Policies and Politics, Not TODs, Are to Blame for Affordable Housing Crunch

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Logan Square’s “The L” transit-oriented development under construction last month. Photo: John Greenfield

Yesterday the Tribune’s Mary Wisniewski further explored a topic Streetsblog’s John Greenfield covered two weeks ago for the Reader. Virtually all of Chicago’s new transit-oriented development projects are upscale buildings in affluent or gentrifying neighborhoods. TOD advocates argue that adding housing in these communities will take pressure off the rental market. But some Logan Square residents say soon-to-open TOD towers in the neighborhood will encourage other landlords to jack up rents.

The rents at the Twin Towers and “The L” developments near the California Blue Line station will start at $1,400 for a studio. Activist groups like Somos (“We Are”) Logan Square and Lifted Voices recently blockaded Milwaukee Avenue in front of the Twin Towers to make the argument that the buildings will speed the pace of gentrification and displacement.

The city’s TOD ordinance, first passed in 2013 and beefed up in 2015, has fueled the city’s recent building boom by reducing and then eliminating parking requirements for new buildings near rapid transit, as well as allowing for more density. For example, Rob Buono, the developer of the two towers in Logan Square, told John that he probably wouldn’t have built the apartments if the ordinance hadn’t passed.

The towers are big, conspicuous buildings, so it’s understandable that some people blame them for rising rents elsewhere in the neighborhood. But the TOD ordinance and the resulting increase in the number of housing units near the Blue Line aren’t to blame for the community’s displacement problem. Rather, prior to the ordinance’s passage, the number of allowable units near train stations was constrained by politics and growth-inhibiting policy.

TOD experts Wisniewski interviewed said that the trend towards dense housing near stations is a return to sensible pre-1950s city planning. A 2013 study by the Center for Neighborhood Technology found that Chicago actually lags behind peer cities like New York, Philadelphia, Boston and San Francisco when it comes to development near transit. The article also noted that the Chicago Housing Authority demolished 6,000 affordable housing units that were near transit stations.

In recent decades, Chicago zoning rules and politics have ensured that dense development near neighborhood train stations has been relatively rare. Instead, it has mostly occurred downtown, where zoning changes aren’t necessary or are easier to get, and backlash from neighbors is less likely.

In neighborhoods like Logan Square where housing affordability is an issue, there have been dozens, if not hundreds – it’s very difficult to track – of expensive new single-family homes with city-required two-car garages built near train stations, the California Blue Line stop.

For example, last year 12 single-family homes were built on the 2600 block of West Medill Avenue, about two blocks northeast of the Twin Towers. Redfin shows that most of these sold for more than $825,000 (the website doesn’t have sale prices for all of them).

In the Twin Towers and “The L” ten percent of the apartments will be on-site affordable units, which 1st Ward alder Joe Moreno requires as a matter of policy before approving zoning changes – he doesn’t allow developers to take the buyout provision. But those new single-family homes on Medill, and all of the others built in the neighborhood, represent zero affordable housing.

These houses are all near the train station. If TODs had been built on this land instead, there would have been more housing units and fewer parking spots per unit. That would have also meant fewer cars being brought into the neighborhood with each new household.

The politics around neighborhood housing development are hindering projects that would result in new affordable housing. Last year “The L” developer Property Markets Group proposed building a 560-unit rental TOD on a long-vacant parcel near the Hasted Street/UIC stop on Metra’s BNSF Line, which required a zoning change.

Currently, if a developer wants a zoning change or a tax incentive, a city ordinance requires them to either include at least 10 percent affordable units or pay into the city’s affordable housing fund to help build units elsewhere. But alders can require developers to build more than 10 percent onsite affordable units before approving zoning changes.

25th Ward alder Danny Solis typically requires 21 percent of units in a new development to be affordable before he’ll grant a zoning change. Property Markets Group was only willing to provide roughly 90 units — about 16 percent. So last February Solis turned down their request for a zoning change, adding that he felt the plan called for too many units.

Two months later, PMG announced that they would build a mix of different kinds of housing on the land. They didn’t specify the number of units, but the existing B3-2 zoning allows approximately 150 units on the property. Since they don’t need a zoning change from Solis to move forward, they’re choosing not to include affordable units.

I’d argue argue that Solis’ strategy backfired. His demand for 21 percent affordable units resulted in Pilsen getting no new affordable housing. If he had approved PMG’s original proposal, the community would have gotten the roughly 90 affordable units that PMG was willing to build.

