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Santa Monica, California: The Arroyo Provides Affordable and Sustainable Housing
The city of Santa Monica has not escaped California’s affordable housing crisis; more than half of the city’s households spend more than 30 percent of their income on rent. The city also faces the enormous challenge of meeting the need identified in the 2021 regional housing needs allocation (RHNA): planning for an average of 1,109 new housing units annually for the next 8 years, more than two-thirds of which must be affordable. This year’s allocation represents a fivefold increase over the city’s target in the previous RHNA cycle. To meet this goal, the city has adopted aggressive measures to encourage the development of affordable housing units, such as its inclusionary housing (IH) regulations. At the same time, this Los Angeles County municipality is facing a climate crisis as the area experiences higher average temperatures and longer-lasting droughts. The city addresses climate change in its 2019 Climate Action and Adaptation Plan, which includes strategies to make buildings carbon neutral. Several recent housing projects developed in the city were designed to be both sustainable and affordable. One such project is the 64-unit Arroyo, which was developed by Community Corporation of Santa Monica. Completed in 2019, the Arroyo received Leadership in Energy and Environmental Design (LEED) Platinum certification from the U.S. Green Building Council.
Four Levels of Affordability
The Arroyo is a five-story building consisting of two parallel wings connected at both ends by bridges on each floor. A courtyard is centered between the two wings. In addition to a unit for the property manager, which is affordable at an income of 80 percent of the area median income (AMI), 63 units are reserved for residents earning less than 60 percent of AMI. Of these, 7 units are affordable to households earning up to 30 percent of AMI, 13 are reserved for those earning no more than 40 percent of AMI, 26 for those earning no more than 50 percent of AMI, and 17 for those earning no more than 60 percent of AMI. Twenty-nine of the apartments have one bedroom, and families can comfortably occupy the 18 two-bedroom and 17 three-bedroom units.
Two community rooms host free programs such as fitness classes, financial management courses, and computer training sessions. Younger residents can take advantage of teen programs, afterschool homework assistance, and college readiness courses. The Arroyo’s downtown location is close to shops, restaurants, and attractions. A high school, library, and community center are also nearby, as are parks and the city’s iconic beach and pier.
The Arroyo Development Agreement
The Arroyo resulted from the city’s IH regulations as they applied to 500 Broadway in downtown Santa Monica. Proposed by developer DK Broadway in 2013, the mixed-use development with 250 market-rate apartments was subject to city requirements to either construct affordable units or contribute to the development of affordable housing offsite. In addition, because the seven-story building would exceed the 32-foot maximum height for buildings in the downtown, DK Broadway had to enter into a development agreement with the city. The developer agreed to provide a site to be used for affordable housing a few blocks away from 500 Broadway. DK Broadway transferred this property to Community Corporation and provided additional financial support to construct and operate the Arroyo (table 1). Low-income housing tax credit equity through Bank of America accounted for nearly half of the financing for the $44 million development. The bank also provided a $1.1 million permanent loan. With this financial package, Community Corporation was able to develop the Arroyo without city or state funding.
Table 1: The Arroyo Financing
|Low-income housing tax credits||$24,035,000|
|Developer gap loan||2,503,000|
Santa Monica’s climate plan commits the city to reducing carbon emissions by 80 percent by 2030 and increasing the city’s resilience to the impacts of climate change. The city enforces green building standards and negotiates higher levels of sustainability whenever possible. The development agreement for 500 Broadway required the building to be LEED Platinum certified. Many local developers share the city’s commitment to sustainability and promote these practices even when they are not required to do so. Through such joint efforts, Santa Monica boasts 22 LEED Platinum-certified structures, including the Arroyo and other affordable housing developments.
Tara Barauskas, executive director of Community Corporation, pushed for the Arroyo to attain LEED Platinum certification without compromising affordability, in part because of the city’s requirement for 500 Broadway. Barauskas explains that the Arroyo incorporates a key element of sustainable design: “taking advantage of all of the things that nature provides for free.” The courtyard, bridges, and the open-air corridors in the two wings allow natural airflow through the development, promoting ventilation and cooling without increasing energy demand. Likewise, the building’s photovoltaic cells and solar water heating panels put Southern California’s abundant sunshine to use. At the same time, the Arroyo protects residents from too much sun exposure, with distinctive shades around the building’s windows and a high-albedo roof.
The property’s location also contributes to the Arroyo’s Platinum certification. Residents of the downtown infill project are an easy walk or bike ride away from job opportunities at several hotels and restaurants, schools, medical services, and municipal offices. The Arroyo’s proximity to these amenities and a Metro light rail station makes it possible for many residents to live there without owning a car. Onsite parking for 142 bicycles supports another sustainable transportation alternative. The building hosts several electric vehicle chargers to support Santa Monica's and California's goals to promote electric automobiles. The ability of the Arroyo to incorporate these sustainable features while maintaining a high level of affordability earned the property a 2020 LEED Homes award in the Outstanding Affordable Housing Project category from the U.S. Green Building Council.