Grand Lake to chip in for workforce condos
As part of the Portal Crossing development in Grand Lake, six units may be listed at an attainable price and dedicated to workforce housing, so long as they sell within nine months on the market.
On Monday, Grand Lake trustees negotiated with developer Jim Kreutzer to subsidize the cost of constructing new one-bedroom condos to be sold at 110% Area Median Income rates, or around $310,000. Town code required two workforce units at the development, but Kreutzer is planning for six, which prompted him to ask the town for support.
Ultimately, the board approved a final development plan for Portal Crossing with a number of conditions for both the developer and the board.
Discussions began with the revelation that the one-bedroom units Kreutzer proposed were technically too small to meet the town’s Local Employee Residence Program (LERP) guidelines for deed restricted units.
According to the program, one-bedroom units are supposed to be a minimum of 750 square feet, while studios are a minimum of 500 square feet. Kreutzer’s units range from 587 to 647 square feet.
Kreutzer was adamant that the units be accepted at the size he presented because town code allowed for a minimum of 400 square foot units at market-rate. He also noted that the project wouldn’t be feasible if the units were classified as studios because of the lower sale cost.
Studios selling at 110% AMI are priced at $280,460, per the 2021 Colorado Housing and Finance Authority.
“It’s impossible to sell those units as what is recommended in that graph for what it costs to build today,” Kreutzer said. “The square footage of the units is fine. We’re selling stuff at 500, 600, 700 square feet one-bedrooms and studios and they’ve sold and people are completely happy with it.”
Trustee Michael Arnston agreed that smaller units were acceptable and indicated the code should change to reflect that.
“(The LERP) hasn’t been updated in at least 10 years and as Jim stated, since 2011, there has been an open push for smaller spaces,” Arnston said. “A 600 square feet one-bedroom I’m sure is larger than the two-bedrooms we have on top of the fire department.”
Other trustees agreed, meaning a change to the LERP is likely coming soon to reflect the decision.
Grand Lake’s LERP also requires the attainable units to be deed restricted to county workforce into perpetuity. The exact details of the deed restrictions have not yet been worked out.
Kreutzer agreed to the requirement under the condition that if the four nonrequired units don’t sell within nine months of receiving the certificate of occupancy, then they can be listed at market rate.
Kreutzer told the board this caveat is to ensure he doesn’t end up with units he can’t sell.
“If interest rates are going up, which they are, it makes the price go down on the unit,” he said. “If they don’t sell, I can’t afford to pay $2 million on interest in housing that’s sitting empty, so I should be able to go out and sell those to get my money back.”
Trustees were willing to allow the nine month timeline.
Finally, Kreutzer asked the town to waive several fees, including tap fees, permit fees, water fees and the 7% open space fee, as well as credit for sewer fees on all six workforce units. He estimated the total amount of fees to be waived around $80,000 and a sewer credit at roughly $57,000.
“I think everything I’m asking for is reasonable,” Kreutzer said.
While trustees were willing to help with some of the fees, they seemed hesitant to cover everything that Kreutzer requested. Instead, the final development plan for Portal Crossing included a condition that the town negotiate fee waivers and credits before building permits are issued.
In other business:
• Trustees approved an updated fee and rental schedule for town facilities and services.
• A final report from the Lands Committee, which identified and prioritized several public land projects in Grand Lake, was approved.
• Trustees negotiated with another developer for 21 potential workforce housing units in an executive session for several hours.
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