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Commonwealth Housing Task Force Summary of Progress as of December 31, 2013 Note: in order to reduce the size of these reports, we have condensed the description of regular ongoing activities, and have moved much of the Chapter 40R update to Appendix I of this report. For background, please visit www.tbf.org/chtf or www.commonwealthhousingtaskforce.org and click on “Quarterly Updates”. A key to the Appendices and the Appendices themselves follow at the end of this Quarter’s report. During the very active third and fourth Quarters of 2013, the Commonwealth Housing Task Force focused its efforts on: 1. The implementation and monitoring of Chapter 40R, including advocacy for pending legislation and funding. 2. The call for an increase in state funding for affordability, and monitoring of both state and federal legislation and programmatic developments. 3. Strategic planning for new initiatives of the Task Force, including assuring that the benefits of new construction under 40R and other state programs are available to the widest range of households, work with the committee to focus on public housing, and work with the State Administration to maintain a focus on housing programs. 4. An expansion in participation in the Task Force itself, with a focus on diversity. 5. Working in close partnership and collaboration with other groups to support our missions. 6. We do have one special mention for this Report. We have consistently included a great deal of original source material in the Appendices. If you have time to read only one thing, please read Mayor Thomas Menino’s speech to the Greater Boston Chamber of Commerce, delivered on December 10, 2013, and found in Appendix V (page 81-84). It is likely his last major speech as Mayor; we believe you will find it as moving as we did. Barry Bluestone, Eleanor White, and Ted Carman, working through the Dukakis Center for Urban and Regional Policy at Northeastern University, have carried out the staff work in coordination with active committees and Boston Foundation staff. Release of Greater Boston Housing Report Card 2013 and CHTF Plenary Session Beginning in earnest in July, the Northeastern University Kitty and Michael Dukakis Center for Urban and Regional Policy’s housing team, led by Barry Bluestone and including Eleanor White, began preparing this year’s Greater Boston Housing Report Card (GBHRC) 2013. This entailed collecting a huge amount of information on: The economic condition of the Commonwealth and Greater Boston Housing sales and prices for single family homes, 2-4 unit buildings, and condos Housing construction Apartment Rents Commonwealth Housing Task Force Quarterly Report December 31, 2013 Page 2 Foreclosure activity Federal, state, and local housing policy Chapter 40R activity Public funding for housing Housing stock, prices, production, and foreclosures for all municipalities in Greater Boston In addition, a new statistical analysis of the impact of zoning provisions on multifamily housing production was completed to be included as a special chapter in this year’s report. Through August and into September, the staff prepared all of the charts and tables for GBHRC 2013 and drafted chapters for the report, Barry Bluestone worked with Kate Canfield to prepare the final copy for the report including all charts, tables, text, and appendices for release in early October. On October 10, the Greater Boston Housing Report Card 2013: What Follows the Housing Recovery? was released at a major forum at The Boston Foundation. Barry Bluestone reviewed the results of this year’s report and was followed by a panel commenting on the report’s findings. The panel included Tim Warren of the Warren Group, Alicia Sasser Modestino of the Boston Federal Reserve Bank, Elyse Cherry of Boston Community Capital, and Eric Belsky, Managing Director of the Joint Center for Housing Studies at Harvard University. Following the panel, Aaron Gornstein, the Under Secretary of the Massachusetts Department of Housing and Community Development (DHCD) discussed the state’s efforts in meeting housing goals. All agreed that the housing recovery is now in full flower, but that serious issues of affordability still plague the Boston area. The Report Card’s analysis highlighted the ways in which zoning interventions dramatically increase the production of multifamily housing, specifically pointing to Chapter 40R and both inclusionary and cluster zoning. The report was featured in the Boston Globe, WBUR, WBZ, and other media outlets. Refer to Appendix II for Banker and Tradesman articles about the Report Card and Aaron Gornstein’s comments. The full Report Card 2013 can be found at http://www.bostonfoundation.org/subsites/content.aspx?id=16688. Following the above segments, Mary Jo Meisner, Vice President of The Boston Foundation, convened the plenary session of the Commonwealth Housing Task Force. Co-chair Eleanor White, newly-returned to Boston after four years living in