Located just off the Topanga Canyon exit on the 101 Expressway, this is a prime example of modern, luxurious apartment life.
Built in 2020, Clarendon Apartments in Woodland Hills feature a poolside cabana, a fire pit terrace, and 24-hour community rooms with kitchens and billiard tables. The apartment itself is spacious. On average, a two-bedroom unit costs 1,000 square feet, which costs over $3,000 a month.
Now, the important part of that is about to change.
In December, the 335-unit complex was acquired by the Los Angeles City Housing Authority. The city of Los Angeles is in the process of converting it into mixed-income property while maintaining its luxurious amenities.
Authorities using a unique form of funding view the acquisition as a model to expand their affordable housing portfolio.
A community room located at Clarendon Apartment in Woodland Hills.
“It’s really important to create housing opportunities and open up stable access to neighborhoods,” said Lourdes Castro Ramirez, chief executive of the housing authority.
Under Clarendon’s plan, about a third of units will be reserved for low-income households. The rest is reserved for middle-income households, accounting for up to 150% of the median income.
Rent varies based on income, but for a minimum of three households in low-income branches, the cost of a two-bedroom is $936 a month.
Some middle-income units do not differ significantly from market rates, but housing authorities say the overall average rent is expected to be 32% lower than those under the old owners.
The local Housing Authority owns traditional public housing complexes such as Watt’s Nickerson Garden and is best known for administering the federal Section 8 voucher program, which subsidizes rent paid by low-income people on private property.
What’s less well known is that the authorities own around 150 other rental properties, with a mix of market rates and affordable units, mainly purchased in the 1980s. However, last year, housing authorities secured $30 million to step up their acquisitions.
1
2
3
1. A two-bedroom unit located at Clarendon Apartment in Woodland Hills. 2. Two bedroom unit at Clarendon Apartment. 3. A one-bedroom unit located at Clarendon Apartment in Woodland Hills.
The first major property acquired using these funds was the $156 million Clarendon Apartment. The agency has put $12.5 million in stock from a $30 million fund and issued non-exempt bonds sold to private investors to cover most of the others.
Clarendon’s funding also included a $5 million low-interest loan from LA4LA, a new organization defended by Mayor Karen Bass, who uses charity to fund affordable housing.
In total, about 11% of the funds to acquire Clarendon came directly from the government and charity.
Bond Investors, Housing Authorities, Charity Funds – All parties expect to at least gain a return on investment.
Sarah Dussey, LA4LA’s chief strategist, said that by leveraging investments from nonprofits and private sectors, the Clarendon model will provide an opportunity to significantly improve the affordability crisis when the government’s dollars can be further advanced. Not only can the model support acquisitions, but it also argued that governments today’s governments could use it to build affordable housing cheaper and faster, as there are fewer funding hurdles in the bond market compared to heavy financial processes.
“We can actually make capital available at the scale we need,” says Dusseault.
Before housing authorities could buy it, Clarendon set aside 8% of the units for low-income families, but the agency has significantly expanded the number available and has placed rent restrictions on all units. The annual rent increase for tenants also reaches 4%.
Nevertheless, housing authorities expect to make around $1 million a year in the first few years. According to agency reports, there is money that can be used to provide more services for your tenant or to obtain additional units.
One reason Clarendon is still expected to generate income is that, as a government agency, housing authorities do not have to pay property taxes.
1
2
3
1. The pool area of Clarendon Apartment in Woodland Hills. 2. WiFi room in Clarendon’s apartment. 3. Clarendon Apartment’s business centre.
In this way, Clarendon’s acquisition has been similar to a transaction that other cities have completed in recent years. There, they partnered with private real estate companies to acquire real estate and reduced rent.
However, housing authorities said that unlike private companies, agents do not charge fees and have access to certain types of funds from the federal government that only housing agencies do, so that the model could generate more affordable prices than those transactions.
For example, housing authorities receive money from the Housing and Urban Development Authority, which subsidizes rent to many of the tenants of property that earn very little or very low incomes.
Overall, there are 24 units for households that make up less than 30% of the median income, and 42 more for those who make up less than 50% of the median income.
Housing authorities hope that Clarendon is looking for ways to find more money for the acquisition, not just one-time.
The fitness centre at Clarendon Apartment.
At this time, all tenants were left from their previous owners and said they could stay as long as they wanted. Once they move, they are replaced by low- and middle-income residents who pay rent, which are deemed affordable, based on their income.
Of Clarendon’s 335 units, the majority are one and two bedrooms, and housing authorities say it is most in demand for low-income households.
Unlike most buildings where low-income families live, the tenants have all the bells and whistles: new appliances, a “smart” HVAC system, a community business center, and poolside cabanas under palm trees.
“This,” said Castro Ramirez, “a wonderful building.”
Source link
