeping rooms, and a kitchen."

A kitchen is defined as: "an area within a structure that is used or designed to be used for the preparation or cooking of food."

"We are looking into adding a definition of microhousing to the UDO and will prioritize this with other changes that are needed as well," Palmquist said. He confirmed since Moritz's two micro-housing developments, no others have been applied for.

Shapiro told the Citizen Times he has 11 completed micro-housing projects among Seattle, Nashville and Eugene, Oregon, with another underway in Fort Worth, Texas.

There are 723 micro-apartment units between all finished projects.

“Ours fits the code in Asheville and it meets a need," Shapiro said of the micro-housing model. "Asheville is very supply constrained, it has lots of demand. It’s a very walkable downtown, and there’s not enough housing downtown for people that want to live there and work there."

More:Madison Cawthorn pleads guilty to speeding violation, awaits gun charge

Though the price is fluctuating, he said, due to construction costs and interest rates, he still anticipates it will be "the most affordable new product downtown."

Moritz said, clearly, he found the project to fit within the UDO. While people have tried to "fit this into a box" of other housing types, such as an extended stay hotel, he said it is more akin to a studio apartment, "fully functioning, brand new" with a bathroom and large windows.

“Some people may or may not like it. Some people have the privilege of owning a home, like I do. Not everybody does. This is a choice people will make," Moritz said. "If someone decides to live there, they’ve decided it’s the best option for them in Asheville.”

Sarah Honosky is the city government reporter for the Asheville Citizen Times, part of the USA TODAY Network. News Tips? Email shonosky@citizentimes.com or message on Twitter at @slhonosky. 

This article originally appeared on Asheville Citizen Times: What's the status of Asheville's 2 approved micro-housing projects?