A new model of family-friendly housing in Seattle

35-units of family-friendly housing, developed by families for families

A deliberative development disrupts the multifamily housing market with an alternative model of family living in Seattle.

Seattle has a family housing problem
Over 81% of units constructed in Seattle since 2012 are one-bedroom or smaller.  Just over 1% of new units have three bedrooms or more.  In that same period, New York built 30% more family-sized units than Seattle; San Francisco built twice as many.  Considering Seattle just set a record for median home prices and more than 40% of homes sold today are over $1,000,000, suffices to say that Seattle is no longer feasible for most families.  This partly explains why we are leading the country in number of mega-commuters, (>90 minutes, each way), as more families head for the suburbs to find affordable housing.  But suburban living in the Seattle Metropolitan area is among the costliest in the country, barely more affordable than urban living over a 30-year period.  So not only are families falling behind financially but longer commutes and work hours mean that families are not spending family time together.  And here’s why that’s a problem: decrease in meaningful parental connection is directly correlated with child health and wellness, leading to poor school performance, substance abuse, teen pregnancy and other problematic emotional or physical behaviors.

There is a groundswell of young families and empty-nesters searching for alternative housing options, creating an opportunity to design and develop better ways of living together within city limits.

One collection of friends and families is creating a new model of family-oriented housing called the Shared Roof Project at the corner of 70th & Greenwood in Seattle’s Phinney Ridge neighborhood.  Ten households have pooled their resources and are developing a communal apartment building.  From afar, the Shared Roof Project appears to be like any other institutional, mixed-use residential development, but it’s distinct in two very specific ways.  First, it will provide a majority of family-sized units, including two-, three-, and even four-bedroom units.  Second, the people developing it will also live in it as long-term renters.  Of the 35 units, 10 will be tenanted by the owners and their families, living collaboratively in a custom designed multi-family apartment building.  The rest of the units will be open to the market, including some dedicated for affordable housing.  And since the owners plan to raise their families there, they’re willing to invest in higher quality materials, more advanced sustainability features, and a whole strategy around sharing resources that fosters community among neighbors in ways that typical institutional developers don’t care to manage.

FIX’s Role
The owners hired FIX to project manage development from initial visioning through to construction and project delivery, including facilitation of design and amenity strategies, securing a contract rezone with voluntary affordable housing, and overall project management.  Johnston Architects is the architect; Site Workshop landscape design; Anderson Construction is the general contractor.  The project is scheduled to begin construction in the spring of 2018.

ClientThe Shared Roof Project
Size21,000 SF of land
35 residential units
10,000 SF retail courtyard
Location70th & Greenwood, Seattle
Program4 floors of residential over retail
RoleVisioning & design strategy
Project management
Construction management
Capitalization support
ImpactHousing: 25% of units reserved for tenants earning 60-80% AMI

The FIX Impact Development Fund

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Capitol Hill Housing & Africatown, solving equity

Capitol Hill Housing & Africatown — equitable development at Liberty Bank project.

Redlining left a legacy of racial exclusion which today’s growth patterns perpetuates.  Seattle non-profit, Africatown, has created a partnership with affordable housing leader, CHH, that bucks that trend, heals old wounds and establishes a model to emulate.

Africatown & Capitol Hill Housing partnership
The history of post-war redlining divested African Americans across the United States from home ownership and the opportunity for long-term wealth creation.  It also segregated them into the depressed neighborhoods, many of which are now experiencing gentrification as our economy grows and infill developers erect new projects.  The result is a modern-day redlining, displacing existing communities of color and driving a cultural diaspora of African Americans, perpetuating the cycle of divestment and instability.  One new African American led organization within the Central Area neighborhood, Africatown, is raising awareness of these impacts and working with public and private sector leaders to create alternatives models of more equitable development.

The Liberty Bank Building will provide an African American organization the option to own a significant real estate asset without contributing any equity.

One remarkable example is a partnership with affordable housing non-profit, Capitol Hill Housing (CHH) on the Liberty Bank Building, a 115-unit project of affordable housing and commercial space at the corner of 24th & Union.  The partnership defines a series of commitments that ensure a more inclusive development process, creates jobs for people of color, and offers Africatown the option to take ownership of the property in 15 years, once the equity partners have full vested the tax benefits.  All of this with Africatown providing no equity.  Because the project will have still hold both public debt from Seattle’s Office of Housing and private equity, a key challenge of this partnership was agreeing on the capacity Africatown will be required to have in order to exercise their ownership option.  And, toward ensuring success, the partners also required a clear strategy and implementation plan that would outline how the organization would go about obtaining that capacity being the newly formed entity that it is.

