Hayden Town Council has approved the rezoning of a 23-acre parcel, paving the way for a 180-unit affordable housing development along U.S. Highway 40 on the west side of town.

Developer Gorman and Co., which built the Yampa Valley Housing Authority’s Sunlight Crossing project in Steamboat Springs, plans to partner with Hayden’s new housing authority for the mixed-use development, which is still in the early planning stages.

“We envision a mixed-income spectrum of affordable housing that’s all deed-restricted,” said Kimball Crangle, Gorman’s Colorado market president. “From the date that we get a funding award, it takes us about three years to open doors. It’s unfortunately not as fast as we wish we could move, but that’s a very typical timeline.”

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The parcel at 1300 W. Jefferson Ave. is on the western edge of Hayden along U.S. 40. While the land was previously zoned for open space, which limits potential land uses to parks or a school, the town’s master plan designates it as a place that’s appropriate for a mixed-use development.

Town Council unanimously approved changing the zoning to commercial on Thursday, Dec. 1, which will allow for commercial businesses along the highway, as well as housing.

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“We have this property under contractor and have been working with our design team to come up with a plan,” Crangle said. “Twenty-three acres is a lot of land, so (we’re) trying to figure out a way that we can utilize the land in a way along Highway 40 for commercial uses, but also bring residential uses to that side of town.”

Hayden Town Manager Mathew Mendisco said the town’s housing needs assessment found Hayden needs around 150 to 250 more housing units over the next five years. That study took into account the need based on businesses within five miles of Hayden.

Gorman did its own study of the housing need in Hayden on a more regional level, which identified a demand for nearly 500 units, Crangle said. That study tried to account for folks who may want to move to Hayden to shorten a commute, those who choose Hayden over Steamboat based on price and growth in Hayden itself.

Mendisco said the project would be done in partnership with the town and Hayden’s Municipal Housing Authority, which Town Council created last summer modeled after Breckenridge’s municipal housing authority. He said the municipal authority allows the town access to more funding streams for affordable housing than Hayden would otherwise be able to find on its own.

Hayden is not part of the Yampa Valley Housing Authority. Unlike YVHA, which collects a one-mill property tax, Hayden’s housing authority does not have a direct funding source.

“Both operationally and financially, it opens up a lot of tools in the tool belt that we probably didn’t have before,” Mendisco said.

Crangle said Gorman plans to apply for a low-income housing tax credit from the Colorado Housing and Finance Authority for the project early in 2023. Similar tax credits have been used to build affordable housing projects in Steamboat.

Also, Hayden Town Council has approved having the town apply for a transformational housing grant from the Colorado Department of Local Affairs, which would be used for planning on the project.

Gorman was the developer for Sunlight Crossing in Steamboat, a 90-unit project that sought to provide middle-income units and leased out earlier this year. Crangle said the company has been working in Colorado since 2014, with projects on the Front Range as well as in Summit and Eagle counties.

“We love the town of Hayden, and so we’ve been looking to try to find a way to help the town add to its housing stock,” Crangle said. “We’re really trying to target housing that’s really good quality for folks that want to live in the communities that they’re working in.”