Asheville's first micro-housing development headed to South Slope

2022-06-16 09:49:22 By : Mr. Jery Huai

ASHEVILLE - A city subsidized micro-housing development is coming to South Slope despite concerns from some council members that the 80-unit building will be a detriment to the historically Black neighborhoods that surround it. 

“It feels like all of this development is moving in on this community that is desperate for some type of relief, and we’re not giving them any by continuing to approve development like this," said Vice Mayor Sheneika Smith at a June 14 City Council meeting. 

Sixteen units, or 20%, will be deeded affordable for 20 years, which Smith said is not enough to offset the gentrification and displacement occurring in the Southside community. 

The tiny apartment development is slated for a 0.18-acre vacant lot at 217 Hilliard Ave., next to the now-closed Hot Spot at the corner of Hilliard and Asheland avenues. 

It's an area flush with plans for new development — such as the 230 apartments proposed across the street and the 187-unit Avery approved by council in March.

Smith asked staff how the new development would impact Black homeowners, already hit hard by a recent tax appraisal, and wondered if the units would impact property taxes. 

"It is very close to Black homeowners that are struggling,” Smith said, noting that Southside was disproportionately impacted by the 2021 tax appraisal. 

A recent report found that home prices in the Southside neighborhood — defined as land between Patton Avenue and Meadow Road, north to south, and between the French Broad River and Biltmore Avenue, west to east — went up 116% between 2016-2021, the highest in Buncombe County, and prompted the formation of an ad hoc committee to review whether appraisals were performed equitably.

More development in the area: 

Sasha Vrtunski, Asheville's new Affordable Housing Officer, formerly an urban planner with the city, said while she doesn't have a statistical analysis to say exactly how much nearby property owners will be affected, she can generally say there will be an impact.

Southside has become a "desirable location," she said, and as property taxes continue to rise, it "disproportionally effects people of color, for sure."

The affordable housing officer is a new position, part of the Community and Economic Development department's efforts to better meet affordable housing needs in the city. 

Council member Antanette Mosley, speaking remotely, echoed Smith's sentiment, and said she shared concerns about the location of the development — fearing not just gentrification, but that the people that live in the neighborhood are not those that would be able to move in. 

The project itself does not require Asheville City Council approval, but went before council members for the city's Land Use Incentive Grant, a city property tax abatement program in exchange for affordable housing. 

Council voted June 14 to approve a $592,790 city subsidy over 21 years. The motion passed 5-2, with Smith and Mosley opposing. 

Council member Kim Roney also voiced some concerns, but said she would vote 'yes' to support the measure of relief the development could offer to the people living in its eight units that will accept housing vouchers and the project's proximity to public transportation.

Other council members, including Sage Turner, said the units were "leaning into affordability already," and was thankful to see an Asheville developer experimenting with a different model of housing. 

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If someone were to walk by the lot where the development is proposed, Vrtunski said, they would be "kind of amazed that this much building would fit on such a small piece of land." 

The project is the city's first micro-housing development. All units are between 180-250 square feet, roughly the same size as a double dorm room at UNC Asheville. 

According to project plans, there is a kitchen, lounge and laundry facility for shared use on every floor. Each unit has a private bathroom and a half-kitchen, with a sink and an area for a microwave or other small appliances. There is also a rooftop deck planned for the building. 

David Moritz, a managing partner with developer Mori Blue Holdings LLC, said the development would bring desperately needed workforce housing to the area, meeting  what he said was one of the biggest issues in Asheville right now: reasonably priced housing. 

Moritz said the units, which are outfitted with a double bed, can house two people.

"First of all, this is our genuine best attempt to bring reasonably priced housing to downtown Asheville. I currently don’t see anybody else doing that," Moritz told City Council June 14. “At least actively doing it, rather than talking about it.” 

Though micro-housing has not been utilized before in Asheville, he said his business partner, Scott Shapiro with Eagle Rock Ventures, has implemented this model in cities nationwide. The closest example is the 150-unit micro-apartment Martin Flats development in Nashville. 

Already 100% occupied, Mortiz said it meets a demand, and tends to target the local workforce, with resident ages trending toward their late 20s. 

Apartments in Nashville's Martin Flats, which opened in October 2021, were priced around $1,000 a month with utilities and Wi-Fi included. 

It's the same ballpark price as the Asheville units, though Moritz said this is subject to change given inflation and construction costs. 

The nearest studio apartments on Patton Avenue, said Moritz, run about $1,800 a month, and they intend for these units to be more "reasonably priced" than competing units. 

“A lot of people will be able to benefit from that," said council member Sandra Kilgore, even if they aren't qualifying for the units deeded affordable at 80% area median income.

For a one-person household, 80% AMI is $42,100 or $48,100 for a two-person household. Asheville's affordability rates for studio or efficiency apartments is set at $884 without utilities and $1,053 with utilities included. 

Moritz said while the 16 units are obligated to meet the city's definition of affordability, the remaining units will be rented at market rates.

At the public hearing, Nina Tovish was the only speaker. Tovish is one of the six candidates in the running for Asheville City Council.

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“With only eight units eligible for housing vouchers, let’s be clear these minimalistic units are not going to make a dent in the need for affordable housing for Asheville’s residents who work in the city’s service economy," Tovish said, calling the apartments "glorified dorm rooms."

“I would like to think that the city might find better ways to leverage the nearly $600,000 of foregone tax revenue. But if you are going to do it, at the very least, the number of units set aside as affordable should be larger, the percentage AMI should be lower, they should all accept housing vouchers and the period of affordability should be longer.” 

Smith said she does not want to discourage developers from coming to the table, but wanted developments proposed to the city to consider the landscape around them. 

"Moving forward, location does matter," she said. "We do have a couple of census tracts that are desperate for affordable housing, so just giving that community a swath of affordable housing, or just a measure of housing choice vouchers, is not sufficient. It’s not enough, it’s not going to meet the community need."

Mayor Esther Manheimer asked Moritz if he wanted to return to council in two weeks with new numbers, or a consideration of less affordable units at a deeper affordability rate. 

"The short answer is, 'no,'" said Moritz.

Having worked on the project for over a year, he said this is what they were able to offer.

"It is a compromise doing micro-apartments, but from my business partner, he's done 10 of these throughout the United States, and most of them are 100% leased. There is clearly a demand for them, people like them, they want to live there," he said. 

"I think this is a great project, it's a great location." 

Regarding comments about area property taxes, Moritz said he also hoped that development would not occur at the detriment of current residents, but that issue would need to be addressed by the city or county by locking in tax rates, or something similar.

"We’re just trying to bring housing for workforce in downtown Asheville which is really desperately needed,” he said. 

The project will break ground this summer and construction will last 12 to 18 months, with completion slated for 2023. 

Sarah Honosky is the city government reporter for the Asheville Citizen Times, part of the USA TODAY Network. News Tips? Email shonosky@citizentimes.com or message on Twitter at @slhonosky.