URA lays groundwork for small landlord program; 5 Pittsburgh projects win tax credits

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A meeting for the Urban Redevelopment Authority of Pittsburgh. Photo by Kat Procyk/PublicSource)

Leadership from the Urban Redevelopment Authority at a January 2019 meeting of the URA Board of Directors. (Photo by Kat Procyk/PublicSource)

As part of Develop PGH, PublicSource will report here about notable actions and conversations from the monthly meetings of the Urban Redevelopment Authority [URA]. The meetings are held the second Thursday of each month in the Wherrett Room on the 13th floor at 200 Ross Street.

For the Urban Redevelopment Authority, 2019 has been a year of rolling out long-awaited programs to address a lack of affordable housing, and today those efforts have garnered support from state officials who awarded Low Income Housing Tax Credits [LIHTC] to five projects in Pittsburgh. The program, administered by the Internal Revenue Service, offers coveted tax incentives to developers who build below-market housing units in exchange.

According to a press release from Mayor Bill Peduto's office, the five LIHTC awards comprise "the largest number of Pittsburgh developments to receive the low-income tax credits in memory."

Of the 39 awards announced Thursday by the Pennsylvania Housing Finance Agency, the five in Pittsburgh were:

  • Larimer School preservation and reuse: 35 units of mixed-income housing in Larimer from St. Louis-based McCormack Baron Salazar and Allies & Ross Development, the nonprofit development arm of the Housing Authority of the City of Pittsburgh [HACP].
  • North Negley Residences: 45 below-market-rate units in Garfield from Beacon Communities Services LLC, Ralph A. Falbo, Inc., and MCAPS LLC.
  • Flats on Forward in Squirrel Hill South: A project of Action Housing, Inc. with new construction of 43 below-market-rate units, retail and office spaces.
  • New Granada Square in the Hill District: A project by the Hill Community Development Corporation and CHN Housing Partners that includes new construction of 40 below-market-rate rental units and 7,200 square feet of first-floor retail space.
  • City’s Edge: From developer Midpoint, the project includes 70 below-market-rate units in Uptown.

A recap of the July 11, 2019 URA board meeting:

        • The board approved a $500,000 loan from PNC Foundation for a new “Small Landlord Fund” as part of the HOF. The Small Landlord Program would provide loans of no more than $60,000 to landlords so they can make repairs to pass inspections required as part of the Housing Choice Voucher program, the formal name for Section 8. The repairs must be for buildings with no more than five units.

          The board also approved an application for a $250,000 state grant for the Small Landlord Program.
        • The board also approved a six-month negotiation window to sell 34 parcels of land on two sides of the intersection of Fifth Avenue and Dinwiddie Street in Uptown to a development group that plans to build two mixed-use buildings with 167 rental units. Of those housing units, 16 would be reserved for households at or below 60% AMI, 13 at or below 50% AMI, and four units at or below 20% AMI.
        • The housing development would feature a mix of micro, one- and two-bedroom units.The $51 million plan, proposed by a developer group made up of Bridging the Gap Development and HB Development, also includes a repurposing of a city-owned warehouse building on the east side of Dinwiddie for a mixed office and commercial building. The project’s financing hinges on a 4% Low Income Housing Tax Credit award that the developer group plans to apply for next year.
        • The board approved a $650,000 loan from the Housing Opportunity Fund’s [HOF] Rental Gap Program as the final piece of financing for a $15 million renovation of the former Lemington Home for the Aged in Lincoln-Lemington-Belmar. The project will create 54 one-bedroom units for seniors, according to Jessica Smith Perry, director of the HOF. A deed restriction included in the project will dictate that 10 units of the Lincoln Avenue property in the building will be rented to households with incomes at or below 30% of the area median income [AMI], and 44 units will be rented to households making at or below 50% AMI.

          The developer group, a limited partnership between Ralph A. Falbo, Inc. and AWK Development, has also secured a commitment from the Housing Authority of the City of Pittsburgh [HACP] for project-based Section 8 rental assistance. Under the program, residents of all 54 units will pay no more than 30% of their gross income in housing costs. HACP will use federal dollars to pay the remaining 70% of costs.A new primary care center from East Liberty Family Health Center will operate on the ground floor, along with an adult day center, Smith Perry said.
        • The board also approved the URA’s acquisition of 21 parcels from the City of Pittsburgh on Herron Avenue, as well as Milwaukee and Ossipee streets, to make way for a proposed residential townhome development from Amani Christian Community Development Corporation. The organization is working with Catalyst Communities, LLC on the details of the plan, according to Nathan Clark, URA’s real estate department director.
        • The board approved $200,000 allocated to the URA by the city for a pilot program that aims to guide small business owners in creating development projects for URA-owned land in the Centre Avenue corridor of the Hill District. A neighborhood development organization, Neighborhood Allies, will conduct the services as part of the pilot, called the Equitable Empowerment Program. The authority’s target date to release a request for qualifications is July 22, said City Councilman and URA Board Co-Treasurer R. Daniel Lavelle. The councilman, whose district includes the Centre Avenue corridor, said the goal of the pilot is to have as many minority- and women-owned businesses as possible to join in the redevelopment of Centre Avenue.

