Wednesday, November 13, 2013

No Middle Income Housing Without Subsidies

At a NAIOP breakfast meeting this morning, a panel looked at the housing boom in Boston.  The market is strong there particularly at the high end.  With the recent City Council race done here in Cambridge, it's time to look very seriously at a campaign promise that all candidates made (including myself) to create more middle income housing.

According to Steve Faber of the real estate development firm Related Beal at today's NAIOP panel, there is no way to build middle income housing in high rise construction in Boston without some subsidy.  I'm going to wager that what is true in Boston is also true here in the People's Republic.  So where is the subsidy going to come from?

It can come either as cash in some form, or it can be a subsidy from other market rate units, or it can come in the form of helping on the land costs.  This last option is particularly interesting because Cambridge owns some land in Central Square.  The parking lots that sit off of Massachusetts Avenue are the city's.  It is my belief that the city should hold onto this land, and use it in the same way that MIT uses land -- long-term leases for tenants who can build on it.  That way, the city doesn't relinquish the land, which would be near impossible to buy back once it was gone, and it can generate money for the city.  Additionally, it will allow the city to pursue policy goals it seeks to outline, such as this middle income housing.

Of course, these are all for the next Council to deliberate.  Had I been there, this is what I would be advocating for.  I wish them well in their work.