Ground broken on Vera Cruz Village

Housing Authority acquires Cota Street lot from stalled AUD project

Representatives of the Housing Authority of the City of Santa Barbara raised ceremonial shovels on a concrete lot Wednesday morning to mark the groundbreaking of Vera Cruz Village, an apartment complex intended for low-income, disabled and homeless residents.

The Housing Authority purchased the property, located at 116 E. Cota St., and its design 18 months ago from Cota Street LLC.

The company had spent about five years designing and getting approvals through the city’s Average-Unit-Density Program for 15 market-rate, two-bedroom units — but it stalled near the finish line. The Housing Authority preserved Cota Street LLC’s design but split the two-bedroom units into studio apartments.

The four-story, contemporary building will have 28 studio apartments and a one-bedroom unit for an apartment manager. Common spaces, like a courtyard and offices, fulfill the Housing Authority’s vision for on-site support services.

“THE DEAL OF THE CENTURY”

Assem Demachkie, a former co-owner of the property, told the News-Press he is glad the Housing Authority is able to create affordable housing with the lot — noting it “got the deal of the century.” But he has questions about the city’s handling of his architect’s design.

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He, like many builders, felt burdened by a long Architectural Board of Review process. He said the board made multiple changes to the emergency exit door, to be located by an alleyway.

He said although the board insisted upon the location and design of the door, City Attorney Ariel Calonne stopped the project in 2018 when he saw its location. Mr. Calonne said the alley didn’t exist, Mr. Demachkie said.

“They kept using vague language that nowhere in their books did this alley exist,” he said.

The door’s location was a linchpin of the design. Moving it would spur a complete reengineering of the building — something the project had already endured once.

Mr. Demachkie researched and learned the alley was created before the city was incorporated. He had an attorney send a letter to Mr. Calonne.

“After we made a deal with the Housing Authority, the city attorney conceded,” he said, noting the alleyway exit is in the Housing Authority’s plans.

Skip Szymanski, the Housing Authority’s deputy executive director and chief operating officer, heard about the project’s holdup from either the owner or architect as they discussed a possible purchase. Then the Housing Authority approached the city in early-to-mid 2020 about the possibility of acquiring the Cota lot.

“At the time, the city was in the process of internally resolving the issue,” he said. “We don’t want to inherit a problem.”

The city saw Mr. Demachkie’s argument (delivered through lawyers) and told the Housing Authority the holdup was effectively resolved.

Mr. Demachkie said he never got an all clear from the city. The Housing Authority got its assurance before it negotiated with already-agitated Cota Street LLC.

Mr. Szymanski, who originally thought to look at AUD projects stalling in the pipeline, said he had met Mr. Demachkie at the property.

“One of the things that was helpful with the city is we were able to take everything that (Mr. Demachkie) did and rework everything,” he said.

He said he would “absolutely” pursue another project from stalled AUD plans.

“IT TAKES A VILLAGE”

Vera Cruz Village itself came to a pause this year as construction costs soared under the pandemic’s strain.

“We were seeing 25-30% increases, and it just shot our budget out of the water,” Rob Fredericks, the Housing Authority’s CEO and executive director, said. “The city thankfully stepped up as a great partner.”

The city of Santa Barbara issued a $1.5 million loan in early November after the City Council heard the project was delayed. The city had already invested $2 million in the project during its inception.

But when the council was looking for homeless housing solutions as it discussed the Safe Shelter Program, Councilmember Meagan Harmon suggested the city give the Housing Authority the money it needs to meet the increased costs.

“(City Council has) been very helpful throughout our history of providing necessary funding to make the project pencil out and make them successful,” Mr. Fredericks told the News-Press.

As he began the groundbreaking ceremony, he named dozens of people involved in the project: builders, elected officials, board members, community partners and more.

“It’s aptly named ‘village’ because it takes a village to pull off one of these wonderful developments that we do,” he said.

“NOT JUST A DOOR AND A BED”

Mr. Szymanski said the Housing Authority doesn’t get much pushback when it introduces a project.

“We make sure that we operate our properties that will be suitable to the neighbors especially,” he said.

The apartments will look onto Plaza de Vera Cruz, a park the city fenced off to avoid crime. He said the tenants will be able to monitor the park and create a community on that block.

“That’s one of the things that we look for with our properties is kind of get the eyes out to the community to see what’s going on,” he said. “We don’t want our properties to be isolated; we want to have them where they become a part of the community — integrated.”

He said the finishes look like the market-rate apartments planned by Cota Street LLC, but all 28 studios will have income limits and receive project-based Section 8 Voucher assistance.

The city of Santa Barbara had 914 homeless residents in January 2020, according to the most recent Santa Barbara County Point-in-Time study.

Lucille Boss, chair of the Housing Authority Commission, said during the ceremony that Vera Cruz Village will help “28 people who spent the last few cold and rainy days without a safe, secure space to sleep.”

“It’s not just a door and a bed. Vera Cruz Village will also provide wraparound services to ensure residents have the support and the connections they need,” she said.

Case management and instructor-led health and wellness classes will be offered free to residents.

Mayor Cathy Murillo said her motto this winter is “housing is everything.”

“Where will your children go to school? What access do you have to jobs? Where do you live? So housing is everything,” she said.

Vera Cruz Village is estimated to cost $17.6 million. The California Tax Credit Allocation Committee  provided just over $10.3 million in Federal Low Income Housing Tax Credits to the project.

Mr. Fredericks, at the conclusion of the groundbreaking, said he would be back in 14-16 months for a ribbon-cutting ceremony.

email: ahanshaw@newspress.com