This article was printed in Minnesota Multi Housing Association’s newsletter.
We’ve heard the statistics about Minnesota’s affordable housing crisis so frequently that we run the risk of becoming immune to them:
In late November 2019, Baker Tilly Municipal Advisors hosted their annual Symposium for members of the public sector, highlighting the topic of affordable housing through a keynote address by Alan Arthur, President and Chief Executive Officer of Aeon, a not-for-profit developer focused on affordable housing solutions and subsequent breakout sessions comprised of affordable housing practitioners. After hearing the statistics, the case studies and the talk of possible solutions, I left the Symposium with three important takeaways.
“We ain’t seen nothing yet”
Alan Arthur sounded the alarm bells in his keynote speech. An almost 50-year veteran of the affordable housing and real estate industry, Arthur shared his belief that over the next two decades we will see the worst housing crisis for lower income people since the Great Depression. Furthermore, he expressed the belief that homelessness will double during this time period. Arthur quipped, “Even if I’m wrong by half, homelessness will still increase by 25 percent.”
He noted the window to keep NOAH (Naturally Occurring Affordable Housing) properties affordable is closing. In places like Seattle and Portland, that window has already closed. The Twin Cities is losing 75-100 apartment units per week as these market-priced properties are acquired and renovated by private developers causing rents to increase to a level that is no longer affordable. The result? Resident evictions and displaced residents, which contribute to the homeless numbers Arthur has predicted.
“So what’s ‘the’ solution?”
There is no singular silver bullet to address the affordable housing crisis. As noted in the 2018 “Report of the Governor’s Task Force on Housing,” a myriad of solutions must be employed to address the problem and reverse the trends. These solutions involve state, local and the federal government, hospital systems, not-for-profits, the real estate community, the educational system, large employers (particularly in small to mid-sized communities) and the private sector.
At the Symposium, a number of different ideas were shared which, when working together, can have a positive impact:
The message that resounded most with me was a positive one – communities have the power to make a difference in the affordable housing crisis. Creative ideas, committed individuals and assistance (where needed) from federal and state governments can all help address the issue.
Panelists shared case studies and ideas of communities working together with developers, not-for-profits, corporations and others to increase affordable housing units in their community.
Bethesda Homes did more than build apartments for people with intellectual and developmental disabilities – they created Cornerstone Village (opening late summer 2020), a community where these individuals can live and thrive. Cornerstone Village will be an independent housing community that integrates adults with intellectual and developmental disabilities with adults age 55+. Affordable housing options are part of the overall plan, as is the latest technology for independence and safety. Recognizing that “home” is more than a building, this creative solution developed a community for a population at risk of homelessness.
Another innovative development is Cahill Place, opening in 2020 in Inver Grove Heights. This 40-unit building will provide supportive housing for homeless families. Demonstrating that there is no ‘one’ solution to the affordable housing crisis, a multitude of funding sources were utilized to make Cahill Place a reality, including:
So, do we have work to do in order to start reversing the statistics and some of the predictions shared at the Symposium? Absolutely we do – a lot of work. And it won’t be easy. But the commitment, creative problem-solving and enthusiasm I experienced at the Symposium make this economic development professional and Minnesota resident optimistic that we will continue to make progress in addressing our state and country’s affordable housing challenge.
For more information on this topic, or to learn how Baker Tilly specialists can help, contact our team.
 MN Housing Partnership “State of the State’s Housing 2019” report