      Tom Lisi is PublicSource's Develop PGH reporter. You can reach him at 412-368-6480 or by email at tom@publicsource.org.Develop PGH has been made possible with funding from The Heinz Endowments.

      A recap of the June 13, 2019 URA board meeting:

      From new homeownership opportunities using community land trusts to the rehabilitation of aging homes for low-income renters, the Urban Redevelopment Authority board of directors pushed through project after project tied to affordable housing initiatives on Thursday.

      “Every one of these actions has the added benefit of proving the Realtors Association wrong,” board chair Sam Williamson said. The Realtors Association of Metropolitan Pittsburgh’s opposed the city’s funding of the Housing Opportunity Fund [HOF] through an increase in Pittsburgh’s realty transfer tax, arguing it would increase costs tied to buying and selling real estate for low- and moderate-income residents.

      After a delayed rollout of HOF programs, the fund has provided monetary support to projects that have improved or created 616 low-income households so far this year, according to a presentation Jessica Smith Perry, the fund’s director.

      The latest HOF action approved Thursday included:

                • A series of grants and loans to Lawrenceville Corporation to buy six homes to enter into its Community Land Trust. The grants and loan, totaling $825,000, will go to the $1.6 million project to establish the homes as “permanently affordable.” $300,000 of that will come from the HOF For-Sale Development Program, which funds the rehabilitation of existing homes that can be subsequently sold to households with incomes at or below 80% AMI. The trust requires that the homes later be sold at a below-market price to preserve affordability.
                • The board also approved a similar plan from the Oakland Planning and Development Corporation, financed in part by $140,000 from the For-Sale Development Program. The project will renovate five homes on Frazier Street, which will also be sold to households with incomes at or below 80% AMI.
                • Also through the HOF, the Hill Community Development Corporation secured $135,000 in financing for the rehabilitation of two homes to be sold to households at or below the same 80% AMI threshold.

      Though not part of any HOF program, the board approved an additional $1 million loan to finance a $41 million housing rehabilitation project in the North Side by managed by Mistick Construction.

      The plan is the second of four phases to refurbish 324 units in existing housing stock in the North Side built more than a century ago. The collection of homes, spanning California-Kirkbride, Central Northside and Perry South, will be rented to households at or below 50% of Area Median Income [AMI] through a U.S. Department of Housing and Urban Development Section 8 program.

      The average cost of renovations is $200,000 per building, according to URA officials, and most of the buildings will get gutted and reframed.

      The financing for the second phase of the project also includes $14 million of federal Low Income Housing Tax Credits and $4 million in Historic Tax Credits from the National Park Service.

      The board also authorized the URA to sell $18 million in bonds to help finance the third phase of the North Side rehabilitation project, which aims to complete another 70 units. While URA officials expect the phase two deal to close next month, Mistick is waiting on various tax-credit awards for the third phase. That deal could close in 2020.

      In other action, the board approved the sale of the former Homewood School to the City of Pittsburgh to develop the property into an expansion of nearby Stargell Park. The URA bought the property three years ago for $235,000 and is now selling it to the city for $1.

      Tom Lisi is PublicSource's Develop PGH reporter. You can reach him at 412-368-6480 or by email at tom@publicsource.org.

      Develop PGH has been made possible with funding from The Heinz Endowments.

      A recap of the May 9, 2019 URA board meeting:

                  • The URA board of directors approved $1.36 million in zero-interest loans to to help finance a $13 million mixed-income housing development in East Liberty. Residents displaced from Penn Plaza will have top priority in the application process. The development at the corner of Station and North Beatty Streets, will feature 25 below-market one-bedroom units with rents between $196 to $609 a month, 12 two-bedroom below-market units with rents between $235 and $777 a month, and 10 one-bedroom market-rate units at $1,700 a month.Four units will be rented to households with incomes at or below 20% of Area Median Income [AMI].Twenty units will be rented to households with incomes at or below 50% AMI, and 13 units will be rented to households with incomes at or below 60% AMI. Pittsburgh-based TREK Development Group is overseeing the project, which is also supported by more than $10 million in low-income housing tax credits.
                  • The board approved a plan to allocate $10 million for the URA’s Housing Opportunity Fund [HOF] for 2020. The plan is almost identical to this year’s, which split the pot up between five programs for both renters and homeowners. The largest item, designed to fund affordable housing construction, calls for $3.75 million next year, a slight decrease from $3.8 million this year. The new plan calls for $500,000 in contingency spending if new programs are added, according to Housing Opportunity Fund Director Jessica Smith Perry. URA officials estimate altogether the HOF allocation will serve 565 rental or homeowner households. Pittsburgh City Council has final say over approval.
                  • The board approved $1.66 million in loans for an $8 million project from East Liberty Development Inc. to rehab 20 existing homes and build six new ones. Seventeen of the 26 homes in the project will be set aside for homebuyers whose household income is at or below 80% of AMI. The homes are scattered through the East End, including in East Liberty, Garfield and Larimer.
                  • The board also approved a plan to apply for two $250,000 state grants from the Department of Community and Economic Development: one to help recoup costs of the URA’s purchase of 643 acres of Hays Woods, the other to fund construction of trails and park amenities in the Frick Park extension. The URA has so far secured $3.3 million in public in private grants to cover the $5.3 million Hays Woods purchase.