Sports Authority, which filed for bankruptcy, will sell all of its property and likely close. This is a large parcel that could be TOD because it's near the Belmont Red/Brown Line station.
The Sports Authority in Lakeview is a good candidate for TOD because it’s a five-minute walk from the ‘L’. Image: Google Maps

To help promote affordability and reduce car dependency, alders and community groups should identify land near train stations that’s ripe for development and proactively work with developers to create equitable TOD plans.

Right now there’s a large parcel in Lakeview that’s a likely site for a future TOD. Sports Authority recently declared bankruptcy and announced that that they will sell off a lot of their real estate properties, which could mean that many of their stores will close.

They have a large store and parking garage at the northwest corner of Barry and Clark, a five-minute walk from the Belmont ‘L’ station. The roughly 63,000 square-foot parcel is zoned B3-3, so it’s already TOD-ready and can accommodate several hundred apartments or condos.

The Metropolitan Planning Council’s TOD calculator (which I provided some data for) estimates that a residential or mixed-use TOD building here would contribute hundreds of thousands of dollars in property tax and sales tax revenues to the local economy.

While Lakeview is already an affluent neighborhood, rather than a gentrifying one, it’s similar to Logan Square in several ways. Housing costs are high, many multi-unit houses have been and are being converted to single-family homes and, as a result, the population has decreased, providing a smaller customer base for local businesses. More TOD can provide many benefits for both of these communities.

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  • JacobEPeters

    That Sports Authority site seems like an ideal place to get a mixed income development to replace some of those 525 public housing units lost at Lathrop. Could be a 30/30/30 project & add affordable & market rate units.

  • ardecila

    Mixed income doesn’t happen without government funding, which means it doesn’t happen without community and aldermanic support. Try getting the gentle citizens of Lakeview to accept 60 units of public housing in their neighborhood. At least with affordable housing, you can pitch it as “workforce” housing, and developers often do that to emphasize that their tenants are productive and gainfully employed – after all, they still have to make rent every month.

    Truly public housing often goes to those with the greatest need – people with the lowest or zero incomes, due to lack of education, disability, or criminal record.

  • planetshwoop

    Isn’t there a pub housing tower North of Clark and Belmont?

  • Obesa Adipose

    Senior housing.

  • geriatricgretch

    Perhaps I’ve missed it, but has anyone (CTA officials or otherwise) addressed how these new units will affect crowding on the blue line? Will the new train cars have enough capacity? Are they adding cars? Upping train frequency? It’s already impossible to get on half the time at Western-O’Hare as it is.

  • Jeff Gio

    Welp a failure should force a change…

  • Lake View is affluent, but in the eastern part there are actually a lot of older buildings that have been carved up into small and relatively affordable units over the decades, just do a search on 60657 here, you might be surprised:

    http://www.census.gov/censusexplorer/censusexplorer.html

  • war_on_hugs

    My take is that blaming these high-profile developments for displacement is only looking at the symptom, rather than the cause. As the article notes, TOD has been constrained by a variety of government and community forces over the years, so pretty much the only profitable developments these days will be large, dense towers with high rents, in part to make up for years of legal wrangling.

    Of course, developers’ natural inclination is to build for the luxury class anyway, so it’s not like it’s only evil NIMBYs causing this phenomenon. But a proactive approach that calls for more “missing middle” development (with policies to back it up) would be far better for all residents in the long run than simply stopping all development, period.

  • Jared Kachelmeyer

    Its a few hundred units. The overall population of the neighborhood is going down. Though not sure about CTA ridership.

  • Ryan G-S

    That entire intersection (Clark/Halsted/Barry) is a low-density, parking lot-laden wasteland. The Sports Authority parcel is a great place to start! The single-story Walgreens and CVS and their parking lots can be next. Clark Street Dog can stay, but they really need to turn their small parking lot into a beer garden.

  • Chicagoan

    Yes, the Barry/Clark/Halsted intersection is horrid beyond belief. Odd as it’s mere feet from the bustling and urban Belmont/Clark intersection. They should tear up the Bank of America, Binny’s, Clark Street Dog, CVS, Michaels, Ulta Beauty, and Walgreens lots to create something much more urban.

    I’m optimistic this’ll commence sometime soon, I think that those lots are far too valuable to continue in that current form.

  • BlueFairlane

    Streetsblog reported in February that eight TOD buildings are bringing 1,146 units to Milwaukee Avenue as of that moment, and I’m sure that number is rising. And that’s just counting what’s lining Milwaukee. Meanwhile, the population that’s leaving the neighborhood is largely not composed of Blue Line riders. I’d say it’s a fair bet to say the Blue Line will see an increase of at least 4,000 daily trips (on the low end) by the end of 2017. It would be nice if the agency were to commit to looking at that beyond shrugging and saying “We’ll see.”

