Some Poplars tenants struggle to find affordable housing after Kitsap County sale

SILVERDALE — A notice at the end of April informed Shawn Stever that the rent for his one-bedroom unit in the Poplars Apartments would nearly double: from $750 to $1,200.

Stever, whose sole income is the payments he receives from Social Security for his disability, has lived at the Poplars for more than three years. The complex, nestled in a commercial area off Silverdale Way and bordered by Poplars Avenue, was sold by Kitsap County to a group of local investors in April.

Stever was among several residents who received new lease terms following the county's sale of the complex to Poplars LLC, a group of local investors that includes Kitsap County commissioner candidate Josh Hinman.

Election 2022: Why Josh Hinman wants to be county commissioner

The Poplars Apartment was purchased by Poplars LLC to create housing for young adults in Kitsap County, according to Hinman.

There are three buildings in Poplars, and Stever lives in Building C. Reid Management forced tenants in Building A and B to move out of Poplars earlier to renovate the units there, according to Stever and several tenants who reached out to Kitsap Sun.

Like other residents who receive new lease terms when complexes change hands, Stever described a state of shock upon seeing the new rental rate. Rushing to the property manager, Stever was told that he could accept the new terms (and agree to a seven-month lease that began June 1) or move out by the end of May.

Stever signed the seven-month lease to buy some more time, withdrawing money from his 401(k) account from previous work to cover the difference. He receives disability benefits because of a serious neck injury in 2017 that severely limited mobility in his hands and arms. He receives about $2,000 a month.

Then a 90-day notice to vacate arrived on Sept. 30, with Reid Property Management writing that his apartment will be renovated in 2023. If he wants to stay past Dec. 31, the document said, an extension of the lease for one to four months may be offered, with an increase in monthly rent to $1,400.

Stever has browsed housing options around the area.

"There's no rent that I can afford," he told Kitsap Sun.

Complex goes from public to private ownership

Kitsap County owned the property for 10 years after acquiring it from Housing Kitsap, which offers subsidized housing across the county.

When ownership was transferred from Housing Kitsap to Kitsap County in 2012, tenants received Section 8 vouchers that could be used at any complex in the country accepting the federal subsidy.

Read more: Housing authority approves transfer of Silverdale's Poplars to county

After the county took ownership, the properties ceased to be low-income housing, said Eric Baker, Kitsap County deputy county administrator.

The county knew it didn't have the staff to handle the daily management of the property, so it contracted with Reid Property Management from 2012 to 2022 to manage Poplars, Baker said.

The management company established rent based on comparable properties, managed tenant relations and oversaw maintenance. The county used rent proceeds to pay down the debt associated with the property and to fund maintenance activities, Baker said.

For nearly a decade, Kitsap County looked for opportunities for the complex as part of its vision for a Central Kitsap Community Campus, but all the plans the county explored had "significant obstacles due to the property configuration, traffic access and parking needs for potential new uses," Baker said.

As time passed, repairs were going to be necessary and the county determined it was not best positioned to make those investments. It put the complex on the market and found the buyer, Baker said.

Previous coverage: Kitsap County sells Poplars Apartments in Silverdale for $4.6 million; investor connected to Newlife church

Hinman, who spoke to the Kitsap Sun for Poplars LLC when the sale was announced in May, said in an email to Kitsap Sun this month that when the county owned Poplars, tenants signed month-to-month lease agreements with the understanding that all leases would be terminated when the building was sold.

All tenants were informed that their units would be remodeled when the building was purchased in April, according to Hinman. The investment group is currently renovating the units, and there isn't a specific timeline for the construction, as most apartments have needed extensive remodeling, Hinman said.

The current rent of the Poplars is approximately 70% of market rate. Poplars LLC bought the apartments from the county "at full market price and at a price that assumed full market rents" in April. At that time, the county's rent rates were only 40% of market rate, Hinman said.

"Even with the significant investment to address deferred maintenance, these are still lower than market rent apartments," Hinman said.

In addition, Hinman said that Poplars LLC, as a private investment group, pays additional costs the county did not incur, such as property tax and insurance.

New style of housing for Kitsap

Aimed at providing housing for young adults, Poplars LLC runs the apartment in a "roommate structure," which allows tenants to hold their own lease in a roommate environment.

This means if one roommate moves out of a multi-room unit, other roommates won't be responsible for bringing in a new tenant to share the overall rent. Each tenant signs their own lease agreement separately with the apartment. The model has primarily attracted young adults, Hinman said.

"This allows for a lower income requirement, lower rent costs, and less risk to the tenant," Hinman said.

The housing in Poplars is not limited to students or people affiliated with Newlife Church, which has its training center just west of the Poplars, across Poplars Avenue and next to the Haselwood YMCA. Many of the current tenants are employed in the Kitsap community, and anyone can apply for the units when apartments are available, Hinman said.

In addition to being executive director of Newlife, Hinman is a governor of Poplars LLC, which partnered with Newlife Leadership College. As a Kitsap County commissioner candidate, Hinman has been questioned on social media about his investment in Poplars and tenants being forced to leave.

"Regarding the apartments, I am a member of a private investment group that purchased the property. My personal investment choices will remain intact. There is no requirement for those holding public office to divest their personal investments in order to serve the office," Hinman wrote on his campaign Facebook page, Elect Josh Hinman, in June.

More: Hinman, Walters spar at debate in race for Kitsap County commissioner

Hinman said in an email to the Kitsap Sun that the county's housing affordability crisis will be solved by building additional housing units, reducing government fees and "creative housing solutions."

"As a new real estate investor, my eyes have been opened to the challenges facing our development community. As a nonprofit leader, I am also aware of the inflated housing costs facing residents in our community. It is one reason I am running for County Commissioner," Hinman said in the email.

Reach breaking news reporter Peiyu Lin at pei-yu.lin@kitsapsun.com or on Twitter @peiyulintw.

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This article originally appeared on Kitsap Sun: Tenants struggle to find affordable housing after Kitsap County sale