This, despite the fact that only 10% of the proposed housing might be ‘attainable’.
By Johannes Werner
Original Air Date: August 9, 2024
Host: Benderson Development’s proposal to convert the Siesta Crossings mall into a mixed-use project easily cleared a major hurdle before the Sarasota City Commission on Thursday, with only minor pushback regarding the small number of attainable apartments Benderson proposes. Our news team has the details.
Johannes Werner: In these days of flooding neighborhoods, a convincing argument the redeveloper of the 65-year old mall south of downtown put before the commissioners is this: The updated property will include water retention tanks underneath parking structures, bringing it up to snuff with the challenges of climate change.
But the developer also seemed to suggest that the private sector is unable to end this area’s affordable housing crisis. More than 10 percent attainable units is financially not feasible, Todd Matthis with Benderson Development told the commissioners. All the units will be rentals. Benderson will farm out the residential part to a housing developer, and current interest rates and construction prices don’t allow for more affordability, he argued. Matthis didn’t explain what kind of profit margin Benderson or the housing developers build into in their calculation.
Todd Matthis: But just to understand the reason for the number, six acres here, a block of housing, or six acres there, a block of housing … In order to ensure that housing is going to be built there and be part of the ingredients that make this a vibrant mixed use place, we need the folks who participate in developing housing and the markets to be wanting and willing to build housing here and to get the returns and meet the expectations that they could elsewhere. And so if you think about the area generally … If I’m the developer of the housing, am I going to go to Glengarry Shops if it’s available, or am I going to go here? Well, we were trying to propose something that puts the property in a roughly level playing field from a market expectation standpoint.
And so while we are proposing 10% of the total, when you look at — to your point, 15% of the bonus is about 11% of the total, we’re within a couple units, at that point. So we’re shaving margins. And I don’t know, I can’t tell you whether that’s, that’s a number that will work in the future or whether it will work today. I mean, there’s a lot of interesting calculators out there and things, but what I can tell you is, from a policy standpoint, I think we put the property on a relatively level playing field with, with other similarly situated properties. The unique burden that we’re taking on here, which is, it will yield great results over time, is that when we initially start redeveloping this property, there’s a lot to it. It’s a big property. We’ve had to assemble the ownership. There’s a lot of infrastructure. There’s a lot of upfront costs. And so we’re going to bear a lot of those upfront costs very early. So to me, 10–11%. I don’t, I don’t think the magic is there one way or another. I think it’s more about timing. It’s about how can we get this property started without bearing the costs associated with those early units. And so I think the timing question has been a good one to have. It probably lends itself more toward a likely realization of those units if, if the timing works, then the difference between 10% or 11%.
JW: The city commission session on Thursday had been postponed from a tropical storm-soaked Monday. Only two neighbors showed up to comment on the proposed project. Both expressed their support. That in turn prompted City Manager Marlon Brown to express his delight about the absence of resistance from neighbors. No rebuttal was needed. Benderson consultant Philip DiMaria:
Philip DiMaria: Thank you, Mayor, for your time. And once again, I did want to reiterate, I appreciate the city manager mentioning how refreshing it was to hear the support from the community. Todd and I spent a lot of time. We hope that reflects the time that we did spend with the community. We had four community meetings, a lot of follow up conversations. I’m trying to right size this project. And that’s in the proposal before you today.
JW: Commissioner Jen Ahearn-Koch tried to squeeze a few more attainable units out of the developer. She also asked for more attainable units upfront, as the developer is proposing to start with a smaller share of attainable units in Phase 1 and ramp up their number in Phase 2 and 3. Both Ahearn-Koch and Commissioner Debbie Trice said they would prefer 20% of the units were attainable or affordable. But both eventually yielded and voted for the proposal, with minor clarifications, to be moved to review by state agencies. A final vote will happen when, as expected, the state approves the project.
Affordable-housing advocates argue that 10% affordability of new projects barely keeps the current housing deficit levels where they are, as the wealthy folks moving into the other 90% push up demand for low-salary service workers.
Reporting from Sarasota, this is Johannes Werner with WSLR News.
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