  • Chicagoan

    Any River West people on here want to share what it’s like trying to board at Chicago or Grand on the Blue Line? I’ve seen the crowds at Damen, Division, or Western. I wonder if people have to let a few trains pass before they can board.

  • I agree in general, but I think it would also be a fair take to describe them as fuel on the fire.

    Just the ridiculous media coverage alone these properties have received is almost a form of corporate welfare.

  • Yep. It’s that lack of a Plan B that I find most troubling. I don’t think urban planners have a good take on the fact that Chicago’s economy isn’t constrained to rush hour traffic to/from downtown. I have been boarding at Belmont for 14 years, it is most definitely getting packed to the point of discomfort (meaning people can’t actually get off of the train without holding it up) by Western during rush hour.

  • Chicagoan

    I’m not as well-read on this, so, what could they do? Is it possible to add an additional passenger car to every Blue Line train? I’ve heard some people discuss Chicago ordering cars like the ones in Europe (I’ve been on them in Madrid, Paris, and Vienna, I believe, they are nice!), but considering the CTA has an order in for the next series, this isn’t happening.

    The CTA’s approach to crowding on the Blue Line is pretty laissez-faire, which isn’t great.

  • JustCuriousAboutAffordability

    I wonder: How will the ‘affordable’ units stay ‘affordable’? Or will they? I.e. how long will they be ‘affordable’? Say, 30 years from now, or 50 years from now, will they still be affordable? What is the definition of ‘affordable’? Are affordable units ‘rent controlled’? Are the affordable units only ‘rentals’ or are they also for sale ‘owner occupied’ units (single family and condos)?

  • simple

    How long does this crowding last? In which direction? On all cars of every train?

    When these trains are so crowded that people can’t get on, how much of that is because people are not distributing themselves throughout the train? How much is because people do not distribute themselves throughout individual rail cars? Has CTA’s investigation of train interior layouts really focused on more effectively managing behavior of passengers in crowded trains, or has it focused more on providing comfortable seating space when there’s no crowding?

    How much of this crowing problem can be addressed by slight shifts to commute times (how many riders are commuting during the peak of the peak because that’s the time they simply prefer to travel versus having a boss that forces them to travel then)? Would a campaign to encourage shifting travel times on the most crowded lines be a better use of marketing resources than encouraging people not to walk on CTA tracks (as if that is really a problem commensurate with the attention CTA seems to give it)?

    The more trains CTA runs in the peak direction during the peak hour, the more inefficient those empty trains are heading back out in the off-peak direction. From a policy perspective, crowding during peak periods represents an extremely efficient use of CTA’s limited resources, so tolerance for crowding should be high. If there’s not enough resources to do both, it’s much better to tolerate (and, to the extent possible, more effectively manage) peak period crowding than to cut service off-peak in order to shift the resources to peak. A crowded train or bus is unquestionably better than none at all.

  • JKR

    Its funny how people treat transit-oriented development as if its some new invention despite developers have been building off of railroad lines since the railroads were invented. The lather is keeping a neighborhood poor with series of auto-oriented development that will drive a Legacy City into bankruptcy, thus the more high density the better. Its up to policy makers to keep the city affordable as the tools exist to do just that. U.S. cities like Chicago should welcome TOD with open arms, specially cities with heavy rail mass transit.

  • BlueFairlane

    Personally, I’m no train expert, which is why I really wish the people at CTA (who in theory should be train experts) were talking about this right now. My first thought would be that there’s room to run trains closer together with shorter headways, though I don’t know how much. But they also could contemplate expanding bus service on certain alternate paths.

    An example … some time last year, there was some sort of Blue Line incident that caused immense back ups, and all the people I follow on the Twitter (who all happen to live along the Blue Line, because that’s how Chicago is right now) were talking about trips downtown talking upwards of two hours. My wife, who gets on at California, saw the line at the station, said “Nope!” in her Lana Kane voice, and hopped the Fullerton bus to the Red Line. For some reason, she was the only person at that moment to think of that, and she got downtown in something approaching her regular commute. She beat people I was watching on the Twitter by a good hour. CTA could ease some of this if they helped more people consider similar alternatives.

  • Kurtis P

    I believe under the new ARO, they are required to stay affordable for 30 years

  • Jared Kachelmeyer

    How do they determine who gets to live in them? Some sort of lottery? Is there a maximum or minimum income level?

  • Kurtis P

    http://www.cityofchicago.org/city/en/depts/dcd/supp_info/affordable_housingrequirementsordinance.html

    Follow this link. For rentals, it’s basically 60% AMI. The City records a lien on the property for those 30 years.

