Cook Inlet Housing Authority’s 3600 Spenard

3600 Spenard

She says that 3600 Spenard’s anticipated completion date is August of this year; they broke ground on the project in July 2016. 3600 Spenard is owned by CIHA, was designed by KPB Architects, and The Peterson Group is the project’s contractor. Construction will take fourteen months, but planning for a project like this is complex and takes much longer.

First and foremost, CIHA needs to secure site control. In the case of 3600 Spenard, the property was actually two separate parcels purchased at different times. One was a parking lot for a business that previously existed on the corner, PJ’s. “We were a little bit bursting at the seams with our folks, our employees, business partners, and our clientele, so shared parking became, as we have grown, a little bit more challenging. So we bought that parking lot for our employees to overflow to,” Gerow-Hanson says. It was later, after PJ’s had been seized by the US Marshals Service and sold at auction, that CIHA purchased the second parcel, about five years ago, she says.

Having secured the property, “You come up with a concept design,” Gerow-Hanson says. “You don’t go to full design, but you envision.” She says that CIHA has to consider parking considerations, how big the building can be, what size of units, what the mix of units will be, if the property will have retail space, etc. “It’s kind of like building blocks; you’re putting on and taking away, and you’re conceptualizing. This process also involves talking to the local community councils and neighbors about the concepts that we think will best suit the site and getting their feedback.”

For 3600 Spenard, “This site doesn’t feel like a family-friendly site, as far as like a large family of four or five people, but certainly one bedroom apartments seem like the fit for this site,” she says. “We feel it’s a great place to live because residents are going to have access—straight shot to downtown, straight shot to midtown—those are the hubs of employment. And so if you live here you have this great accessibility, walking, biking, driving, taking a bus—there’s a bus stop right outside of the building.”

Additionally, she says that the location in midtown Anchorage seems like a good fit for retail space options for many of the same reasons that it’s beneficial for residents: “There’s nice access off of Minnesota, there’s great access off of 36th and Spenard.” She says that 3600 Spenard’s retail space will be flexible, depending on the interest of tenants. Either the entire space can be utilized by one tenant or it can be broken up into up to three smaller retail spaces.

Finding Funding

With a solid concept, CIHA moves on to how to finance a project. 3600 Spenard has ten different funding sources, including Supplemental Grant Program funds, Alaska Housing Finance Corporation loans, CIHA loans, funds from the US Department of Housing and Urban Development, a Federal Home Loan Bank AHP Grant, Low-Income Housing Tax Credit Sale Proceeds, Alternative Energy Credit Equity, State of Alaska Demolition Grant, and a Rasmuson Foundation Grant. In total, CIHA sourced $10,339,501 for 3600 Spenard.

It’s a complicated process as the different sources of funding can come with different requirements. “We have a seasoned team that has been doing this, as a team, for sixteen years now,” Gerow-Hanson says. “They look at every angle of how to make it a successful development—financially feasible, livable, desirable as a place to live. They look at the design aspects with architects, and then they look at partnerships with equity investors, public and private funds, grant money from the state, grant money from Rasmuson Foundation, the Federal Home Loan Bank has a grant program that we’ve had access to, loans through AHFC, money from HUD, etc.”

She says CIHA also has funding through NAHASDA, the Native American Self-Determination and Housing Act. She says it’s a just a part of the funding, but “each source makes or breaks the deal because you’ve got little gaps that determine whether something can be built or not. If you don’t get the $50,000, or if you don’t get the $500,000, the whole thing can collapse.”

The largest portion of the funding is the Low-Income Housing Tax Credit Sale Proceeds at $6,078,703. Gerow-Hanson says, “The application for low-income housing tax credits, run through AHFC, is a long process. So you put forth your building concept and funding structure in the pre-development application and you are allowed to move on to the final round if your pre-application passes the first test. If you pass that first mark, you get to apply for an allocation of low-income housing tax credits. So you’ve got months leading up to the pre-application, and it’s competitive, and you don’t know how many other people are going to be applying for the allotment of low-income housing tax credits.”

The different funding sources can have requirements for the building once it’s built. 3600 Spenard is a mix of retail space and thirty-three one-bedroom apartments that will have units for rent at both market rate and to those with household incomes less than or equal to 60 percent of Area Median Income.

The application process for the apartments that aren’t rented out at market rates can be lengthy. CIHA can’t simply approve applications— a third party has to verify the applicant’s information and there’s a screening process in addition to lots of documentation.

“Eligibility is a big part of what we do, compliance, all of that’s driven by the sources of funding,” Gerow-Hanson says. “They tell you the scale of eligibility based on household income; you can’t be a dollar over that and qualify for the unit. If it’s set aside for someone who’s 60 percent of area median income or below, that’s a hard line.”

3600 Spenard

3600 Spenard will have an elevator for access to the second and third floors, and a key will be required for access to all of the residential areas of the building. The apartments at 3600 Spenard will have a rental range of $785 to $1,250 plus electric. Each unit is approximately 650 square feet, will have a washer and dryer in unit, and will have a small private deck or balcony. The building will have secured, covered bike storage; additional storage in the building for tenants; and a second-story deck available for all tenants “which faces the mountains; it’s an incredible view,” Gerow-Hanson says.

“We’re known for building colorful properties, that’s one of our trademarks,” she says. “It’s directly related to the fact that color matters and having just a beige development, or a gray development, does not excite us, and it does not add to the community.” For 3600 Spenard, CIHA is developing the ability to project images on the outside of the building. The projected images can feature different artists or change to match a season or theme. “It gives us the ability to bring light and playfulness during our darkest winter days and months.”

Gerow-Hanson says 3600 Spenard will feature photo voltaic and geothermal alternative energy systems to offset some of the building’s utility costs. She says utilizing solar and geothermal allows CIHA to keep the rents of the apartments as low as possible. “The more we can offset the costs associated with common lighting—lighting that’s in the parking lot, lighting that’s in the common spaces— that helps keep the overall cost down which means then you don’t have to keep raising rents to make up for the fluctuation in your utilities,” she says.

CIHA’s current buildings are constructed to a 6-star energy rating, Gerow-Hanson says. “That means we’re building a tight building; the buildings have to breathe but you’re doing the right insulation so that it’s operating at the highest efficiency. Utilities are generally quite low for the renters because you’ve built this nice envelope on the building.” She says that keeping rent and utilities affordable is vital for their mission of independent living, as their tenants “have money to spend at retail locations, money if they get sick, money to fix their car, all those things that are part of the cycle that can push people to homelessness—that one paycheck away from a disaster.”

She continues, “Having buildings and apartments like this that allow you to put money in savings, that rainy day fund, allows you to have the opportunities when you get that hiccup that happens, it doesn’t push you to homelessness. It gives you the opportunity to move, to stabilize, and then move up and out. So that’s the continuum of housing that you want to see.”

Spenard Community

Gerow-Hanson says that CIHA has purchased other parcels of land in the Spenard area in recent years, and 3600 Spenard is just the first property that the organization would like to develop. She says eventually CIHA would like to build a community/cultural center both for their residents and for the Spenard community in general.

CIHA’s office is located next to 3600 Spenard, and she says some of CIHA’s staff live in the area. CIHA received a $3 million Community Development Investment program grant from ArtPlace in 2015, and Gerow- Hanson says CIHA is looking to deploy that money in Spenard. “Our aim is to be a catalyst in the neighborhood; our aim is not to do it all but to start to show other potential investors, other developers, that there’s something exciting going on and have them get interested and do other types of private development.”

Tasha Anderson is an Associate Editor for Alaska Business Monthly.