Urban Redevelopment Authority of Pittsburgh
About the URA
Showcase Projects:
Crawford Square
Development
Phase I of the development, completed in 1993, consists of 203 rental apartments and townhomes; 50 percent of the units are subsidized. In the second and third phases of the development, completed in 1995, the rental program was scaled back in favor of more for-sale housing due to resident and market pressure. In Phase II, 72 new rental units and 30 for-sale units were developed. In Phase III, to be completed in 2000, 74 rental units and 30 for-sale units will be developed.
In response to the reduction in rental units, McCormack Baron partnered with the Hill Community Development Corporation (HCDC) in the second and third phases of the development. McCormack Baron continued to develop and manage the rental units, its area of expertise, while the HCDC assumed development of the for-sale housing.
The master plan for Crawford Square provides detailed guidelines and covenants meant to foster development of a coherent, attractive community. Nevertheless, to encourage variation, different architectural firms were hired to design the buildings for Phase II and Phase III. The housing was constructed by a variety of local minority firms working with several general contractors.
Financing
Conventional financing was inadequate for Crawford Square. The financing package, particularly for Phase I, was complex and multilayered. In addition to the equity contributed by the developer and obtained through the sale of low-income housing tax credits, four other financing sources were used: the Urban Redevelopment Authority of Pittsburgh (loans and grants); the Pennsylvania Housing Finance Agency (loans and bond proceeds); a consortium of four local lenders, PNC Bank, Mellon Bank, Dollar Bank, and Integra Bank (loans and grants); and a consortium of local foundations (grants). "Each participant was necessary to the deal and provided an element of credibility that convinced the others to become involved," said Vince Bennett, vice president of McCormack Baron. "The withdrawal of support from any partner could have stopped the development. Spreading the financial risk both increased the community's sense of responsibility and ensured that the project would be done without sacrificing its quality or scope and that it would be affordable to a diverse population."
Marketing/Management
The ability to attract market-rate residents is a concern in any mixed income development. To the surprise and delight of the development team, market-rate units in Crawford Square have leased up faster than subsidized units and demand for for-sale housing has been exceptionally strong. Pent-up demand for quality in-town housing combined with Crawford Square's exceptional location and downtown views has worked to attract a strong economic and racial mix of residents. Rents range from less than $300 per month for some one-bedroom apartments to $1,200 per month for a three bedroom townhome. For-sale housing starts at about $89,000, and some four-bedroom units in the final phase of development are selling for as much as $200,000. About 80 percent of residents are African American, many of them former Hill District residents who returned to their old neighborhood because new, quality housing was available.
Special financing incentives were provided to homebuyers in the first phase of development. These included a $15,000 grant from the U.S. Department of Housing and Urban Development, and a mortgage subsidy of $25,000 from the Urban Redevelopment Authority of Pittsburgh. In light of the unexpectedly strong demand, these offers were significantly scaled back in later phases.
McCormack Baron provides management services to all rental units at Crawford Square, as well as the community center, pool, and some common areas. A homeowners association manages the common areas around the for-sale housing portion of the development. The association also is responsible for the enforcement of architectural codes and covenants.
Experience Gained
- As one of the first successful inner-city examples of new urbanism, the community serves as a model for future redevelopment activities. Building on the success of Crawford Square, planning for the eventual redevelopment of the entire Hill District is now underway by neighborhood representatives and city officials.
- In order to attract market-rate buyers to a mixed-income community, subsidized units must be indistinguishable from market-rate units. At Crawford Square the same level of management service and commitment is extended to all units.