Below-Market Rate Units a First for Reserve
Equity Residential has submitted plans to add 25 below-market rate apartments to its Reserve at Mountain View Apartments because the community has none among its 180 apartments at this time.
MOUNTAIN VIEW, CA—Much has been discussed about the inverse proportion of housing compared to Silicon Valley job growth, with numerous studies to back those assertions. As part of its effort to find solutions at its existing communities, Equity Residential recently submitted plans to the city to add 200-plus apartments to its Reserve at Mountain View Apartments, including the addition of 25 below-market rate residences. Currently, the community has no below-market rate units among its 180, one- and two-bedroom apartments.
Once approved and completed, the new apartments will be offered at a price below the current rent-controlled rates at Reserve at Mountain View, and will remain below-market rate for at least 55 years. With the Reserve at Mountain View community covering nearly 10 acres, only 42 existing apartments will need to be vacated to make way for the new addition. Residents who have incomes of less than the 120% average median income could have relocation expenses covered and the choice on a first-come, first-served basis to relocate to a like-kind apartment at Reserve at Mountain View or one of three other Equity Residential properties in Sunnyvale. Any of those choices will provide a rent-controlled rate for three years, explained John Hyjer, first vice president investments and development, Equity Residential. He went on to add that instead of relocation, eligible residents could also take a cash buy-out option 50% higher than the city requires.
Hyjer further clarified that all relocating residents, regardless of age or disability, are being given more than a full year to select an alternative housing option–allowing for ample time to evaluate options and work with Equity Residential’s relocation coordinator.
The remaining 138 apartments within the 1965-era community have all been renovated or are in the process of being upgraded with new kitchens, quartz countertops, subway tile backsplashes, dishwashers, stainless steel appliances, new bathrooms, air conditioning, double pane windows, in-unit washers and dryers, and honey oak flooring.
“Not only are we creating an approximately 3,200-square-foot rooftop amenity terrace with an outdoor kitchen and lounge seating, we’re also adding a new 1,800-square-foot fitness center and upgrading the lifestyle at the community overall,” Hyjer says.
Construction on the new apartments is anticipated to begin in second quarter 2020, with estimated completion in 2022. The architect for the new apartments is Steinberg Hart and the landscape architect is San Francisco-based MFLA.
“While adding new apartments to existing low-density communities appears to be a rather simple solution to adding much-needed housing stock to our communities, not all properties are good candidates,” Hyjer tells GlobeSt.com. “In addition to ensuring it makes good business sense, each property must be examined thoroughly from both an interior and exterior quality of life point of view.” Using the Reserve at Mountain View as an example, less than 25% of the apartments are being replaced with more than 200 new apartments, Hyjer explains.
“We will be upgrading the existing 138 interiors to comparable quality, and adding new amenities for all of our residents to enjoy,” Hyjer tells GlobeSt.com. “From a neighborhood perspective, the Reserve is located directly on El Camino Real, one of Mountain View’s major thoroughfares providing immediate access to I-85, I-237 and I-101, reducing community impact. Further, the Reserve is less than two miles from CalTrain’s Mountain View station which provides access to greater San Jose, the Peninsula, San Francisco and beyond. One of the truly great aspects of the redevelopment plans is we’ve designated 25 of the new units as permanent below-market rate apartments, providing housing solutions to those with household incomes between 50-80% of the area median income.”
To be sure, the high cost of living continues to plague the region. As of November 2018, the median price of a single-family home in the Bay Area was $905,000 (a 0.6% increase year over year), according to a report by Kidder Mathews. San Francisco home prices fell slightly by 3.8% from the previous year, at $1.44 million as of year-end 2018. In contrast, home prices in San Mateo County rose slightly by 0.9%, and command the highest price among all nine counties at $1.5 million. As of October 2018, median home prices stand at $309,700 nationwide.