HOUSTON – (Realty News Report) – Construction is now underway on Heritage Senior Residences, a new senior living community taking shape in the Washington Avenue corridor, one of Houston’s most active apartment markets.
The 135-unit mixed-income development is a partnership between the City of Houston’s Housing and Community Development Department and an affiliate of Atlantic Pacific Communities, a Florida-based multifamily firm managing tens of thousands of rental homes.
Heritage Senior Residences received federal support through Community Development Block Grant – Disaster Recovery (CDBG-DR) funds, with an award of $14.35 million. These funds were made available in response to Hurricane Harvey, which in August 2017 brought historic flooding to the Houston region and destroyed thousands of homes, businesses and community facilities.
The project is designed to help Houston’s senior population recover from the long-term impacts of the storm and to address rising housing costs that make it difficult for older residents to remain in established neighborhoods.
“Heritage Senior Residences is an important addition to this area of our District, which hasn’t seen a similar project in decades. Housing prices and rents continue to rise in Houston, making it harder for our seniors to live in high-quality, affordable housing. Atlantic Pacific has been a terrific partner in tackling this issue, bringing a better quality of life not only to our seniors, but to the surrounding neighborhoods,” said City of Houston Council Member Abbie Kamin of District C.
Houston Home Prices Hit Record Highs
Houston’s housing market has been strong: in May, the average single-family home price reached $387,105, a near-term record and a roughly 30 percent increase year-over-year, according to the Houston Association of Realtors. While multifamily rents softened during the pandemic, they surged again this spring as demand and occupancy recovered.
Heritage Senior Residences will be located at 1120 Moy Street, about one block north of Washington Avenue and roughly ten blocks east of the Westcott traffic circle. The Washington Avenue/Heights corridor has seen numerous new multifamily developments completed recently and more under construction, and that submarket ranked at the top of the region for apartment absorption in a recent industry report.
More Facts About the Neighborhood
Census Bureau data indicate that in the 77007 ZIP code area around Heritage Senior Residences approximately 64 percent of senior households are rent burdened, meaning they spend more than 30 percent of their income on housing costs. This statistic highlights the need for affordable senior housing options close to services and community networks.
Expected to be completed in late 2022, Heritage Senior Residences will offer a mix of market-rate and affordable apartments: 30 percent of units will be market rate and 70 percent will be income-restricted. Market rents are projected to range from about $1,304 for one-bedroom units to $1,624 for two-bedrooms. Affordable rents will be scaled by income and are estimated to run from approximately $445 to $1,189 for one-bedroom units and $534 to $1,426 for two-bedroom units.
“Heritage Senior Residences is a prime example of how successful public-private partnerships enhance communities and improve lives,” said Dan Wilson, Senior Vice President at AP Communities. “We are honored to work hand in hand with the City of Houston to bring a valuable new asset to the Washington corridor that provides local seniors a high-quality home with a wide array of amenities in the neighborhood they love at a price they can comfortably afford.”
“Heritage Senior Residences will help ensure that seniors in the Memorial and Rice Military area can remain in a community that is near services and still affordable,” said Ray Miller, Assistant Director of Multifamily at the Houston Housing and Community Development Department. “For many seniors, it becomes difficult after retirement to find adequate homes in the communities they have been rooted in all their lives — especially for working-class and middle-class seniors.”
The Financial Stack
The project’s financing package pairs the City of Houston’s $14.35 million in CDBG-DR funds with $13,796,806 of equity from the sale of housing tax credits, a $20.5 million construction loan from Bank of America, and a $9.8 million permanent loan from Citi Community Capital. This combination of public and private capital enabled the project to move forward and address an urgent community need.
“We continue to realize the effects of Hurricane Harvey on housing, and we understand that, for older adults especially, access to consistent housing is a public health concern. Addressing housing insecurity in our older population means providing mental and physical stability as well as the ability to age in place,” said Hong Ogle, President at Bank of America Houston. “Our partnership with Heritage Senior Residences reinforces Bank of America’s commitment to invest in opportunities that help mitigate housing insecurity in our community.”
June 22, 2021 Realty News Report Copyright 2021
For readers interested in Texas real estate, the book Houston 2020: America’s Boom Town — An Extreme Close Up by Ralph Bivins explores regional market trends and developments.
Image: Rendering Courtesy AP Communities
File: Houston’s Hottest Apartment Submarket
File (2): Community Development Block Grant; Washington Avenue/Heights submarket; Atlantic Pacific; HUD; Houston Association of Realtors; Hong Ogle.