West End delays
Financing for housing project coming up short
Steamboat Springs — Shawn Zwak is one of the most visible law enforcement officers and firefighters in Steamboat Springs, riding his bike around town tens of miles a day. Pretty soon, though, he may become entirely invisible, like so many others who have been forced to leave the valley because of the high cost of living.
For Zwak and 74 others who have expressed interest in buying into the city’s first income-restricted affordable-housing project including teachers, city workers and skilled artisans the situation isn’t supposed to be like this. The West End Village Project, passed by the Steamboat Springs City Council almost exactly one year ago, was not thought to be the silver bullet solution to the community’s affordable-housing problem, but it was an important start.
Now, after more than two years of planning, $250,000 in city and county subsidies and scores of meetings, the cratered plateau off Downhill Drive in West Steamboat is still just a cratered plateau.
Zwak, who had to sign another one-year lease when the project didn’t come together this spring, says he doesn’t have much more time to wait.
“It would be a big turning point,” Zwak said. “If this doesn’t work out for us, it’s kind of a deciding factor as to whether we stay in Steamboat. We don’t want to stay here and be renters forever.”
Others who had initially had their names on the interested parties list have already been forced to leave Steamboat. Matt and Chris Mraz, who own a mobile home in the downtown Trailer Haven trailer park, which is scheduled for demolition next June, have moved to Oak Creek even though they had initially expected to get a good deal on a new home in West End Village.
Others in Trailer Haven are still holding out for a spot in the development, but their time is running short.
The land slated for the 137-unit project has not even been bought from the current owners, ACM Investments, which includes Bill Moser of Moser and Associates.
Steve Cavanagh’s investment group had an option on the property but that option expired on Nov. 30. Now, the Regional Affordable Living Foundation and potentially Cavanagh are looking for other ways to purchase the property. Cavanagh would not comment on the deal or whether he has further interest in purchasing the property.
Moser said RALF now has first go at the property, which he himself wants to become affordable housing.
The original idea was for Cavanagh to buy the land and then sell at least half of it to RALF to build deed-restricted affordable housing for people making 120 percent of the area median income or less, while Cavanagh or another developer built smaller market-rate homes. RALF Executive Director Rob Dick would also buy some of the land that is especially hard to develop because it is in an airport influence zone.
But RALF, which has been especially successful at securing financing from such groups as the U.S. Department of Agriculture under Dick’s guidance, is currently having trouble putting together a deal. In a tough economy, few investors have been willing to front the money for a project such as West End Village, Dick said. While RALF was close to securing a loan for 80 percent of the project, the events of Sept. 11 and other economic factors put that dream to rest, Dick said.
“We believed we had financing lined up prior to Sept. 11,” Dick said. “After Sept. 11, people’s commitments have weakened.”
Now Dick’s best financers are only willing to front him 70 percent of the cost of the $3.8 million project and, despite some private and governmental assistance to help with the initial payment, that won’t cut it.
“The problem we are facing is that we are essentially relying on a real estate market from two years ago,” Dick said.
Estimated lot prices are still going up, with a contractor’s most recent guess reaching $45,000 per lot for infrastructure costs and land purchase costs, Dick said. What may have been affordable last year has grown less and less so.
In the meantime, some people who had counted on this project to get into the housing market have had to look for other options, or, Dick thinks, already left town.
RALF’s Ellen Hoj spent the past week calling the 75 people who had initially expressed interest in the project to make sure they were still interested. Many said they still wanted to be on the list, but at least nine who returned her call wanted off, Hoj said. Of those, most had found other living arrangements, such as a house or condo they had been able to purchase, she said. And just about everyone was perplexed as to why the project was taking so long, she said.
Former City Councilman Jim Engelken, who is also on the RALF board, said he thinks the city or the taxpayers may need to ante up some more money so projects such as West End Village can get completed in a timely manner.
“The private sector isn’t going to be interested because there’s limited profit involved,” Engelken said. “We don’t have enough money to make this deal happen.”
To reach Avi Salzman call 871-4203
or e-mail firstname.lastname@example.org
Support Local Journalism
Support Local Journalism
Each donation will be used exclusively for the development and creation of increased news coverage.
If you don't follow the rules, your comment may be deleted.
User Legend: Moderator Trusted User