The Iberville Offsites: A Model for Affordable Housing

By Special Contributor posted 04-21-2015 14:11

  

By Neal Morris

 Map of Iberville Offsites. | Credit: Redmellon Restoration & Development
Map of Iberville Offsites. | Credit: Redmellon Restoration & Development

New Orleans has never been a city of high-rises but of unique, colorful single-family homes. Yet nearly ten years into our recovery from Hurricane Katrina, the predominant redevelopment strategies are to build large apartment complexes and to rehabilitate schools and office buildings into multiplexes. The Iberville Offsites, 46 historic homes scattered throughout the city’s Tremé and 7th Ward neighborhoods, prove that it is possible to sensitively rehabilitate large numbers of single-family homes and provide affordable housing in the process.

There are still more than 40,000 blighted and vacant houses in New Orleans, and the inner-city population has not regained its pre-Katrina numbers. While the population metro-wide is at approximately 90 percent of its pre-storm level, within the city of New Orleans, our numbers are roughly 70 percent of what they were before the levees failed.

There is value in large housing complexes. It is easier for developers to provide affordable homes to our many deserving residents by focusing on large, multi-family structures. But hundreds and even thousands of historic homes nearby sit vacant and blighted. Any comprehensive redevelopment plan for the city has to include large-scale renovations of these homes.



The challenges associated with such an undertaking are enormous. Typically, a low-income housing developer will acquire a purchase contract or option on a single parcel of land. He or she then pursues low-income housing tax credits and other funding and then exercises the option or purchase contract once funding is secured.

 1001-03 N. Galvez Before Construction. |  Credit: Redmellon Restoration & Development
1001-03 N. Galvez before construction. | Credit: Redmellon Restoration & Development

But with scattered and blighted single-family homes there is no single owner. Some homes are owned by estates, others by municipalities, and others by private sellers. And rare is the owner of a blighted single-family home who will put a piece of property under contract for nine months while a developer obtains financing.

In 2013 our company, Redmellon Restoration & Development undertook the renovation of these single-family homes. Our company specializes in urban infill projects that involve the rehabilitation of the existing fabric of urban neighborhoods rather than building anew. In a post-Katrina landscape it didn't make sense to us to build new units in a megaplex when there were thousands of historic, blighted homes throughout our neighborhoods. We work with municipalities and carefully selected nonprofits, to combine the subsidies necessary to fund projects and then successfully bring them to construction completion. We also undertake projects for our own account. Each potential project must be socially worthwhile, have the potential for economic profit, and be fun.

The Iberville Offsites project consists of 46 scattered historic homes on 26 separate parcels. The project required 26 separate purchase contracts. Our first challenge was purchasing blighted properties from a myriad of owners before any financing had been secured. This approach, to put it lightly, is unattractive to commercial lenders and many developers. Fortunately, New Orleans is home to social-based investors and lenders who understand that we can only revitalize our neighborhoods by rehabilitating individual houses.

 1001-03 N. Galvez After Construction. |  Credit: Redmellon Restoration & Development
1001-03 N. Galvez after construction. | Credit: Redmellon Restoration & Development

After acquisition, but before financing was secured, we created separate sets of architectural plans and specifications for each home. The goals were affordability, historic preservation, and sustainability.

Affordability:

In order to rehabilitate 46 severely blighted homes, some held together entirely by vines, and keep rents affordable, we needed some financial creativity. In the end, the project required complicated layers of financing and an organizational chart that looks like a spilled plate of spaghetti.

The Louisiana Housing Corporation provided 9 percent per capita low-income housing credits that were syndicated by Enterprise Community Partners and purchased by Morgan Stanley. The Prudential Life Insurance Company provided key debt to allow the acquisition and mothballing of blighted properties. The New Orleans Redevelopment Authority sold us several of the houses at fair market value and also provided HUD Neighborhood Stabilization Funds. Permanent Supportive Housing, a program that provides affordable rental housing and services to people with disabilities, is provided through the State of Louisiana.

Historic Preservation:

New Orleans’s Tremé and 7th Ward neighborhoods have long been home to New Orleans’s working class and were the birthplace of some of the city’s most enduring cultural traditions. The great New Orleans jazz families grew up in these neighborhoods, as well as the Social Aid and Pleasure Clubs that supported African American families before they had access to life insurance. The second line parade, New Orleans’s signature celebration of life, family, and music, was created in these communities.

 One of the projects under construction. | Credit: Redmellon Restoration & Development
One of the projects under construction. | Credit: Redmellon Restoration & Development

The Iberville Offsites homes are all within the Esplanade Ridge or Mid-City National Register Historic Districts and were rehabilitated in accordance with the Secretary of the Interior’s Standards for Historic Rehabilitation. But we wanted to do more to preserve the area’s history than follow guidelines.

Too often historic preservation is seen as the domain of the affluent and white. The Iberville Offsites project clearly demonstrates that historic preservation is relevant in the lives of low-income people of color. A key aim of the project was to help the working poor living in these newly rehabilitated houses recognize their new home as a continuation of the area’s history and culture.

To this end, we condensed the historic research into a readily accessible packet to be included in each resident’s Lease Signing Package. Each packet provides a brief history of the neighborhood and the homes and attempts to demonstrate that the lives of the men and women who first lived in these homes were not so different from the lives of the person about to sign the lease. Contact information for neighborhood associations is provided. Leasing agents were trained to explain the “Historic Prez Folder” (as they call it) just like they explain lease terms and income requirements.

Sustainability:

Every time a historic home is torn down and dumped into a landfill, the lumber, bricks, plaster and flooring are wasted. Every demolition destroys a bit of the neighborhood that can never be replaced.

All of the Iberville Offsites were renovated in accordance with Enterprise Green Communities standards for sustainable rehabilitation. Yet the main environmental benefit of the project is not points claimed on a spreadsheet but the impact of maintaining housing as housing and avoiding trips to the landfill.

 40 N. Rocheblave under construction. | Credit: Redmellon Restoration & Development
40 N. Rocheblave under construction. | Credit: Redmellon Restoration & Development

All of the homes except one have solar photovoltaic arrays that produce energy and decrease energy costs for tenants. Sophisticated thermostats automatically switch the HVAC off if a window or door is left open for too long, saving residents from a sky-high utility bill for accidentally trying to air-condition the outside.

The Iberville Offsites are also part of a National Park Service study on spray foam insulation in historic structures. As generally used, spray foam insulation bonds to the historic material, thereby compromising its integrity and prohibiting reversibility. In the case of the Iberville Offsites, a removable barrier was wrapped around the historic framing before adding insulation. The National Park Service is now studying the long-term effects of installing spray foam insulation in small-to moderate-size, historic, frame buildings located in a humid climate.

In recognition of the success for sensitively rehabilitating single-family and two-family homes at scale, as well as providing affordable rental housing in the process, the project was awarded the National Trust/HUD Secretary’s Award for Excellence in Historic Preservation at the National Trust Conference in Savannah.

The model is replicable. Taking ownership of the disparate properties while they are teed up for financing, is the trickiest part. Given the ability to acquire ownership of the blighted housing, any experienced, creative developer has it within his or her power to execute a similar project in their hometown.

Neal Morris is the principal at Redmellon Restoration & Development, a mission-driven real estate development company based in New Orleans, Louisiana.



#AffordableHousing #RealEstate #Sustainability

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