This document summarizes the challenges faced in developing an affordable housing project called Parksdale Village. It began with promising resources and funding opportunities but faced many obstacles. The project aimed to build 126 single-family homes and 96 rental units but the single-family portion struggled after the real estate market declined sharply in 2008. Infrastructure issues like the sewer lift station caused problems. Local commitments did not always materialize as hoped. However, some rental housing was successfully developed and the developer learned lessons that will help future phases be more resilient.

1. Best laid plans
Horrid tales of affordable housing
development
National Rural Housing Conference
2012

3. 2003 - It sounded good at the
time
O Plentiful resources
O USDA self-help program running
strong, with administrative and mortgage
funding
O Secondary financing available
O Rental housing LIHTC accessible
O Good market outside urbanized area with
high farmworker needs

4. Parksdale due diligence
O Sewer and water – commitment letter!
O Zoning
O Environmental
O Eligibility for funding
O Competitive status of area
O Market
O Government requirements
O Offsite requirements

5. What can go wrong?
O Structuring the purchase (when possible
option)
O When elephants fight (city v. county)
O A recession? Nah, can’t happen.
O The American Dream on hiatus

6. Deal breakers
O Infrastructure
O Rights to develop / entitlements
O Funding contingencies
O Can you land bank?

7. Timeline
O Option to Purchase agreement signed –
April, 2004
O Purchased – June, 2005
O HAC land bank loan - 2005
O Design – proposed map September, 2006
O Entitlements approved – February, 2007

9. The Project
O 126 Single family homes in three phases
O 96 Multifamily rental units in two phases
O Neighborhood park
O Shared costs through assessment district
O New water well for community
O New sewer lift station

10. Promises, promises
If you wish to be a success in the
world, promise everything, deliver nothing.
Napoleon Bonaparte

11. Some stuff works
O Rental housing development – better than
hoped for
O First project funded – HOME 2008, LIHTC
2009, placed in service 2010
O Second project funded – HOME
2010, LIHTC 2011, placed in service 2012

12. Parksdale Village I

13. Community Room

14. Some stuff doesn’t work
O Single family first phase – 49 lots
O First self-help group started June, 2010
O Second group started October, 2010
O Third truncated group started
December, 2011
O Currently 23 lots remaining, no new
builders approved

16. What Happened?
O Peak of real estate value in California –
2006
O By 2008, real estate values down at least
30% from peak
O By 2010, at least 50% down

18. How bad can it get?
O Sewer lift station nightmare
O Appraisals
O Loss of subsidies (eg. School fees)
O New requirements, new costs
(sprinklers, Energy Star)

20. What have we learned?
O Smaller projects
O Promises from local jurisdictions often
mean less than intended
O Beef up your kneepads

21. Parksdale Village II

22. The future, brightly
O Allocating costs to future phases
O Building when conditions dictate
O Watch for RD eligibility

25. Why we persevere