City of Aspen to float construction loans for affordable housing developer
Forty-five new affordable-housing units coming online in the upper valley in the next few years are closer to reality now that Aspen City Council has taken steps to finance three projects.
On Monday, council initially signed off on ground leases, loan agreements and the financing for projects to be built by Aspen Housing Partners on city-owned land.
The city has selected the private company to construct rental housing at 517 Park Circle, 802 W. Main St. and 488 Castle Creek Road.
The city’s total contribution toward those projects is estimated to be $16.1 million, according to Chris Everson, the city’s affordable-housing project manager.
The city is providing loans to the developer so that each project will receive lower interest rates than what the commercial market would offer.
According to the stipulations set forth by the city and approved by council, Aspen Housing Partners will construct and operate 11 rental units on the Park Circle site.
That includes seven one-bedroom units and four two-bedroom units that will be deed-restricted for income categories that serve middle-income individuals.
The city will provide a construction loan to 517 Park Circle, LLC for just over $1.2 million, which will be repaid when the building is occupied.
A permanent loan from the city for the Park Circle project is expected to be up to $5.4 million.
The Main Street lot will have 10 one-bedroom units for middle-income individuals.
The city’s construction loan to the developer for that project is not to exceed $843,000 and a permanent loan of as much as $4.85 million.
The project just off Castle Creek Road is the largest with 24 rental units, including 18 one-bedroom units and six two-bedroom apartments that will be available for individuals who qualify for low- to middle-income categories.
Council approved on first reading the purchase of up to $8 million in revenue bonds issued by the Colorado Housing and Finance Authority for the Castle Creek project.
The proceeds of those bonds will be used to provide a construction loan to the developer and will be repaid when the complex is occupied by tenants.
A permanent loan to the developer by the city is estimated to be up to $5.95 million.
The city land banked the three properties between 2007 and 2009 for the eventual development of affordable housing.
Construction on the three projects is expected to begin in early 2019 and the complexes should be ready for occupancy by the middle of 2020.
With many lingering questions still surrounding the fate of Aspen’s historic Old Powerhouse, City Council decided during Monday’s work session to hold off on providing staff direction on moving the preservation project forward until more information can be presented.