MIAMI-DADE COUNTY

These fully redone apartments may help solveMiami’s housing crisis. The rent stays cheap.

BY ANDRES VIGLUCCI

MAY 16, 2019 06:00 AM

AO

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Joseph Akharoh tours through his renovated apartment during the "Move-In Celebration" at the 16 Corner Projectin Overtown on May 14, 2019. Akharoh will be receiving his renovated apartment once construction is complete.BY MATIAS J. OCNER

Here’s one possible solution to Miami-Dade’s mounting housing-affordability and gentrificationcrisis: Fix up the places where low-income people already live, and keep the rent down so no one’spushed out.

That’s the deceptively simple approach now being tested in Miami’s Overtown by a city agencyand a private developer best known for transforming 1950s MiMo motels on Biscayne Boulevardinto hip attractions. So far, it seems to be working.

This week, developer Avra Jain and the city’s Omni Community Redevelopment Agency unveiledthe first results of what might prove to be an innovative cost-sharing collaboration — a 1950s two-story apartment building, until recently a mold-infested blight, that has been totally rehabbed tohigh standards.

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That’s not even the most promising part. The building’s tenants didn’t have to move far during theseven-month gut renovation, just next door. Later this month, they get to move back into theirapartments, now sparkling new with hardwood kitchen cabinets and granite counters, copperplumbing and high-efficiency air conditioning.

And once they do, they will pay virtually the same low rents they were paying before therenovation for what was slum housing. That’s $750 to $825 for a range of unit sizes that includes athree-bedroom, two-bath apartment. For 30 years, the rents will increase only marginally to keepup with inflation.

“I like it. I love it,” said a smiling Joseph Akharoh as he toured his gleaming new studio apartmentfor the first time on Wednesday. Akharoh, 31, moved into the building five years ago aftergraduating from college to save money for student-loan payments while he set up a smallconsulting business.

“It’s much better than before. And they still kept the prices the same, which is what you worryabout when they do these projects.”

The building is small, just eight apartments. But Jain and the CRA bought four other adjacentbuildings for what they’re calling 16 Corner. Rehab will start on the next building just as soon asAkharoh and the other tenants move out and into their new homes next door. Eventually, that willmean a total of 44 high-quality units of very affordable housing with virtually no displacement.It’s a model the developer and agency officials believe can be replicated across poorneighborhoods in the urban core.

In most of those areas, they say, there is high demand for inexpensive but decent housing, and alarge supply of badly deteriorated but solidly built apartments that are candidates for renovation.Often, when conditions get bad enough, those buildings are condemned and torn down. Result:occupants are left to fend for themselves in an unforgiving rental market, and the communityfabric becomes further frayed.

Meanwhile, most affordable housing projects built with federal subsidies are large and costly. Bylaw, those can’t favor those already living in the neighborhood.

The newly rehabbed building was a tear-down candidate, too, noted Miami CommissionChairman Ken Russell. Saving it meant not only preserving the structure but also theneighborhood.

“We have a crisis right now,” Russell, who is also the Omni CRA chairman, said. “But it’s not justabout building new towers. It’s about holding the bones of what we have now for the people whoare here now.”

The formula requires marrying the skills and financing of an experienced private developer withpublic subsidies and the willingness to cut through the red tape of the CRA, which collects apercentage of property tax revenue from new development within the Omni district. Withconstruction in the area booming, the formerly strapped agency now expects rising revenue thatcan be put to work rehabbing more housing.

An exterior view of a newly renovated apartment building at the 16 Corner Project in Overtown, The collaborationbetween developer Avra Jain and Miami’s Omni Community Redevelopment Agency is being touted as a newmodel for addressing Miami’s housing affordability crisis. MATIAS J. OCNER MOCNER@MIAMIHERALD.COM

Jain’s 16 Corner is the first affordable-housing project by the Omni CRA, though its neighbor tothe south, the Overtown CRA, has helped finance dozens of units. What’s unusual about theOmni CRA approach is its emphasis on preserving buildings and keeping people in place.

The agency provided $1.8 million for purchase of the five buildings and $2 million more towardsrenovation costs, with Jain putting up the rest. The project’s total cost, Jain, estimates, will be $6.5million. Jain’s Vagabond group, working with Mt. Zion Church’s community redevelopmentcorporation, will manage and maintain the property. To help keep costs low, Jain did not take adeveloper’s fee, though she does expect to make a small profit.

The CRA subsidy is what makes it possible for her not to raise rents, Jain said. Otherwise, the$80,000 per unit purchase cost and the $60,000 per unit rehab cost would have required rents toroughly double, she said. Without the revenue, no bank would finance such a project, Jain said.

“The numbers don’t work. That’s why they stay slums,” Jain said.

Resident Quantanae Byrd, 25, records a video of a renovated apartment during the “Move-In Celebration” at the 16Corner project in Overtown. MATIAS J. OCNER MOCNER@MIAMIHERALD.COM

Another advantage in working with the CRA is that the agency can work quickly, is flexibleenough to design its own policy, and is not bound by sometimes onerous administrative andpaperwork requirements to qualify for federal tax credits or other subsidies. Those can make aproject nearly impossible for a small or mid-size developer, she said — another obstacle tofinancing the kind of small-scale rehab projects she believes are needed.

Jain completed a small, federally subsidized 24-unit project with Miami-Dade County in LittleHaiti that involved renovating a historically designated courtyard-style motel, but said she won’tdo so again because of the time and money spent on administrative requirements.

The Overtown project, by comparison, can be a case study. CRA executive director Jason Walker,who recruited Jain, developed a blueprint that can be repeated. Future projects could move evenmore quickly because legal and other kinks were worked out for 16 Corner, CRA administratorssaid.

Resident Joseph Akharoh looks through a renovated apartment during the “Move-In Celebration” at the 16 Cornerproject in Overtown. MATIAS J. OCNER MOCNER@MIAMIHERALD.COM

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The lesson, Jain said, is that tackling the city’s affordable housing crisis can be relativelystraightforward, and the payoff significant.

“Take these old buildings, don’t knock them down, don’t displace people,” Jain said. “It keepscommunities and the texture of the neighborhood intact. It’s important for Miami.”

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