  • geriatricgretch

    Excellent questions! I’d love to know if CTA is asking the same ones or if they are conducting any research on how these TODs (which I think is a great idea in theory – yay less parking/fewer cars) do affect commutes. Public education about shifting commute times/distributing throughout the trains would help somewhat, but I mostly do see trains that are completely packed – there would be no possible way of getting on and I’m still 5+ stops away from downtown. I feel like I’ve heard that we’re at capacity for both frequency of trains and number of train cars, so maybe something like BRT and/or dedicated bus lanes is where we should be headed.

  • Jared Kachelmeyer

    Is 60% AMI for a specific area or the entire city?

  • geriatricgretch

    I applied for one a few years ago when I was a student and the paperwork required was intense (and the promise to provide the same paperwork each year when I wanted to renew my lease). There was a strict maximum income level.

  • Kurtis P

    I think it is determined federally, so it’s actually a larger area than the City (Chicago-Naperville-Joliet, IL HUD Metro FMR Area).

    http://www.cityofchicago.org/city/en/depts/dcd/supp_info/area_median_incomeamichart.html

  • Jared Kachelmeyer

    ok. Looks like its about 32k for a single person. So how much would they pay in rent?

  • Kurtis P

    I think this is the calculation

    ($32,000*30%)/12=$800 per month

  • Jared Kachelmeyer

    ok. Although if one can afford $800 a month they have plenty to choose from on the open market.

  • ardecila

    The city publishes a list of rents for various AMI levels. Since incomes in Chicagoland are totally stagnant, these rents don’t increase very often.

    http://www.cityofchicago.org/content/dam/city/depts/dcd/general/2015renttables.pdf

  • ardecila

    We’re not at capacity for train frequency. I mean, we might be under the current infrastructure, but CTA can still squeeze more out by investing in better signals. Some subway lines around the world average trains every 90 seconds… Blue Line tops out at 3 minute headways right now.

  • ardecila

    I don’t know we can say anything with certainty about transit ridership based on demographic changes. The people “leaving the neighborhood” are largely lower-income and probably more transit-dependent than the people moving in. Whether those people are more likely to ride buses or the Blue Line, I can’t say, but they probably are more likely to commute outside of peak times.

  • ardecila

    It is public housing, but for seniors. Poor seniors don’t seem to raise emotions in the neighborhood like younger poor people do. Interestingly, this was also true historically which is why you see senior housing towers scattered throughout North Side neighborhoods otherwise devoid of CHA.

  • Jared Kachelmeyer

    Does anyone keep track of the number of cars registered in specific neighborhoods?

  • BlueFairlane

    I don’t have any numbers you don’t have, but my observation over the decade I lived there was that most of the people leaving (at least from the properties farther away from Milwaukee or the square) are older homeowners or renters of smallish two-flats who drive every day. That’s why I could always find a parking spot in the middle of the day. The number of cars parked on my particular street and the streets around me have always been much emptier during the day than they’ve been at night, which suggests the cars were being used. The availability of daytime parking has decreased substantially over the last couple of years, though, which suggests their owners are on transit.

    This is anecdotal, of course. I’m not sure how you get at that through data.

  • AnotherJCAA

    Some places/municipalities have an ordinance/law that states that a person purchasing designated “affordable” housing can sell it only for a certain percent more than they bought it for (within a certain amount of time). I.e. they can only make so much ‘profit’ on their investment. Does anyone know more about this — pros and cons? is it in Chicago? what (kind of) municipalities do this? How does it work? is it effective? etc.

  • Tim

    That ‘TOD’ by the Metra BNSF really wasn’t that transit oriented. It was a gambit by a national developer to cash in on a ‘hot’ neighborhood. Two problems: the huge amount of apartments on the plot and the problem of what affordable housing is defined as and for whom. Affordability is determined by an area much larger than the neighborhood and the average income level in the Chicago area is much higher than the average for people Pilsen. One only has to look north across those BNSF tracks at the ‘affordability’ achieved by the university village development. This conjured suburb in a city was supposed to have many affordable units, but not many of the people who were there before are affording them or living in them. The PMG plan was basically an extension of university village.
    Pilsen needs more than 90 affordable units to go along with the market-busting 400+ that were to be built at the site. It is not a forgone conclusion that PMG will be able to build their new no-affordable units development either, so its not certain the neighborhood will be missing affordable units it would have gotten. I’m not sure this was the best example to pick for this story.
    TOD seems like an interesting policy but it is not without flaws, particularly with the current affordable housing policy in Chicago. We can’t let high-priced TODS with little-no affordability be built before the housing policies in the city can be made to work for the people in whose neighborhoods these buildings are to be built.

  • Alex_H

    When I would take the Blue Line from the Chicago Ave station last year, I would regularly have to wait for a couple trains to pass, even at 7:30 am or so.