      A recap of the April 11, 2019 URA board meeting:

                  • The URA Board of Directors approved a $1 million sale to developer group Connection TWG of a 2.3-acre vacant lot at South Side Works, behind 3125 E. Carson St. The sale makes way for construction of a 280-unit building, including 28 units that will be reserved for households making no more than 50 percent of the area median income [AMI]. The URA negotiated the affordable units by bringing down the sale price of the valuable lot, according to URA Real Estate Director Nathan Clark. The developer plans to begin construction next month.
                  • The board also approved the $102,000 sale of a quarter-acre lot in South Side Works to a company called SSW Waterfront, LLC. The company plans to build a clubhouse at the western end of South Water Street for the South Side Marina. The expected project cost is just north of $1 million.
                  • The board approved the City of Pittsburgh’s “Clean Construction Diesel Operations” policy, which requires contractors on URA projects of at least $2.5 million to use ultra-low sulfur diesel fuel in diesel-powered construction equipment.
                  • The board made permanent the URA’s Micro Enterprise Fund, a program the authority piloted over the past year. The program finances loans up to $20,000 for small, neighborhood businesses in Pittsburgh. Tom Link, director of the URA’s Center for Innovation and Entrepreneurship, reported that 23 of the 24 businesses that received loans were either women- or minority-owned. Link said the authority does not recoup the costs of administering the program.
                  • The board approved a plan to sell six vacant buildings and 13 vacant lots in Manchester to the Housing Authority of the City of Pittsburgh [HACP] as part of the housing authority’s project to rehab 86 housing units created under the federal HOPE VI revitalization program. HACP will also build 40 new affordable modular units under the plan.
                  • The board approved a $1 million loan to AHI Development, an affiliate of ACTION-Housing, to build a six-story, mixed-use building at the site of the former Squirrel Hill Theater. As part of the $27 million project, AHI plans to include 37 one-bedroom units and six two-bedroom units at below-market rates. A quarter of those units will be for residents with disabilities.

      A recap of the March 14, 2019 URA board meeting:

                  • The URA Board of Directors approved a redevelopment proposal from Pittsburgh-based TREK Development Group for several lots next to the Garden Theater building on North Avenue. TREK’s preliminary plans include a five-story apartment building with 63 rental units along North Avenue, adjacent to the Garden Theater, and on several lots on Federal Avenue. TREK’s tentative plans include a retail space on the ground floor. The developer estimates project costs to run close to $7.7 million. (Here is a previous PublicSource story on the Garden Theater block.)
                  • The board also approved a proposal for the sale of land on North Lexington Street in Homewood for $3.2 million to ICON Development and KBK Enterprises, two Pittsburgh-based developers. The 12-acre site includes a pair of existing buildings where the developers say they will build new office space. The office complex will include rent as low as $10 per square foot to support newer companies. Other space will go for as much $30 per square foot, according to ICON. A final plan for the site will come before the URA board again for approval.
                  • The board also approved a $1.2 million URA loan agreement with ACTION-Housing for a 35-unit affordable housing complex in Lower Lawrenceville. Most of the units will cater to households with incomes at or below 60 percent of the area median income, a metric calculated by the U.S. Department of Housing and Urban Development.
                  • The URA’s new Housing Opportunity Fund received approval for $750,000 to contract with social service providers for programs to assist renters and homeowners. Neighborhood Legal Services and the YWCA of Pittsburgh, among other organizations, will work with residents who need legal help to avoid eviction or to get the title of their home placed in their name.
                  • The Hill District Community Development Corporation also received a $50,000 grant, the final funding piece for the organization to renovate the ground floor of the historic Granada Theater building. Hill Community Development Corporation CEO Marimba Milliones said at the meeting that the organization expects to have a ribbon cutting for the project this summer. The ground floor will be home to Hill CDC programs that help local residents start or expand businesses.

      Tom Lisi is PublicSource's Develop PGH reporter. You can reach him at 412-368-6480 or by email at tom@publicsource.org.

      Develop PGH has been made possible with funding from The Heinz Endowments.

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