By Meghan Hall
Developers in the San Francisco Bay Area are increasingly looking for ways to make their projects pencil, which has meant producing smaller units — and charging more for them — as labor and construction costs continue to soar. While there are a variety of initiatives in place to help low-income families obtain housing in the Bay Area, much less has been done to help the missing middle: those, often families, who earn too much to qualify for tax credits but do not make enough to afford housing in the region’s competitive market. For non-profit housing developer Mid-Pen, who has received thousands of applications for its five affordable housing developments in the City of San Mateo, it was paramount that its newest collaboration with the City to produce affordable housing provided for those at all income levels. After a competitive Request for Proposals (RFP) process, Foster City, Calif.-based MidPen Housing submitted a pre-application to construct 164-units of affordable housing and an above-ground parking garage on city property at 480 E. 4th Ave. and 400 E. 5th Ave.
“Our non-profit is responding to a great need, and it’s very easy to quantify that need in the City of San Mateo,” explained Nevada Merriman, director of housing development at MidPen. “This is an ideal opportunity, because there’s public land, and the site is in the middle of their downtown, which is a wonderful place with lots of amenities. It also has a lot of opportunities for jobs and high-quality transit. It will produce housing in the right place.”
The parking garage for the project would include 164 private, residential spots and 541 parking stalls. A 2,000 square foot community-serving space and long-term bicycle storage for 196 bikes are also included in the plans. As for the units, according to Merriman, there will be a healthy mix of those designed for a variety of needs. The project plans indicate that nine studios, 70 one-bedroom, 46 two-bedroom and 39 three-bedroom units will be part of the development.
“This is an opportunity to do more and serve a wider range of families,” said Merriman, as she explained the reasoning behind the project’s diverse housing types. “Typically, we have focused on the low-income community. This will be low-income, but also a moderate-income community, which means it will be housing for the workforce.”
MidPen has developed five other affordable housing communities with the City of San Mateo, and it still maintains ownership of three — Delaware Pacific, Peninsula Station and St. Matthew Apartments — all of which have closed waiting lists, according to the company’s website. Merriman said that for Delaware Pacific and Peninsula Station, there are over 600 families currently on the communities’ waitlists. When the developments opened, Merriman estimated that MidPen received around two thousand applications for the units. The amount of demand for affordable housing, especially from families, prompted MidPen and the City to provide units that catered to a wider variety of resident. At 164-units, this will be MidPen’s largest undertaking in San Mateo yet; while Delaware Pacific totaled 120 units, MidPen was responsible for the construction of only around 60 of its units.
“Right now, if you look up and down the Peninsula, the market is producing smaller and smaller homes, and that means that some working families are getting shut out of these communities,” said Merriman. “If you use land to build what the market itself is going to provide, one- and two-bedrooms at market rate, where is the public benefit?”
The City — and the community — backed MidPen’s proposal, said Merriman, and convinced City officials that diversifying the community’s offerings was an important opportunity to better provide for San Mateo.
“By our own experience, we could show the City exactly the kind of work we should do, because the market wasn’t going to do that,” Merriman added. “It is my professional opinion that public land should be used for maximum public benefit.”
Given that MidPen only recently submitted a pre-application for the project in December 2018, it will be some time before the project breaks ground. The project will undergo environmental and architectural review for the rest of the year, Merriman said, with entitlements expected by the end of summer of 2020. The project will break ground a year after that, as MidPen will refine the design of the project while going through the permitting process and locking in its financing.
The project is estimated to cost around $110 million, with part of the funds for the project coming from the City and Measure K dollars. MidPen has already been awarded $1 million from the San Mateo County Department of Housing’s Affordable Housing Fund, according to Merriman. MidPen will also use more conventional funding mechanisms to fund the project. Merriman said that MidPen, however, is excited for the development to come to fruition and its continuing relationship with the City of San Mateo.
“The need is really overwhelming here,” said Merriman. “But the City of San Mateo has done a lot of groundwork to make these types of communities possible. They put things in place in every part of the staff to be able to advance this type of work, and it shows a commitment to their own residents, which I think is really noteworthy.”
