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To date, the single family neighborhoods in the Study Area, while low priced compared to suburban homes of equivalent age and builder quality in Houston, have nevertheless managed to remain viable with houses generally in reasonable condition. However, as these homes reach 40 years in age, they will require more investment and upkeep to retain value. The Study Area’s economic health depends on these homes being purchased by buyers who are willing and have the financial resources to ensure both stable or rising values and good physical condition. The most significant obstacle to assuring that cycle is the oversupply of lowerincome, sometimes dilapidated, multi-family properties, deteriorating aged retail strip centers, and the occasional incompatible use – most notably the industrial use along White Oak Bayou just south of West Little York. These elements in the Study Area landscape create uncertainty that may be sufficient to deter home buyers from making the needed investments in the single family neighborhoods. Though rapid gentrification and home value increases have occurred in parts of the nearby Oak Forest neighborhood, its location is not directly adjacent to the Study Area, and it is not anticipated that this market momentum will carry over to the Study Area in the short term.
The nature of the retail and commercial properties in the Study Area is determined by the health of the surrounding residential neighborhoods – the income distribution of the population and the general sense of whether investment is occurring. It typically lags residential revitalization, often by a considerable period of time. Commercial revitalization rarely occurs in advance unless the structures are architecturally noteworthy or uniquely positioned adjacent to a destination amenity. Therefore, though Strategic Objective 2 focuses on the single family market, it is also the key to reviving retail and commercial activity over the longer term.
Therefore, a continuation of the large-scale intervention by the City of Houston is necessary to ensure this near-term stability. In the process, the City and other entities can also create Livable Centers infrastructure that will add a new dimension of mobility and sustainability to the area. These actions can occur on an accelerated basis or a more moderate track; the time frame of stabilization and economic upswing will vary depending on which level of intervention is chosen.
Accelerated intervention scenario
Although the City has taken heretofore unprecedented measures to demolish blighted multi-family structures in the De Soto / Hollyview area, it does not actually own those sites. Given the absentee ownership of many multifamily and commercial properties, plus the highly fractured and convoluted ownership structure of properties such as Candlelight Trails and Candlewood Glen, “arms-length” (willing, non-forced transaction) sale of the properties to the City would be unlikely in the near term. Therefore, a quicker turnaround could only be accomplished through condemnation by the City.
Normally condemnation of private property must be undertaken for conversion of those properties into public uses only. The Texas Constitution and Local Government Code prevent acquisition of privately owned properties for conveyance to private developers. The redevelopment scenario envisioned in this study would convert many of the blighted multi-family and commercial uses in the Study Area to both public open space / recreation and private housing or mixed-use. State law provides for only one way to include private redevelopment on properties acquired through public condemnation: the Urban Renewal statute (Local Government Code Chapter 374).
or the area and adopted through a citywide vote. A recent amendment to this statute provides an exception to the election requirement if the properties to be condemned and redeveloped are in condominium ownership (in Houston only). In the Study Area, only the former Candelight Trails and portions of Candlewood Glen qualify under this exception. Thus to begin the general redevelopment scenario as laid out earlier in this study within a near-term time frame, the City would need to declare the following properties as constituting an Urban Renewal Area:
- Former Candelight Trails condominiums (now demolished), 5675 De Soto, HCAD value: $248,759
- Candlewood Glen apartments / condominiums, 5365 De Soto, HCAD value: $1,298,841
- Former Oak Brook apartments, 5353 De Soto, HCAD value: $1,063,979
- Former Gables apartments, 5600 Hollyview, HCAD value: $581,647
- Commercial / retail properties on east side of Antoine from Pepper Tree to 6314 Antoine, HCAD value approximately $4 million
- Retail properties on east side of Antoine at 6440 Antoine and 6600-6710 Antoine
- Possibly other multi-family and retail properties on west side of Antoine
Public streets and properties such as De Soto Street, portions of Hollyview Street, and the Harris County Flood Control properties along White Oak Bayou and Vogel Creek could be included. The plan would exclude existing single family homes.
Since this includes non-condominium properties, the plan would require a citywide vote. This level of intervention would reach far beyond actions the City has taken in the past, so a great deal of political groundwork would be required. The City could highlight other potentially similar blighted areas (Broadway, Fondren Southwest, Spring Branch, Sharpstown / Gulfton, etc.) and package together as a way of garnering widespread voter support.
Furthermore, this accelerated redevelopment scenario will require significant fiscal and organizational resources up front to accomplish condemnation, property acquisition, and, in the case of the De Soto Bayou Boulevard, public space improvements. It may be most practical to create a local government corporation (LGC) to administer the redevelopment and public improvement process. Funding for these up front expenditures could happen through the following strategies:
- HUD funds (administered through the City of Houston Housing and Community Development Department) – as the area’s current demography has a large low-income component, the public improvements and amenities would be shown to benefit that population; property resales for housing development would need to have stipulations of affordability relative to area median income.
