The Lodge, Morgan Hill, CA
Goal: To execute a commercially zoned congregate care project for seniors that had been initially planned and entitled by a for-profit market rate developer that let the project go during the recession due to financially infeasibility.
Located in Morgan Hill, a sleepy bedroom community just South of Silicon Valley is The Lodge. The goal of the development from the outset was to make progress towards meeting the overwhelming demand for permanent, affordable senior housing. More than just a place to live, the community was designed and built to focus on holistic health, while also fulfilling CDP’s core missions of establishing pride of place, building thriving communities, providing nutritious food, encouraging engagement through art, and lifelong learning.
In that vein, The Lodge provides a place for seniors in an area that would otherwise be inhospitable to residents who fall well below the median income in Santa Clara County, a.k.a. Silicon Valley. While it is just a start, this project and others like it would hopefully be the beginning of a solution to the housing affordability crisis in the Bay Area, which hits lower-income seniors especially hard. Because the majority of The Lodge residents will likely never be able to afford market-rate senior housing, or an assisted living facility, the amenities and programming at our property are tailored to accommodate residents for the long-term, until they near the end of their lives. To make sure we provided the best possible permanent home in light of this reality, CDP conducted extensive research into those aspects of market-rate assisted living that had the highest impact and lowest cost. We then incorporated that knowledge into our community so that we could provide a similar living environment at a cost that wouldn’t jeopardize the financial stability and economic viability of the project.
The abundant amenities are reminiscent of those found in a market rate senior living or assisted living community and include a commercial kitchen with beautiful dining room and fireplace; an arts and crafts room with a kitchen, computer lab, and television; a library; a salon; a game room with card tables; and an exercise room. In addition there are outdoor amenities including a meandering walking path, bocce ball courts, outdoor dining and bbq’s, and a dog run.
The Lodge went through several iterations before CDP came into the picture and was able to get the project to the finish line. Originally conceived as a market rate congregate care community for seniors 55 and over, the project was initially designed and entitled by a well known for profit market rate developer. When the recession arrived in the end of 2008 the developer pulled the plug on the project and the dust began collecting until an affordable housing developer began working on the project in 2010. When that developer couldn’t figure out how to move the project forward to fruition after 2 years of effort, the Seller was introduced to CDP and provided CDP with the opportunity to breathe some new life into the concept.
Due to the incipient nature of CDP at the time it was necessary to link up with a financial partner who was willing to put their balance sheet into the mix to get the deal closed. With CDP as the lead Developer and the new partner, ICON, as the Co-Developer a great team was born. We proceeded towards a relatively swift closing in Q4 of CDP’s first year in business and suddenly we had a $25,000,000 project underway that was designed as a market rate project but would be serving low income seniors - a win win all the way around.
-Locked in construction costs from a 2011 lump sum bid
-Entitled site with a relatively low per unit land basis
-Very high income county
-Increasing rental demand
-Congregate care requirements including only half kitchens and no ovens in units
-Brand new sponsor and developer entity (CDP)
-Rising construction costs and a flurry of activity in San Jose and greater Bay Area
Number of Units: 138
Lot Size: 5.3 acres
Density: 27.6 units/acre
Unit Size: 546-1,034ft2
Unit Mix: 110 1BD/1BA, 28 2BD/2BA
Parking Spaces: 138
Affordability: 50% / 60% AMI
Financing: 4% LIHTC and Tax Exempt Bonds
Sustainability: Green Point Rated
Architect: Anderson Architects
Contractor: SBI Builders
Property Management: FPI
Non-Profit Partner: Foundation For Affordable Housing
Total Cost: $25,211,249
Cost Per Unit: $182,690
4% LIHTC Equity $8,183,828
Perm Loan $16,600,000
Income During Construction $427,423
CDP is proud to partner with these organizations, dedicated to bettering the lives not only of The Huntington’s residents, but of those lower-income residents in surrounding communities.
LifeSTEPS brings years of experience and specialization in social services to serve low-wage earners living in affordable housing. The STEP in LifeSTEPS stands for ‘Skills Training and Educational Programs’ and is the heart of our mission. LifeSTEPS provides robust social programming at The Lodge including a social services coordinator; adult educational classes, programming and activity development, case management, crisis intervention, and referral services on a regular basis.
Loaves & Fishes
In a truly symbiotic effort that benefits both The Lodge and Loaves & Fishes, this food-oriented non-profit (which serves both San Jose and South Santa Clara County) operates our commercial kitchen to provide our residents with three meals a day at little or no cost. In return, they utilize our kitchen, rent-free, to pursue their larger mission of feeding people in the surrounding community who don’t have access to healthy meals. Through the CDP partnership with Loaves & Fishes the organization has grown from serving 300 meals per day to serving over 1,200 meals per day, aided in part by the opportunity to have a commercial kitchen without paying rent or bouncing between different commissary kitchens..