Most people think that recycling promotes the common good. But it could mean losing your apartment or condo to an upscale developer. According to the recently released “Columbia Pike Land Use & Housing Study Preliminary Analysis Report,” drafted by Dover, Kohl & Partners, that’s what’s happening on Columbia Pike right now. Commissioned by the County to determine the feasibility of undertaking residential redevelopment of the Pike, Dover, Kohl candidly reports that of about 1000 new apartments constructed on the Pike since 2009 all are “high-end luxury units with no committed affordable housing.” p. 1.17. Rents on renovated units shot up–even doubled–and tenants have been evicted to make way for “repositioned”, i.e. upscale apartments. This is just the beginning. Driven by the demand for transit oriented housing near DC, Dover, Kohl reports:
“Real estate investment trusts (REITs) and other institutional buyers are exhibiting great interest in acquiring existing apartment complexes in Arlington and other close-in jurisdictions. Renovation and repositioning of those complexes will result in much higher rent increases.” p. 1.18.
Noting that rents along Columbia Pike have increased almost 60 percent since 2000 and that 35 percent of households on the Pike paid more than 30 percent of income for rent in 2000 before the latest rash of rent increases, the authors predict that the soon to be constructed trolley will increase rents even more. So why does County Board, which insists that it wants to preserve affordable housing, want the trolley, especially when existing bus service is described as “outstanding” by the study authors? The principal finding of the report is that redevelopment of the Pike is economically feasible only if the apartments are replaced with new units at triple the current density. So the purpose of the trolley is to induce additional tenants into the corridor. That many of them probably can’t afford to is reflected in the fact that median income has lagged behind inflation.
If this raises questions about the long term economic sustainability of redeveloping the Pike, not to worry. Dover, Kohl’s economic consultant, Partners for Economic Solutions (PES), developed a model that showed the approximate cost to the County to subsidize committed affordable units set aside for low to moderate income tenants. The subsidy is the difference between the residual land value (capitalized rental income stream, less redevelopment costs and return on investment) and the current market value of the property. Under a scenario requiring the County to subsidize the cost of preserving all 3,151 Pike units affordable at 60% area median income (AMI) and half the 3,327 units affordable at 80% AMI, the total cost to the County would be $286 million, or about 30 percent of its annual budget.
With rounding for inflation the total cost to the county of redeveloping the Pike is $160 million for the trolley (2010 estimate) + $290 million to subsidize affordable housing = $450 million. This doesn’t include the cost of additional infrastructure improvements like schools and streets to accommodate three times as many people. Unless the Obama administration agrees to pay for the trolley, the total cost is going to be absorbed by tax payers throughout the county, not all of whom equate densification and gentrification with Smart Growth.
Tripling the density of the Pike when the schools are already overcrowded is irresponsible. Committing the County to pay for an unneeded extravagance to draw more people in is reckless. Although Dover, Kohl has provided an invaluable service in reporting the true cost of redeveloping the Pike, I oppose the total urbanization of Arlington County by the Arlington County Board to serve the wants of out-of-state REITs, developers, and planners.
Enough is enough. We are a tiny suburban County, not a major urban “redevelopment opportunity”. Please join me in halting overdevelopment and recycling middle income people out of this county. Support my campaign for Arlington County Board.