A Neglected Market: Mayor Walsh Calls For More Middle-Class Housing

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Mayor Marty Walsh is calling for 53,000 additional housing units in Boston, with more than one-third of those specifically for middle-income earners.

"I think what’s going to happen is you’re going to see a market created in this housing, so you’ll start to get some good developers looking at this housing as well," Walsh said.

Walsh plans to create a market in middle-income housing because there’s not much of one now. You can build luxury units, because high earners can pay for them. You can build low-income housing, with the help of state and federal subsidies and tax incentives. But for households that make between roughly $50,000 and $100,000 a year, it’s not financially viable to build new developments in most Boston neighborhoods.

"We’ve always been frustrated on the development side," said Doug Arsham, vice president at the Boston development company Forest City.

"There aren’t a lot a programs, there aren’t a lot of ways to fill that gap. And that’s the fastest, the quickest growing band in our economy and in this market. And we need to find homes for them," Arsham said.

The city’s plan to create this market is to help lower the cost of construction of new housing units to the point they’re affordable for these families. As part of that plan, Walsh will ask construction unions to lower their rates.

"And they’ve been very engaged in this," Walsh said. "They know it’s a very important initiative of mine. And you know I think that they’re as much of a partner at the table as banks."

To get more banks to fund such developments, Walsh said the city will reform zoning and simplify permitting. Speeding up construction is crucial, said Esther Schlorholtz of Boston Private Bank and Trust.

"So the longer you take the more expensive it is and then it becomes harder to incorporate the middle income, and it really does get so expensive you’re talking about serving the upper income," Schlorholtz said.

The city may also sell more of its land if developers will accept lower profits, something Walsh is asking the stakeholders to do.

"Sometimes that happens, where each group says: ‘I’m not gonna give. I want what I want.’ And then nothing happens. And we can all dream about something and it won’t be a reality," Arsham said.

But Arsham calls the city’s plan bold and he says the interest in collaborating with the new mayor is high, though hopes there will be momentum for middle-income housing.

So does head of the Asian Community Development Corporation, Janelle Chan, which is overseeing a new mixed-income apartment construction in Chinatown, where the mayor detailed his new housing plan.

"And I hope that in the future this isn’t going to be the only project that people point to," Chan said. "There are going to be other projects just like this and will catalyze change -- keep pace with the luxury developments that are going in downtown. Have more affordable units, have more families. That says what our values are as a city."

If all goes well, the biggest obstacle to newly-built residences in Boston could be residents themselves. Neighborhood opposition often stops the best-laid plans from getting off the ground.

This segment aired on October 10, 2014.

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Curt Nickisch Business & Technology Reporter
Curt Nickisch was formerly WBUR's business and technology reporter.



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