City works to assist middle-income housing construction

With housing prices squeezing middle class renters and buyers in Boston, the rising cost of land remains a challenge to efforts to hold down the cost of new units.

The administration of Mayor Martin Walsh is seeking to reduce that cost, offering land at a reduced price to developers for the construction of homes affordable to middle-income buyers through its Neighborhood Homes Initiative.

When Walsh took office, the Department of Neighborhood Development inventoried all city-owned parcels and identified 250 suitable for residential construction based on location, size and other factors. To date, 73 units are in construction on these parcels, with 45 slated for later this year, according to the Dorchester Reporter. As of mid-December, 36 parcels were sold, and developers were in the process of closing on 16 more, according to the DND. All parcels ultimately will be used and a bulk of the city-owned land is in Roxbury, said Lisa Pollack, DND director of media and public relations.

“[Mayor Walsh aims] to return as much city land to the highest, best use,” she said in a phone interview with the Banner.

The NHI program has met favorable responses from developers for streamlining the process, Pollack said. Community members are engaged on the initial designs for the units, which frequently are single- or two-family homes, before plans are sent to the Boston Planning and Development Agency for approval. Only then are requests for proposals issued and developers selected. As such, the developers enter the process with community negotiations and permitting largely settled, Pollack said.

DND seeks small developers to purchase and construct the housing. Pollack did not have information on the percent of minority developers engaged. While the city legally is not allowed to turn over land for free, it offers levels of subsidies that vary by project, Pollack said.

To facilitate small developer involvement, DND hosts seminars on how to do business with the city and how to collaborate with other small firms to create a joint venture that has the capacity to be competitive on larger bids, Pollack said.

The units are promoted to moderate- and middle-income prospective homebuyers. The individuals undergo review by the Boston Home Center before approved applicants are selected via the NHI housing lottery, states the Dorchester Reporter.

The program also is a financial win for the city, with new developments bringing in new taxes, the DND reports.

The NHI program has a finite end: The city holds only so many parcels and has few ways of gaining more. The only way property enters DND’s inventory is through foreclosure, seizure for nonpayment of a vast amount of taxes or acquisition of a parcel when it is no longer needed for its current use. For example, when the Grove Hall public library branch was reopened on a new site, the previous library building was considered “surplus” and given to DND to assign new use.

A related effort by DND involves rehabilitating abandoned, foreclosed buildings into homes available to middle-income buyers. By mid-December 2016, the program had completed rehabilitation of one unit, with two more under construction and two more ready for construction to start, according to the DND.