Oslo, Norway, welcomed the group and introduced presentations by Sarah Lamitie, co-chair of the Expanding Opportunities Committee, Chuck Eisenberg, co-chair of the Public Housing Committee, and Ted Carman, “father” of Chapter 40R, the Smart Growth Zoning and Housing Production Act. Details of each of these reports can be found later in this Report under the appropriate committees and reports on 40R. Noteworthy, however, was Ted Carman’s presentation of a slide show of fifteen of the projects completed in Chapter 40R districts; the audience was impressed by the quality of the housing and the demonstrated effectiveness of this program to create zoned land for multifamily housing. Commonwealth Housing Task Force Quarterly Report December 31, 2013 Page 3 Housing Market Updates Press coverage during this period about news in the housing market, continuing the trend we reported on in the last several Quarters, was optimistic. We have in recent Quarterly Reports covered the huge jump in rents in multifamily rental housing in Massachusetts, particularly in the Greater Boston area, and that trend continues unabated, as covered in our reporting about the Greater Boston Housing Report Card 2013. Banker and Tradesman of July 21, 2013, carried a detailed article about the multifamily market in Boston and the Boston Globe further highlighted this issue in an article on October 15, 2013 about the City of Boston becoming a city of the rich and poor. Relative to the single-family side in Massachusetts, the article in Banker and Tradesman of August 29, 2013, was one of dozens during this period to report on the very hot single-family market, with homes selling very quickly and often for more than the asking price. Bidding wars in the more affluent suburbs are not uncommon. Banker and Tradesman followed up with 2 more articles (on November 26, 2013 and December 1, 2013) showing that the robust housing market had continued through the end of 2013. All of the articles mentioned in this section are included in Appendix II to this Report. Nationally, the situation for renters is problematic. A new report released by the Joint Center for Housing Studies at Harvard, “America's Rental Housing: Evolving Markets and Needs”, released on December 9, 2013, states that more than half of US renters pay more than 30 percent of their income for rent. A story about the report published by the Boston Globe can be found in Appendix II and the Joint Center’s full report can be found at the following link: http://www.jchs.harvard.edu/research/publications/americas-rental-housing-evolving- markets-and-needs. Investigation into Construction Costs Research continued at Northeastern University’s Dukakis Center into the reasons for very high housing development costs in Boston. Continuing with the partnership among The Urban Land Institute (ULI), the National Association of Industrial and Office Properties (NAIOP), and the Dukakis Center at Northeastern, Dukakis Center staff met with representatives of Suffolk Construction to begin the process of obtaining detailed cost data on construction costs in Boston and a number of other metro areas, including New York, Washington, D.C., Chicago, and San Francisco. The research team is gathering information on both development costs and operating costs from a range of national housing developers and construction firms. In addition, during this fall semester, Barry Bluestone led a directed study for three graduate architectural students at Northeastern. These students have been using Commonwealth Housing Task Force Quarterly Report December 31, 2013 Page 4 data from RSMeans to compare the cost of constructing a 20 story “non-combustible” central city apartment building in a number of U.S. metro areas. That report will be complete by the end of December and should be issued early in 2014. Student Housing Effort Barry Bluestone also continues to pursue efforts to deal with the issues in the housing market presented by Boston’s being such a renowned center of higher education. We house more than 100,000 full-time 4-year college students on campus in the Boston area, but nearly 180,000 live off campus, putting huge pressure on an already-overheated rental housing market. Further, whereas 50 percent of undergraduates live on campus, only 8 percent of graduate students do. Barry has developed an innovative model of seeking to develop graduate student villages (described in several past CHTF Quarterly Reports). Working off of his initial model for a “multi-university graduate student village,” Barry Bluestone expanded on this concept to produce a plan for the development of 5,000-8,000 units of housing in Greater Boston aimed at graduate students, medical interns and residents, and other young professionals. In November, he produced a major report on how such “Millennial Villages” could be developed through a “grand collaboration” of for-profit and non-profit developers, construction firms, architects, universities and teaching hospitals, and state and local government.