In our ongoing mission to increase the availability of affordable housing, we are heartened by some recent news out of Salem, Oregon. A partnership between the city and a real estate investment company is set to preserve northeast Salem’s Orchard Park Apartments — Oregon’s largest affordable housing complex outside the greater Portland area.
Over 220 apartments in Salem will remain available to low-income renters under a public-private partnership to preserve the region’s largest affordable housing complex. Apartments like Orchard Park which rent below market rates are typically given tax breaks or other incentives for a specified period of time, during which the property owner agrees to limit rents based on state affordability guidelines. When that period expires, often after 30 years, building owners can return the units to market rate. But before doing so, owners must notify the state or local government and give them an opportunity to purchase the property at market rate.
Maintaining the affordability of the apartments was the result of the purchase of the units by Aberdeen Capital, a Woodinville, Washington-based socially conscious real estate investment company. Through a partnership with the Salem Housing Authority and Oregon Housing and Community Services, the complex has been purchased by this partnership, and the result is that it will preserve 220 units of affordable housing for Oregonians. Keeping Orchard Park affordable was a top priority for the Salem Housing Authority. The loss of such a large complex would have undone years of work to build new affordable housing projects in Salem.
The property will remain tax-exempt under the purchase agreement. Aberdeen received $20 million from the state toward the purchase and another $3 million toward needed repairs from fire damage.
Addressing housing supply shortages will require different, highly localized strategies. In many cities, more affordable multifamily rental housing will make a big difference in improving housing affordability. In other markets, solutions should be focused on the building of new single-family homes, while in other markets it may be preserving existing multifamily housing.
The Foundation for Affordable Housing has been working together with its partners for almost 30 years to address the affordable housing crisis.