FIX’s role
Capitol Hill Housing and Africatown jointly hired FIX to align the partnership around a common definition of capacity and to build a corresponding 15-year implementation plan.  Through the work, the engagement produced a portable business plan and framework for vulnerable populations to self-generate the capacity to be leaders in real estate within their communities, starting with consulting services and evolving into acquisitions and asset management.

King Street Station, pilot for affordable commercial

Transforming King Street Station into a thriving market hall for local small businesses

Seattle Office of Economic Development leads the Mayor’s Commercial Affordability initiative to create new opportunity for local small business in city-owned property.

Supporting affordability with city-owned assets
In 2016, the Seattle’s Office of Economic Development paved the way for the adaptive reuse of historic King Street Station into a market hall for local small businesses as part of the Mayor’s Commercial Affordability initiative.  The initiative was created to produce policy and innovation that would stimulate and bolster small businesses that have been suffering under the pressures of Seattle’s booming real estate market.  While the growth has provided opportunity for many it has also increased the challenge of starting and operating small businesses which represent nearly 94% of all  Seattle’s businesses (50 or fewer employees).  Seattle 2016 retail rents are up 28% since 2012 with retail vacancy rate less than 2%, forcing many out of long-time locations.  And with redevelopment replacing existing building stock, displacement is a growing challenge particularly as few new buildings offer spaces small enough for small businesses.  Less than 20% are providing spaces 1,000 square feet or smaller.

“Small businesses are essential to the economy of our city.  Many of Seattle’s greatest companies got their start in small, affordable storefronts, garages, food trucks or simple coffee shops.”  — Mayor Ed Murray, April 2016

A leading strategy of the Commercial Affordability initiative is to transition existing City owned real estate assets into viable commercial spaces for local small businesses.  King Street Station was historically renovated in 2010 but has largely sat incomplete and vacant other than its lower level which is an active regional rail stop.  The building sits at the intersection of the Stadium District, Pioneer Square, the International District, an ideal retail location in many ways for the bustling office market and event goers.  But the building is not an easy fit for a market hall given its configuration, historic classification, and associated technical challenges.

FIX’s Role
The city hired FIX to lead the feasibility study of the King Street Station market hall, including initial design, development pro forma, and operating business model.  SKL Architects and Rushing Mechanical provided design and engineering services.  The Office of Economic Development is planning to issue a RFP for a third-party operator the the spring of 2018.

Solving the backyard cottage opportunity

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The Trailhouse, a new third place on the Burke Gilman

The trailhouse — a bike-friendly eatery along the Burke Gilman

Ron Sher opens a new third-place with two new restaurants from the Huxley Wallace Collective, giving reason to pause and connect at a busy intersection near Children’s Hospital.

Two-wheeled placemaking
Bicycling has exploded in the United States and the Pacific Northwest is leading the trend.  Bicycling in Washington alone contributes more than $3B in spending statewide.  Our biennial trail budget is up 50% at more than $15M.  This growth and enthusiasm is opening a new opportunity for developers who care about creating inclusive, successful retail environments.  The bicycle, ranging from a toddler’s tricycle to fancy road bikes, is both a business opportunity and symbol of friendly community.  In a 2013 study from New York City, protected bike lanes drove increases in retail sales of local-businesses more than 16% faster than areas without those improvements.

Bicycling is wonderful placemaking tool.  It is great for retailers, great for families, and a symbol of a welcoming community.

Few owners are as devoted to fostering community through a warm retail environment as Ron Sher of Sher Partners.  And as an avid cyclist, he also understands how to create great places around the bicycle.  Anchoring the busy 45th Street bend in the Burke Gilman Trail near Children’s Hospital, Sher Partners is creating a collection of bike-friendly retail spaces and offices to stitch together the neighborhoods and hospital community.   The first phase is a 6,000 square foot commercial redevelopment known as the Trailhouse, which connects directly to the Trail by extending a large on-grade deck, creating a unique experience and challenging permitting process.  The project design (Michael Whalen Architects) creates distinct identities for the two new restaurants by the Huxley Wallace Collective and allows them to share a single kitchen split across the two level building.

FIX’s Role
FIX was the Project Manager for the owner, Sher Partners.  Michael Whalen was the architect.  Metis Construction was the general contractor.  The project opened in March of 2016.

Seattle's initiative for Commercial Affordability

Seattle launches Commercial Affordability program to stimulate local small businesses.

FIX facilitates the Mayor’s Advisory Committee for the OED.

The case for commercial affordability
90% of all businesses in the US have 20 or fewer employees and that proportion is growing according to payroll giant ADP.  Small businesses pay nearly half of all US payrolls.  In Seattle, nearly 95% of all businesses have 50 or fewer employees.  Small businesses drive innovation and small businesses are and have been how many immigrants find economic security, contributing back to our booming economy.  Ironically, as our economy grows, it is becoming more and more difficult to start and run a small business in Seattle as the cost and challenges of operating increases.  Commercial rents are at an all time high while vacancy is at record lows, particularly retail.  Long-time businesses are being displaced with new developments which often replace small-scale leaseable spaces with ever larger spaces on average.  It is difficult to start and operate a small business in Seattle.

