Two new housing developments utilizing subdivided airspace were recently honored as Projects of the Year by the San Diego Housing Federation during the presentation of the 2014 Ruby Awards for the best affordable housing projects in the county.
For both The Post Housing in Imperial Beach and Citronica One Lemon Grove, the winning formula involved taking one building and creating two parcels within each project, explained Dennis Stryker of San Diego-based Stryker Slev Law Group. The four-story Post Housing in I.B. was honored in the category of Housing Project of the Year with 50 units or fewer. Citronica One was recognized as Housing Project of the Year with more than 50 units.
“The concept of subdivided airspace is not uncommon in a lot of places, but it is not used a lot on the West Coast,” he said. “It’s essentially a building on the ground with another ‘building’ sitting on top of it.”
In Imperial Beach, Stryker Slev represented the property owner, American Legion Post 820, which was looking to build a new facility and retain ownership of the land while also providing affordable housing for veterans, seniors and others in Imperial Beach. Located at the gateway to the city at 1268 Palm Ave., Legion and city officials wanted to create a project that would make a good impression on passersby, Stryker said.
The idea of condominiums and an owners’ association were not good alternatives for this type of mixed- use venue, he explained. So the solution was to turn the space above the new Post hall into 29 apartments and a manager’s unit owned by a limited partnership, comprised of Hitzke Development and others, with Hitzke acting as the developer. Design duties were handled by Foundation for Form.
“It was our job to help the various stakeholders understand how the project would fit together,” Stryker said. “The city has to be commended for sticking with it. They stayed the course and we figured out how to make it work.”
The need to split project uses at Citronica One, which also has earned an SDG&E Energy Efficiency and Sustainability Award, called for a similar solution. When Hitzke brought Stryker Slev on board, the commercial-affordable housing project was under construction as a condominium. Again the issue of an owners’ association was at the center of the challenge. By restructuring the project into two parcels, they were able to eliminate the need for an association and help the investors, lenders and city officials grasp the subdivided airspace concept.
One parcel is 3,700 square feet of street level commercial space at the site at 7751 North Ave.; the other is 56 apartments – 15 of which are designated for underserved transition-aged youth with mental illness eligible for supportive services.
The $15.8 million project, which is LEED Platinum certified, opened in Spring 2013. Commercial tenants will include a restaurant, which is still in the design phase. Located near the Lemon Grove Avenue Trolley station, it was designed by Foundation for Form Architecture.
“It was important for everyone to understand the why and the what, while realizing this would not affect the underlying residential units. Overall, this is a better solution for the investors and those who finance affordable housing.”
Stryker noted the cooperative atmosphere they found in Lemon Grove mirrored their experience in Imperial Beach.
“Smaller cities are very much in tune with listening to property owners and seeing how things work,” he said. “There were no naysayers, rather they were asking how their cities can invest in affordable housing.”
The importance of working together takes on more significance since the disappearance of redevelopment districts that used to help projects like these become reality, he added.
“Change is always hard, but we are starting to have cities and lenders willing to take risks on projects like these.”
ABOUT STRYKER SLEV LAW GROUP
With expertise in construction, real estate and business law, Stryker Slev provides legal and ancillary counsel to property owners, design teams, builders and developers in California, Arizona, Nevada and Colorado. For more information, visit www.strykerslev.com.
ABOUT HITZKE DEVELOPMENT CORPORATION
One of San Diego’s most active developers of affordable housing, Hitzke Development Corporation has particular expertise in transit-adjacent, mixed-use, high-density communities. For more information, visit www.hitzkedevelopment.com.