HomeMy WebLinkAbout3/5/2024 Item 8a, Mavis
Wilbanks, Megan
From:Damien Mavis <dmavis@covelop.net>
Sent:Tuesday, March 5, 2024 1:50 PM
To:E-mail Council Website
Subject:Comment on 8a
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Greetings City Council—
I would like to comment on tonights agenda item 8a. I first would like to commend the city on becoming a Pro-Housing
city. A lot of work went into facilitate housing which is sorely needed in this community. City staff and elected officials
should be proud of that accomplishment. There are three items which I think would help the city provide more of the
right type of housing:
Support Missing Middle Housing— As a for profit builder/developer we are really only suited to address the “Market
Rate Rental” and Market Rate Home Ownership” part of the Housing Continuum. I think it is important to support and
incentivize the portions of these two categories which do the most good. I see that as Missing Middle housing (MMH) as
opposed to more single family residential (SFR). This is because MMH fills in the gap which exists in affordability that is
between the top end of deed restricted homes to the high end of the market which is SFR. As a developer I understand
that the easiest and most profitable type of housing to design and develop is SFR, which is proven out by it being the
majority of the development which has taken place in the city over the last few decades. If the Housing Continuum is a
ladder then unless we incentivize MMH on a large scale we are eliminating several rungs. To illustrate this point I
looked at brand new homes in SLO city housing tracts. These are on the market right now. For a 3 bedroom home that
is deed restricted to the “Moderate” level it has to sell for a maximum of $493,950, which is based on a buyer qualifying
at 120% of the AMI, unfortunately at this price it has to be subsidized and does not make it natural into market rate
housing. The average new 3 bedroom home in SLO (older ones are not much cheaper by the way) sells for $968,000 this
represents 225% of AMI. So between deed restricted at 120% AMI and market rate for a SFR which requires 225% AMI
there is a huge gap. That gap can be filled with MMH. The cheapest new market rate 3 bedroom flat condo is $585,000
(it is the smallest 3 bedroom in the group) which represents 135% of AMI, which might be considered the first rung of
MMH. The next rung is a market rate 3 bedroom townhouse at $775,000 which represents 180% of AMI. Both of these
MMH examples fit right between the 120% AMI deed restricted units and the 225% AMI SFR. This is where we see the
biggest need and where Covelop is focusing its efforts. To help incentivize filling this gap I would propose bringing
Table 2A of the housing element back in a modified form. When the IHO was updated this table which rewarded
affordable by design and smaller units, was eliminated. This was the only incentive that for profit developers had to
develop smaller units and MMH. I agree that Table 2A went too far and perhaps it could be retooled to support MMH
housing types and more modest attached homes. Maybe it would not eliminate the inclusionary requirements but
just reduce it to incentivize this important type of housing.
Eliminate or greatly reduce parking requirements for downtown housing— “No great city has ever been known for its
abundant supply of parking.” Allan Jacobs. I agree with this quote and it has become a very expensive part of supplying
downtown housing. A parking in lieu fee is almost $30,000 per space. If maybe even just smaller units could be
exempt from the parking in lieu fee requirement I think we’d see more housing downtown. Honestly I don't think the
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city should want a developer to build parking in an urban setting. It disrupts the rhythm of the building facades, is very
inefficient and is a waste of prime commercial space. I certainly understand that is the reason there is an in lieu fee, but
it has just gotten so expensive and burdensome. It becomes a very significant part of the overall building costs, which
stifles residential projects.
Review our current CEQA procedures— Unfortunately CEQA abuse has become rampant. I cannot emphasize enough
how destabilizing it is and what an impediment to all types of development it has become. There are thousands of
homes which are not being built today because of frivolous CEQA lawsuits in this state. Reviewing, streamlining and
updating procedures to address this would help developers deliver the housing this community desperately needs.
I would like to thank city staff and elected officials for caring enough about housing that such a significant effort is put
towards this important issue.
Sincerely,
Damien Mavis
dmavis@covelop.net
Bus: 805.781.3133 Cell: 805.748.5546
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