- Section 108 loans provide a means of funding larger scale expenditures. HUD makes these loans to cities on the provision that repayments are secured by future Community Development Block Grant (CDBG) allocations. However, the City should seek repayment funds from other potential sources:
- The Rebuild Houston program for land purchased for drainage / flood control
- NNWMD, Houston Parks Board (Bayou Greenway), and local charitable foundations' contributions for public space benefits to the area
• Resale from properties sold to for-profit housing developers
(stipulating affordability as required by HUD) for new forsale
housing
- Resale from properties sold to not-for-profit developers (consider both lump-sum and payment plan where developer makes payments equal to Section 108 payments to HUD) for new for-sale housing; will require restriction of a portion of home sale prices to conform to HUD affordability guidelines (normally 80% of area median income, or $43,100)
- Ground lease revenue for redeveloped commercial projects
- Lease revenue from tenants in redeveloped commercial projects
- CDBG entitlement funds
- HOME funds
- Texas Parks & Wildlife Urban Outdoor Recreation Grants (currently suspended)
- Harris County Flood Control (where bayou channel detention is involved)
- Houston Parks Board
- Community Housing Development Organizations (CHDOs), other community development organizations, and private forprofit developers
- Lone Star College – as a purchaser of sites to support programs at its new Victory campus or as a tenant / ground lessee on a redevelopment site
- Tax increment funding, if authorized by a citywide vote, as authorized in state Urban Renewal statutes
It cannot be over-emphasized that an Urban Renewal approach, along with large up front redevelopment funding, is technically possible but represents an outsized political and fiscal commitment by the City. Normally the City would not be expected to pursue this route. Political support for elected officials and administrators will be needed from the community, and indeed citywide, for this strategy to be viable.
Moderate intervention scenario
Because the accelerated scenario just outlined may be difficult to bring about, it is useful to consider a more moderate level of intervention. The principal difference is that property acquisition by the City through the use of the Urban Renewal statute would not be pursued. The only acquisition would occur when funding partners such as the Houston Parks Board could bring additional resources to fund an "armslength," friendly transaction. Otherwise, the City would focus on the improvement of existing public properties and rights of way. For example, instead of acquiring and redeveloping the properties on the south side of De Soto, the City would improve De Soto Street (such as adding sidewalks), and put incentive policies in place to encourage redevelopment. These incentives could be especially helpful in defraying the costs of property assembly for some sites that the private sector is unlikely to pursue in the near term, such as Candlelight Trails and Candlewood Glen, because the assembly costs would likely outweigh the potential returns from redevelopment.
Two potential financial incentive programs should be noted:
- Chapter 380 agreements – Texas law allows the City a great deal of flexibility in assisting private development through offering grants, subsidies, loan guarantees, and other help. The City has recently enacted several Chapter 380 agreements for development projects, usually based on incremental tax revenue generation and the meeting of specific public policy objectives such as the developer’s provision of public infrastructure or desired types of employment. The City could offer Chapter 380 agreements to developers within the Study Area whose projects meet objectives supporting the Livable Centers plan and provide new, affordable for-sale housing.
- New Markets Tax Credits – The U.S. Department of the Treasury’s Community Development Investments Fund administers the New Markets Tax Credit program, which helps financial institutions make investments in ventures serving economically challenged populations that would not otherwise have fit within typical financing criteria. It appears that the Census tracts in the Study Area qualify as locations that meet the program’s eligibility criteria. The City of Houston may create an entity that can receive the tax credits which make these transactions possible; local private financing institutions can also receive them. The City could help coordinate applications for New Market Tax Credits that finance property redevelopment in the Study Area that provides affordable for-sale housing as envisioned in this plan. The program could also assist retail or other businesses in the Study Area that are expected to serve or employ low-income Study Area residents.
The moderate intervention scenario assumes that the City continues with its multi-family rehabilitation and code compliance efforts (including additional demolitions as required) using HUD and other funding as available. The apartment complexes west of Antoine along Tidwell should be considered for inclusion in this effort.
It should be noted that except for tax increment funding, the same funding partners as noted under the accelerated scenario could be approach to accomplish appropriate projects that advance the plan.
The moderate intervention scenario, while accomplishing improvements that fit in with the Livable Centers plan, is highly unlikely in the near term to accomplish the significant redevelopment of private properties envisioned herein. Such redevelopment, and associated demographic change toward a more firmly middle-class profile, will take several years to get underway, with truly significant change possibly more than a decade in the future. Still, the continuation of the City’s current efforts plus the additional investments and incentives will help the Study Area turn an economic corner so that it is set on a market upswing, even if a slow one.
Development regulations
In either the accelerated or the moderate intervention scenarios, the City of Houston will likely need to adjust regulations for private redevelopment so that pedestrianfriendly designs do not require variances. Creating a district that allows or encourages site and building design according to the standards provided in the Transit Corridor ordinance (primarily within Chapter 42 of City code) would be an appropriate approach to this issue. This will allow reduced setbacks along Antoine and other major thoroughfares and assure minimum clear sidewalk widths of 6 feet. Other modifications will be necessary to allow shorter block lengths and smaller lot sizes than currently allowed in the “suburban” area as designated by Chapter 42. This is particularly important due to barriers that restrict street connectivity.