Small businesses pay half of US payroll yet our economic growth makes it more difficult to access capital, find affordable leases, and avoid displacement.  Unless we address this disproportionate pressure, we may stymie innovation and a key means of upward mobility. 

In early 2016, Seattle launched the Commercial Affordability initiative to develop new policies and practices that would foster a more supportive climate for local small businesses.  The policies were put forward by the Commercial Affordability Advisory Committee (CAAC), a group of 16 economists, small business owners, developers, PDAs, and associations.  Supported by the OED and city agencies, the CAAC developed a series of recommendations for new entities, policies, and programs that would have a positive impact in the following ways:

  • strengthen existing small businesses and reduce displacement
  • activate ground level public realm of pedestrian oriented neighborhoods
  • enable space for small business incubation including light manufacturing
  • increase the overall economic and cultural vitality of our neighborhoods
  • stimulate growth of emerging businesses, artists and organizations

FIX’s Role
FIX was hired by the city to facilitate this initiative.  We designed a four-month engagement that aligned the CAAC on the core problem definition, created critical paths for small business success, and honed technically feasible solutions to recommend to the Mayor in collaboration with the OED, the planning departments (SDCI and OPCD) and other stakeholders.

William Grose Center for African American innovation

William Grose center for African American innovation

Building capacity within the black small business community to provide equitable access to opportunity and long-term wealth creation.

Boosting African American capacity with entrepreneurship
There are 28 million small businesses in the US, generating nearly two-thirds (64%) of all new private sector jobs and paying nearly half of all payroll.  And small business is responsible for the lion’s share of our country’s innovation, creating 16 times more patents per employee, which increases with the number of employees.  These statistics are not consistent across all demographics, however.  African Americans own just 7% of small businesses (approx half of their overall representation in total population) with gross receipts representing less than 5% of all small business revenue.  And while personal savings is by far the largest means by which small businesses start and expand, African Americans are 22% more likely to use personal credit cards and 40% less likely to use home equity to finance their business needs.  That shouldn’t be surprising given African Americans have twelve times less median family wealth than whites and are 50% less likely to own their home.  So while small businesses are the engine of our economy and the strongest opportunity for employment and wealth creation, it takes access to capital, talent, and technical skills which is not proportionally distributed across all demographics.

One opportunity for leveling this playing field is the category of accelerators, incubators and coworking spaces which together are one of the fastest growing office markets, increasing 25% in number each year 2014-2016, and doubling in member base for that same period.   And there’s growing interest in coworking membership by large companies, signaling not only sustained growth for the sector but also increasing opportunity for the small businesses that are working in these spaces to increase their opportunity for growth.  This may explain why a company like WeWork could be valued at $5B in 2014.   In short the value of coworking spaces is the opportunity they provide to learn and accelerate ideas and gain access to networks and capital.  Plus there’s ample research to support that coworking enables workers to feel a greater sense of control, agency and happiness in pursuing their professional lives which is as good a company perk as any.

Coworking focused on the African American community may help level the playing field and provide access to capital, talent and technical skills required to successfully launch and grow a small business.

It is for all of these reasons that a collection of Central Area organizations are creating the William Grose Center (WGC), a non-profit entrepreneurial training center and coworking space focused on building small business capacity and innovation within the African American community.  The organization will provide technical assistance and an accelerator environment, funded in part by member fees and service contracts, assisting public-sector agencies with community development and capacity building priorities.  WGC is the creation of partner organizations Black Dot, Africatown, and Black Community Impact Alliance who are working with the Office of Economic Development to develop the business model and identify a location, potentially utilizing the Equitable Development Initiative/Fund.  The OED has provided funding to help the organization refine their business plan and perform an initial feasibility study for renovating retired Fire Station 6 at 23rd & Yesler.  Within two years, WGC aims to be building capacity for over 300 members annually and running more than five training events each week from inside the 7,500 square foot historic building.

FIX’s role
In 2016, the OED hired FIX to develop the William Grose Center business plan and project manage the Fire Station 6 feasibility study.  Over a six month period, FIX worked with the WGC team and third-party consultants to define the market opportunity and value proposition, identify revenue sources, create a staffing plan and design an operations strategy.  Concurrently, we managed the technical and design feasibility study for Fire Station 6.  See our post on that work here.

ClientSeattle Office of Economic Development
Size7,500 square feet
Location23rd & Yesler, Seattle
ProgramCoworking innovation center & event space
RoleStrategic planning
Project management
Business modeling
ImpactEnable new mission-oriented African American-owned organization.
A business focused on providing equitable access to skills training.

Fire Station 6 -- affordable housing & black innovation

Seattle Fire Station 6 — affordable housing and capacity with Africatown

Office of Economic Development hired FIX to help Africatown and BCIA realize their vision within the retired city property.

Leveraging a retired city asset for equitable community development
The city of Seattle owns over 200 surplus, underutilized properties many of which could become viable community-owned assets or affordable housing opportunities.  Seattle Office of Policy and Community Development drafted the Equitable Development Initiative as part of the 2035 Plan, addressing growing development inequity.  With funding from the Mayor’s office, this initiative in part enables the divestment of underutilized properties to qualifying community organizations to create more equitable ownership, offset displacement and establish more diverse socio-economic growth patterns.

Seattle’s Equitable Development Initiative is a long term commitment to invest in communities of different races, ethnic backgrounds, and incomes. Equitable development is a way to create vibrant, healthy communities through public and private investments in neighborhoods that the private market has not sustained.  — Seattle’s RSJI Department

Fire Station 6 is a 1931 landmark structure requiring significant seismic and system upgrades.  It is in the heart of the Central Area and is the site for a proposal by Black Community Impact Alliance (BCIA) and Africatown to convert it 31 units of affordable housing over a 7,500 SF innovation center for the African American community.  The proposal is named after William Grose, one of the earliest black settlers of Seattle whose farm helped spur an enclave of African American middle class.  The BCIA and Africatown proposal aims to increase long-term stability for African American youth through housing and small business capacity building.   With the approval from the Mayor, the Office of Economic Development provided the funds for a feasibility study for the proposal in 2016.

FIX’s Role
The OED hired FIX to project manage the feasibility study and co-develop a business plan for redevelopment with BCIA and Africatown.  The project included technical analysis of the building as well as program development, pro forma and operating business model for the innovation center and affordable housing.  See our post on our work on the William Grose business here.

ClientSeattle Office of Economic Development
Size41,000 SF
Location23rd & Yesler, Seattle
ProgramOffice & 31 units of affordable housing
RoleProject Management
Development strategy & pro forma
Operating business modeling
Community engagement & facilitation
ImpactHousing: 30 units of affordable housing at 60% AMI.
Opportunity: creation of a skills training center for people of color.

Building Chophouse, the complexity of adaptive reuse

The complexities of true adaptive reuse — building Chophouse Row

Dunn & Hobbes’ urban infill development added six stories and 30,000 square feet of office, retail and residential to a Character Structure building, creating a true mix of use…and one heck of a complex construction project.

True mixed and adaptive reuse
Seattle introduced the Character Structure ordinance in 2012 within the Pike-Pine neighborhood, encouraging developers to create adaptive reuse projects by offering bonus floor area and height in exchange for keeping buildings 75 years old or older.  The initial code was loosely worded and awarded the bonus to developers who simply maintained the existing facade of old buildings, erecting new structures just behind them, creating fashionable designs that came to be known as the “facadectomy.”  While the city eventually closed those loop-holes, developer Dunn & Hobbes was committed to the intent of the ordinance and created the award winning project, Chophouse Row at 11th & Pike.

Reusing existing structures speaks to the soul of the neighborhood.  Tenants like those buildings better and will pay more to be in them.  — Liz Dunn

Chophouse is an example of a fully integrated adaptive reuse, re-purposing an existing heavy timber and concrete building common in this neighborhood in the 1900’s.  The redevelopment gutted the existing structure, surgically adding a new foundation system with 64 helical pin-piles encased and doweled to a new three-foot adjacent mat foundation.   Throughout, a new heavy steal moment frame structure threads through the existing building and laces to the 40,000 square feet of new program to form a single integrated system — 50,000 square feet in total within six stories.   Where heavy timbers were no longer needed, they were reused in the new structure or as stairs and rainscreen.  Among the more impressive design elements is the restraint to leave building remnants untouched, including fragile old clay tile infill and casement window frames with leaded glass panes.  Walking the building, one is constantly straddling old and new.  This is hte strategy that integrates Chophouse into its context and makes the complexities of adaptive reuse worthwhile.  One cannot over-state the skills of the architects, consultants and contractors involved in making a project like this happen, not to mention the vision and fortitude of the developer, Dunn & Hobbes.

FIX’s Role
FIX provided full project management to the Dunn & Hobbes team beginning with initial project visioning and pro forma modeling all the way through construction management and tenanting.  In 2016 Chophouse Row, designed by SKL Architects and Graham Baba, was named one of the top 25 projects in the world by ULI, provided honorable mention at the AIA Honor Awards, and named the NAOIP 2015 Mixed-Use Development of the Year.  See our project page here for more information and images.